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SolarWorld To US Solar Industry: Drop Dead

By Jigar Shah, President of CASE, the Coalition for Affordable Solar Energy, and a world-leading cleantech champion

It makes so little sense that it reads like a round of Madlibs: a German company brings a trade case in the United States that claims to be protectionist but would result in severe domestic job losses and industry contraction.

CREDIT: UNITED NATIONS ENVIRONMENT PROGRAM.

That’s the mad game that German solar manufacturer SolarWorld is playing with the US economy. Ahead of tomorrow’ preliminary ruling by the International Trade Commission on SolarWorld’s petition to have tariffs imposed on solar hardware from US ally Taiwan, it’s important to spell out the consequences of such reckless action.

There’s no clearer picture of what’s at stake than the Solar Foundation’s 50-state breakdown of solar jobs in the United States, released just this week: more than 23,000 new solar jobs were created in 2013, lapping national job growth by a factor of ten. Few areas of the American economy have burned brighter in the past five years than the one powered by the sun.

Of the 23,682 solar jobs, only 100 came from solar panel manufacturing – this after SolarWorld’s first trade case was decided at the end of 2012. Now SolarWorld is back trying the same old tactic. Einstein once described this behavior as insanity, “doing the same thing over and over and expecting different results.”

The American solar jobs that are growing like hot cakes are the ones President Obama championed in his State of the Union address: solar installation jobs “which can’t be outsourced,” and the sales and distribution jobs which drive these rooftop installations.

Clearly, SolarWorld’s approach to growing the domestic solar manufacturing industry is not working. What we need is a US Solar Industry that continues to grow at upwards of 24,000 new jobs a year. In fact, it’s more of a feature than a bug: by driving down prices to make solar attractive to American homeowners, international manufacturing is driving the creation of these installation, sales, and distribution jobs. Between 2011 and 2012, solar system prices declined 44%. It’s no coincidence that US solar capacity grew an eye-popping 71% over the same period.

As with any product, Americans will adopt solar at a certain price point. In the case of solar, it’s usually a matter of being able to beat the cost of local utility power, enabling the homeowner to save money on monthly electric bills. By increasing the cost of solar, SolarWorld’s petition threatens to price the entire industry out of the marketplace for electricity – without encouraging US solar manufacturing.

After years of being derided as too expensive to become a significant part of the US energy mix, solar’s growing affordability has unlocked incredible demand for a cleaner, cheaper alternative to utility power.

The United States has found its natural role in a global solar industry, and no matter what SolarWorld thinks, that role is not in manufacturing. To pretend otherwise is to play a dangerous game with the US economy.

 
 
 
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Written By

is a co-founder at Generate Capital and the author of Creating Climate Wealth: Unlocking the Impact Economy, 2013 Icosa Publishing. Shah unlocked the multi-billion-dollar worldwide solar industry with a business model innovation (Power Purchase Agreement), not a new technology. This model created SunEdison, once the largest solar services companies worldwide. Jigar Shah has shown that business model innovation applied to the biggest challenge of our lifetime – climate change – will unlock a $10 trillion new economy. After SunEdison was sold in 2009, Jigar served through 2012 as the first CEO of the Carbon War Room — the global organization founded by Sir Richard Branson and Virgin Unite to help entrepreneurs address climate change. SunEdison and Carbon War Room proved that we could make positive change through business and financial model innovation in many industries. Today, as CEO of Jigar Shah Consulting, he works with global companies in a multitude of industries to deploy existing clean energy solutions fueled by new business models.

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