The tariff war is heating up
the landscape of the global solar industry faced a fundamental shift when the Trump Administration, as a direct reaction to China's unfair advantage in the United States solar market, officially placed a 30 percent tariff on all solar imports. The tariffs, beginning at 30 percent are set to drop by five percent yearly, eventually leveling out at 15 percent in 2021.
The reasoning behind the tariffs is to create a level playing field in the U.S. solar industry. The tariffs counteract the Chinese government's practice of subsidizing solar panel production which allows Chinese manufacturers to introduce their products to the U.S. market at artificially reduced prices. Green Solar Technologies (GST), a solar company based in Los Angeles, CA, stood firmly behind the implementation of the tariffs and continues to do so today.
Nicki Zvik, Founder of GST, remarks, "Our company is proud to use only high-quality, American-made panels. The tariffs allow the American solar industry to compete fairly in the U.S. while reducing the use of lower quality foreign panels. Before the tariffs, panels were made in and imported from countries like China at such low costs that U.S. based solar manufacturers couldn't compete. We believed that this was detrimental to maintaining fairness in the marketplace and was damaging to the U.S. economy as a whole. This is why we went to Washington D.C., where our COO, Edward Harner, spoke in favor of the tariffs on behalf of all American solar manufacturers."
After 18 months, the results of the solar tariffs are generally positive for the U.S. Many companies have opened solar manufacturing plants in the U.S., creating thousands of American jobs. One of the more notable companies is LG, which now manufactures solar panels out of Huntsville, Alabama and employs a team of over 300.
"We are proud that we played a role in the success of the tariffs," states Zvik. "As a result we see positive trends in the U.S. economy and job market as well as a shift in the mindset of so many companies. It's great to see the increased value being placed on products made in America, most particularly high-quality solar panels that are helping to create a cleaner environment while boosting the U.S. economy."
But with any success comes the inevitable pushback. The tariff war is far from over. Chinamost recently retaliated to the U.S. tariffs by announcing their plan to place tariffs on some $60 billion worth of American products while the current U.S. administration began expanding tariffs to all $540 billion of Chinese imports. China is known for employing forceful trade tactics against other countries to coerce them into compliance with its goals, but the U.S. has decided instead to protect its interests and stand firm in its trade negotiations with China.
The tariffs on both sides will be sure to shake up the global economy, but Nicki Zvikremains optimistic regarding the impact the tariffs have had and will have on the American solar industry.
He states, "It will be interesting to watch how the world responds to the back-and-forth between the U.S. and China as the two countries are major players in the global marketplace, but the recent actions taken on both sides should have little impact on current trends in the U.S. solar marketplace. The wheels are already in motion as many solar manufacturers have already moved, or are in the process of moving, to the States, so there's every reason to believe that the U.S. solar industry will shine brighter than ever."
Nick Zvik is the founder of Green Solar Technologies and Spectrum Properties.