Fear of Trump solar tariff helped slam brakes on the fast-growing industry in 2017

Solar Panel installers in Colorado in June 2017. CREDIT: Helen H. Richardson/The Denver Post via Getty Images

The number of jobs in the U.S. solar industry dropped last year for the first time since the Solar Foundation began tracking employment in 2010 with its annual “Solar Jobs Census.”

One of the reasons for the decline in jobs, according to the Census, was “uncertainty” surrounding President Donald’s Trump potential tariff on solar panels and “its impact on the U.S. solar market.”

While the White House didn’t announce the final outcome of the Section 201 trade case until last month (a 30 percent tariff on imported solar cells and panels), the U.S. International Trade Commission (ITC) ruled last September that China had harmed the domestic solar manufacturing industry with policies aimed at taking over the global market. This signaled that some sort of price hike was coming.

The Census conducted its survey during October and November, after the ITC ruling but before the tariff announcement. It found that “71 percent of all solar companies said they had already felt negative effects from the case in 2017, likely due to the uncertainty over the final decision.”

The possibility that Trump would raise the price of a major component to solar photovoltaic systems — some 80 percent of panels are imported — contributed to a slowing of orders last year, which in turn helped reverse the multi-year trend in sharply rising employment. 

Solar installation jobs hit a ceiling last year. CREDIT: Solar Jobs Census

The report notes that the marketplace uncertainty created by the tariff and other federal policies was exacerbated by changes in state policy, especially in California, where the utilities have been transitioning to a rate structure that offers new residential solar customers less economically beneficial terms.

The Census notes that “the long-term trend for U.S. solar jobs has been very strong,” nearly tripling from 93,000 jobs in 2010 to 260,000 in 2016, before losing nearly10,000 jobs in 2017.

Looking ahead, though, the Census notes that 86 percent of solar companies surveyed “indicated that if trade restrictions were imposed, their businesses would be impacted negatively.”

Ultimately, a tariff was imposed that has been projected to cost tens of thousands of jobs over the next few years — especially in red states that voted for the President in 2016.

The good news from the Census is that solar demand has been so strong and the rate of solar job growth has been so high in recent years that Trump’s tariff is unlikely to do more than stall the industry for a few years.