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Suniva, SolarWorld claim trade tariffs would boost US solar jobs

The law firm representing Suniva Inc., a U.S. solar panel manufacturer that is asking Washington to impose tariffs and price controls on imported equipment, claims that "effective remedies" would result in up to 144,000 new domestic solar jobs. That stands in sharp contrast to broad industry expectations. The Solar Energy Industries Association, or SEIA, a trade group, has warned that the measures Suniva requested would cost America an estimated 88,000 jobs by raising the cost of solar power and making the technology less competitive against other energy sources.

Suniva's lawyers at Mayer Brown issued the report a week before the U.S. International Trade Commission is scheduled to hold a public hearing to consider whether imported solar cells and modules are causing "serious injury" to the domestic industry.

"This conservative analysis, using well-established Department of Commerce formulas, shows that this safeguard action can create huge impact in the manufacturing sector, even as we continue to see tremendous growth in solar installations," Matt Card, Suniva's executive vice president of commercial operations, said in a news release.

SEIA President and CEO Abigail Ross Hopper said it is "preposterous" to think that "doubling the price of solar panels would somehow increase demand and create jobs."

Suniva, which is based in Georgia and majority-owned by Hong Kong-headquartered Shunfeng International Clean Energy Ltd, sought protection from foreign competition in April, shortly after it filed for bankruptcy. The company was joined a month later by Oregon-based panel manufacturer SolarWorld Americas Inc. after that company's corporate parent, the German manufacturer SolarWorld AG, said it was filing for insolvency.

A flood of panels

Suniva argues that U.S. companies were hit by a sharp and unexpected increase in global manufacturing of crystalline silicon solar cells and panels after companies in China and Taiwan shifted their operations to other countries to avoid U.S. antidumping and countervailing duties. Tim Brightbill, a partner at Wiley Rein LLP who represents SolarWorld Americas, also pointed to a flood of panels from China that hit the global market in 2016 after the country reduced a feed-in tariff and domestic demand tumbled, driving down panel prices globally.

Between 2012 and 2016, U.S. imports of solar cells and modules made from crystalline silicon rose by 52% in terms of units, Suniva said in case filings. Over the same period, domestic manufacturers' share of the U.S. solar market was cut nearly in half, to 11%.

According to The Solar Foundation, a nonprofit industry advocate, approximately 38,100 people worked in solar manufacturing in the U.S. in 2016, up 53% since 2010. Mayer Brown, citing data from The Solar Foundation, said that if U.S. companies had captured a proportional share of rising domestic demand, employment in the solar manufacturing sector would have grown to approximately 40,400 in 2016.

Suniva and SolarWorld are asking the trade commission to recommend that President Donald Trump set an initial tariff of 40 cents per watt and a minimum price of 78 cents per watt on imported solar cells and modules, respectively, that are made from crystalline silicon. Canadian Solar Inc., a cell and panel manufacturer that is based in Ontario but conducts most of its manufacturing in China, said the average selling price of its standard solar module fell by 12% in 2016 to approximately 51 cents per watt.

Prices stabilize

Mayer Brown said "effective remedies" would result in a net increase in U.S. solar industry employment of between 114,796 and 144,298, including up to 45,000 manufacturing jobs.

Others doubt those claims, noting that the tariffs would be broadly applied to imports rather than targeted at specific countries. Ethan Zindler, head of U.S. research at market analyst Bloomberg New Energy Finance, called the Mayer Brown study "dubious," tweeting Aug. 8 that even if tariffs pushed Chinese firms to build manufacturing capacity in the U.S., the plants would be "quite automated."

"We are ... convinced that the requested remedies could significantly impact the U.S. solar market, imposing a direct burden on manufacturers of solar panels and associated equipment, raising prices for customers and eliminating tens of thousands of jobs," Thomas Werner, chairman, president and CEO of SunPower Corp., a solar panel manufacturer and power plant developer that is headquartered in California, said on an Aug. 1 earnings call.

"We are already seeing module prices impacted by just the possibility of a tariff," Werner said, adding that average selling prices for solar panels have stabilized and are increasing in some markets.