New solar stalls amid Trump tariffs

Source: Jeremy Dillon, E&E News reporter • Posted: Thursday, March 14, 2019

New solar capacity additions in 2018 saw a slight dip compared with prior-year numbers due to “growing pains” caused by the Trump administration’s import tariff, the industry revealed in a new report today.

Although not the results the industry had hoped for, the minimal damage caused by the tariffs may offer a sign of solar’s staying power in the electric capacity mix over the next decade.

In total, some 10.6 gigawatts of new solar was added in 2017, the third year in a row for double-digit gigawatt addition by the industry. That number represents a 2 percent decline compared with 2017, the Solar Energy Industries Association said.

“The solar industry experienced growing pains in 2018, in large part due to the unnecessary tariffs that were imposed on solar cells and modules, but this report still finds significant reason for optimism,” SEIA President and CEO Abigail Ross Hopper said in a statement.

The White House instituted the solar tariffs in 2018 as part of a broader push to aid domestic solar panel and washing machine manufacturers. The tariffs are on a four-year schedule, starting at 30 percent and tapering to a 15 percent tariff in year four before going away.

Even as those tariffs took hold, solar emerged as the second leader in new generation capacity in each of the past two years. For 2019, it accounted for 29 percent of new capacity, with only natural gas, currently enjoying cheap prices from the fracking boom, seeing more capacity added last year.

And the solar industry appears to be turning the corner around those additional cost concerns.

“The total amount of solar installed in America is on track to more than double in the next five years, proving solar’s resiliency and its economic strength,” Hopper said. “It’s clear, this next decade is going to be one of significant growth.”

SEIA projects that new solar capacity installed in 2019 will increase by 14 percent, and new installations have the potential to reach 15.8 GW by 2021. And with some 13 GW in utility-scale power purchase agreements signed in 2018, the contracted project pipeline is at its highest point in the history of U.S. solar, SEIA said.

In total, the solar industry stands at a capacity of 62.4 GW, about 75 times more than was installed at the end of 2008.

Part of that success stems from the solar industry’s investment tax credit, extended by Congress at the end of 2015 with an eye toward a gradual phaseout by 2022.

Capitol Hill Democrats are eyeing a potential extension of that credit as part of a general climate change and renewable energy push, in what could be another financing boom for the industry (E&E Daily, Feb. 28).

SEIA has said it is not actively lobbying members on that extension.