US Stands to Lose up to 60,000 Solar Industry Jobs Should Tariffs on Chinese Silicon PV Imports Be Imposed, CASE-Brattle Group Study Says

January 30th, 2012 by Andrew

Launching its latest salvo against the Coalition of American Solar Manufacturing’s (CASM) anti-dumping and countervailing duty petitions with the US International Trade Commission (ITC) and Commerce Dept., the Coalition for Affordable Solar Energy (CASE) released the results of a study by the Brattle Group that it commissioned.

A 100% tariff imposed on imports of silicon solar photovoltaic (PV) cells, modules, and panels from China would result in the loss of as many as 50,000 net jobs in the US over the next three years, according to a press release announcing the results of the study. Moreover, retaliatory tariffs by China on its imports of US polysilicon would result in the loss of another 11,000 jobs in the first year following their imposition.

High and Low Scenario Analysis Estimates

Brattle Group analysts calculated high and low estimates of the effect on US solar industry jobs through 2014 based on the imposition of 50% and 100% tariff scenarios. In its unfair trade case, CASM is actually asking for the imposition of tariffs as high as 250% retroactive to around mid-November, CASE points out.

Imposition of a 100% tariff would result in consumer market losses ranging between $698 million and $2.62 billion. That translates into the loss of anywhere from 16,917 to 49,589 American jobs, according to Brattle’s analysis. A 50% tariff would result in consumer market losses from $621 million to $2.29 billion, which would result in the loss of between 14,877 and 43,178 solar industry jobs. The analysis factors in potential gains in domestic silicon PV cell or module manufacturing, CASE notes.

“This analysis makes it clear that imposing even a 50% tariff, much less than SolarWorld has requested, would be devastating for American workers,” said Jigar Shah, President of CASE. “We cannot allow one company’s anti-China crusade to threaten the U.S. solar industry and tens of thousands of American jobs.”

Elaborating on Brattle Group’s analysis, report author Dr. Mark Berkman stated, “While the U.S. solar industry has many facets and is quite complex, we were able to model the industry by utilizing straightforward economic analytical methods.

“We started by projecting the reduced demand for solar systems resulting from price increases due to tariffs. We then analyzed projected job gains and losses under two scenarios, each using a 50% and 100% tariff on imported solar cells and modules. Even under the most conservative assumptions, we did not find a scenario where imposing a tariff would create more jobs than it eliminates.”

Report Details; Fear Factor

The results of a scenario where no tariffs were imposed, Brattle Group found that aggregate demand for solar PV systems would increase from 1,678 MW in 2011 to 4,894 MW by 2014. A 50% tariff would raise industry-wide prices and delay growth, with total demand falling as low as 3,350 MW, a drop of over 31%. Aggregate demand would fall as low as 3,159 MW if a 100% tariff were to be imposed, a drop of more than 35%, according to the Brattle Group.

The study also included the “fear factor” of retaliatory action by the Chinese government, specifically on imports of polysilicon from US manufacturers, an action that Chinese producers have raised with China’s international trade authorities. “The U.S. is a major supplier of this component of photovoltaic modules, and removing Chinese demand for U.S.‐manufactured polysilicon is expected to result in around 10,881 U.S. job losses in the first year after tariffs are imposed,” according to a CASE press release.

“This is an eye-opening analysis,” said CASE’s Shah. “Even after accounting for job gains in solar cell manufacturing, the likely job losses in the rest of America’s solar industry and economy are staggering.”

The study did not take into account the potential damper on demand and US clean energy policy the tariff imports could have as a result of an increase in silicon solar PV costs, CASE noted. “Cost is the single most important factor in the ability to grow U.S. solar markets. Most U.S. incentive programs are predicated on a declining cost-curve. In these political and economic times, getting to scale will depend on parity with alternatives,” said Adam Browning, executive director of the Vote Solar Initiative, a non-profit public advocacy organization that works to build state solar markets.

A full copy of the Brattle Group’s report, entitled, “The Employment Impacts of Proposed Tariffs on Chinese Manufactured Photovoltaic Cells and Modules,” is available via the link above.

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Tags: Brattle Group, case, CASM, solar trade war, us china soalr trade war, US China solar trade, US China solar trade dispute, us green jobs, US polysilicon exports, US silicon solar exports, US silicon solar PV imports, US solar jobs

About the Author

Andrew I've been reporting and writing on a wide range of topics at the nexus of economics, technology, ecology/environment and society for some five years now. Whether in Asia-Pacific, Europe, the Americas, Africa or the Middle East, issues related to these broad topical areas pose tremendous opportunities, as well as challenges, and define the quality of our lives, as well as our relationship to the natural environment.

Owl2z

How about using the same tactic the Chinese are using to maintain there low costs. Their government subsidizes their manufacturers while we subsidize fossil fuels.
Jim Edwards

Wake up americans. the business world is out to pinch every damn penny you have, and take it away from you. The oil industry was the first to Rape the citizens with the oil prices, and will do so until someone starts a revolt The food industry is doing the same thing gouging for profit. The economy did not get in the mess its in, by its self.It has one hell of a push from high price gouging from big business, and I have no doubt the solar industry is playing patty cake with price gouging also. So what does our sterling government do???Why the same thing they have always done”self serving, and-pocket lining. –I almost forgot—Have a nice day jim e
dcmeserve

I would support the 100% tariff if it was accompanied by a rise in the federal subsidy for solar systems from 30% to 50%. That should cover the increased module costs due to the tariff, for the domestic installers that purchase them.

So costs to end customers would not go up. Instead, they could see a big drop when they purchase from installers that use the domestic panels — except that demand for these panels would go up a lot as a result of the improved subsidy, so it might work out even in the near-term. But in the longer-term, it means there will be a big incentive for more panel production within the U.S.

So, in this scheme, there shouldn’t be any jobs lost among installer companies, yet still jobs created due to new panel-production factories coming online.
Jim Edwards

what is the actual cost to build a 100 watt solar panel in the usa ??
Anonymous

Short term vs Long term.
Should we worry in this job climate about jobs or having our own green industries?
Should we worry about climate change or building our green economy?
Tradeoffs must be made and current benefactors will use they can to maintain the situation, their bias is obvious.