Volts podcast: Abigail Hopper on the trade case that is crushing the US solar industry
In this episode, Abigail Hopper of the Solar Energy Industries Association discusses the trade complaint that has cast a pall over the US solar industry, why she believes it should be dismissed, and the complexities of tariff policy.
(PDF transcript)
(Active transcript)
Text transcript:
David Roberts
Back in 2012, the Obama administration levied tariffs on solar panels from China, to punish the country for unfairly subsidizing its panels in an attempt to corner the market. In the ensuing years, US imports from China fell off sharply and imports from Cambodia, Malaysia, Thailand, and Vietnam rose just as quickly.
Early this year, a tiny California-based solar manufacturer, Auxin, filed a trade complaint with the US Department of Commerce, alleging that China is effectively laundering its solar supply chain through third-party countries, thereby illegally circumventing tariffs. It asked Commerce to apply commensurate tariffs on imports from those countries. (Canary Media has extremely thorough coverage of the case, if you want to catch up.)
Commerce is investigating. Meanwhile, the industry has been thrown for a loop — imports have fallen off, projects are being cancelled, and projections of growth are being revised radically downward. The tariffs could be anywhere from 30 to 250 percent, which would radically change the economics of big solar projects, and if applied, will be retrospective over the past two years, which means even existing contracts are in jeopardy. The uncertainty has cast a pall over the entire sector.
The Solar Energy Industries Association (SEIA) has been advocating against tariffs from the beginning and is calling on Commerce to dismiss the complaint. I contacted Abigail Hopper, the head of SEIA, to talk about the merits of the case, whether building a domestic solar supply chain is a good goal, whether tariffs work, and what other policies might be preferable.
With no further ado, Abigail Hopper of SEIA. I'm not going to say the whole thing. Welcome to Volts. Thanks for coming.
Abigail Hopper
Thanks for having me. I'm glad to be here.
David Roberts
So this is a knotty and complicated issue we're going to get in here.
Abigail Hopper
Is that the K-N-O-T-T-Y naughty?
David Roberts
Yes, exactly.
Abigail Hopper
Okay, just checking.
David Roberts
Also, perhaps naughty, we'll see at the end. So I want to kind of go through it piece by piece, before we get to the tariff dispute, the tariff case that's at issue here, let's go back a little bit and just talk about the tariffs. These date back to Obama, the Obama era. So why don't maybe you just tell us sort of what tariffs are in place, and what is the rationale for tariffs, like when Obama put these in place in 2012? What is the sort of stated rationale? What are they meant to accomplish?
Abigail Hopper
Sure. And you already have displayed more knowledge than the average person around the multiple layers of tariffs that the solar industry is dealing with. So, yes, these go back to 2012. And at that time, there was an allegation and then a finding, that China was dumping its product into United States. That meant that the Chinese government was unfairly subsidizing production of solar cells and solar modules and then selling them into the United States below cost. So if it cost $10 to make it, they would sell it in for $5, and the Chinese government would suck up the other $5.
