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In President Donald Trump’s first big move on controlling trade with China, the White House has authorized tariffs of up to 30 percent on imported solar power equipment, according to emerging reports.
The move, approved Monday, weighs heavily on the $28 billion solar power industry, which depends on imports for 80 percent of its supply. The four-year tariffs will begin at a 30 percent rate in the first year and drop to 15 percent by the end of the term, with the first 2.5 gigawatts of inbound solar cells exempt from the taxes every year.
“We are inclined to view it as posing greater trade risk for all types of energy, particularly if other nations establish new trade barriers against U.S. products,” the research firm ClearView Energy Partners LLC told Bloomberg.
The Chinese firm JinkoSolar Holding Co. said the tariff rates were “better than expected”, implying that Trump’s tough stance against the Asian giant’s dumping strategy in international trade isn’t so tough after all. Some companies are considering setting up shop in the United States to avoid the punitive taxes. Taiwan’s Neo Solar Power Corp. said it would conduct a feasibility study on the establishment of assembly lines within U.S. borders, creating American jobs.
Related: New Breakthrough Boosts Solar Fuel Efficiency
The new taxes are seen by some as another targeted strike on the economics of solar power, and follows the Federal Energy Regulatory Commission rejecting an earlier move by the administration to subsidize old coal and nuclear-fired power plants despite their age. The agency unanimously rejected the proposal earlier this month, despite Trump having appointed four of the five members on the commission. The panel concluded that under the proposal, coal and nuclear plants would be compensated “regardless of need or cost to the system,” an idea that would not be “just or reasonable.”
By Zainab Calcuttawala for Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…