GTM Research has issued a revised forecast that finds the U.S. solar market will see a net reduction in installations of around 11 percent as a result of the new tariffs. That translates to a cumulative 61.3 GW of solar deployed over the next five years compared to an original projection of 68.9 GW, for a 7.6-GW reduction in installed solar PV capacity between 2018 and 2022.
The tariffs result in an average 10 cent per watt increase in year 1 prices for modules, stepping down to a 4 cent per watt premium by year 4.
Later this year and in 2019, when people start to buy more modules fully affected by the new tariffs, the full impact sets in.
Even with the new tariffs, GTM Research expects the industry to deploy more than 10 GW of solar installations in the U.S. this year, and 11.9 GW next year, with continuous growth through 2022. But that growth will be at a slower pace than initially expected.
The new analysis shows that new and emerging state solar markets are disproportionately affected by the tariffs, with Southern states like Texas, Florida and South Carolina among the most significantly impacted by the tariffs. Oregon, the home state of trade case petitioner SolarWorld Americas, will be the eighth most affected solar market in the country. Georgia, Suniva’s home state, will be the fourth most affected market.
According to the Solar Energy Industries Association (SEIA), the tariff decision is expected to cause 23,000 job losses this year, with job cuts remaining in the tens of thousands throughout the four-year tariff period. Abigail Ross Hopper, SEIA president and CEO underscored that the tariffs are a big deal for the thousands of people likely to lose their job this year, however. The 7.6-GW reduction in U.S. solar installations through 2022 is meaningful. “Those are significant numbers if you think about energy production, if you think about employment numbers, and certainly if you think about investments,” Ross Hopper said. “It means billions of dollars of lost investment across the country. Some 1.2 million homes won’t be powered by solar” as a result of the decision, she added.
For Suniva and SolarWorld Americas, meanwhile, it’s unlikely the tariffs are severe enough to reboot the U.S. solar cell and module manufacturing sector to their desired extent. Yet the petitioners both issued statements yesterday praising President Trump and adding that they are hopeful the remedies will be sufficient to rebuild solar manufacturing in the U.S. “We look forward to working with the administration as these tariffs go into effect and beginning global settlement negotiations,” Suniva said. “This is a step forward for this high-tech solar manufacturing industry we pioneered right here in America.”
The Office of the U.S. Trade Representative confirmed to GTM that free-trade partners Canada, Mexico and South Korea are not exempt from these global safeguard measures announced. SEIA said it is expecting exemptions for certain solar products, such as solar-powered backpacks. Whether or not the administration will issue exemptions specific solar panel technologies, such as high-efficiency panels, remains to be seen.
Source: GTM Research U.S. Downstream Solar Service