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Tuesday, Oct 21, 2014
Commentary

Protect solar industry through free trade, not tariffs


Published:

When I first entered the solar business over 20 years ago, it was just me and a few friends working out of a small garage. Many of us will look back to two decades ago and confidently say that we knew solar would make it in America. The truth: None of us predicted its success would come so soon.

Today, the solar industry is one of America’s fastest-growing sectors.

According to a recent survey conducted by the Solar Foundation, roughly 145,000 Americans are directly employed in solar jobs and even more are indirectly employed through the solar supply chain. In fact, more solar power-generating capacity was installed over the last few years than coal and nuclear power combined.

But the solar industry faces a serious challenge: A petition filed with the International Trade Commission (ITC) and the U.S. Department of Commerce by SolarWorld, a German-based company, asks the U.S. government to impose protectionist tariffs on imported solar panels.

This is the second time that SolarWorld has made such a request. In 2012, SolarWorld successfully brought tariffs against imports of solar cells and panels from China. We were neutral on their position then, but this new petition goes too far.

Much of the solar industry’s recent success can be directly tied to free trade, through which materials and valued-added services can properly function in an unfettered global economy. Several Asian countries, such as China and Taiwan, excel at providing value-added assembly for solar products, as they do with TVs and other consumer goods. This specialization has, in turn, allowed the U.S. to become the leading global manufacturer of high-purity polycrystalline silicon, the raw material used to create solar cells.

As a result of free trade, the U.S. has been able to lower the price of solar, making it competitive with other forms of energy such as coal. In fact, customers are now switching to solar because it makes economic as well as environmental sense. All the while we are creating more high-paying jobs for American workers in areas like project development, installation and — like my company NexTracker — manufacturing.

SolarWorld’s petition asks the ITC and Department of Commerce to expand protection for SolarWorld against products from other nations and seeks to handcuff free trade in inappropriate and counterproductive ways at the expense of American workers. Claims by SolarWorld that they are seeking to protect U.S. jobs by filing this petition could not be further from the truth. If successful, the petition would seriously hurt the solar industry and negatively impact the U.S. solar workforce.

Bottom line: SolarWorld’s petition is really about protecting one company from competition at the expense of everyone else in the industry.

Investors and industry experts know what’s driving demand for solar: competitive prices. That’s why SolarWorld’s trade petition is so destructive. Its very existence creates an environment of uncertainty that hurts investment and growth.

No investor wants to risk money on a project where the price could change before completion, and no solar company wants to hire workers that they may not have the business to afford in a few months.

There is still time to negotiate a settlement, but thus far, SolarWorld has been unwilling to come to the table. A bipartisan group of seven U.S. senators recently wrote to Vice President Joe Biden asking the administration to convene the parties for negotiations to avoid damaging tariffs before the Department of Commerce announces a preliminary decision in June.

Our solar industry has come a long way from the garages of the past, and its future looks even brighter.

Let’s not turn back the clock by allowing a foreign company to exploit U.S. trade law. Instead, let’s continue to build a viable solar industry together.

Dan Shugar is the CEO of NexTracker, headquartered in Fremont, Calif. Readers may write to him at dshugar@NEXTracker.com.

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