A U.S. presidential announcement on January 23 disclosed trade protection measures for solar modules. Bloomberg New Energy Finance believes there will be no real beneficiaries under this protection. Additional taxation will reduce the US installed solar market, There is also limited appeal for local manufacturing investment.
Policy itself
The Trump administration's decision to impose a 30% tariff on imported PV cells and components will raise the US 2018 component price by 10 cents / watt and the average selling price to 42 cents / watt, but the tax rate will Decreasing year by year (5%), and annual 2.5GW solar cell imports will be exempted.
Local industry take precautions
While this tariff has a significant impact on the US solar industry, local players in the United States have made some preparations to reduce their adverse impact, including early storage of 5-6GW components, continued use of thin film PV modules not covered by this tariff, A few exempt countries import duty-free components (although the PV modules in these countries have very low capacity).
Expected impact
PV modules are only one component of a solar power generation system, albeit with a large share, which will result in a nearly 10% increase in overall system costs for large ground-based power plants and about a 4% increase in the cost of domestic rooftop systems. Electricity costs rise roughly the same proportion.
Component supplies will squeeze profits to reduce the impact of tariffs on project costs, especially for small-scale systems, but this policy will still result in a drop in market demand and a delay in demand due to project delays, which we estimate Will result in a decrease of about 5% (4.16GW) in new installed capacity during 2018-2023.
Revitalizing local manufacturing?
The U.S. federal government will pay Trump's decision, and half of the additional system cost will be absorbed by the government through tax credits and asset depreciation.
In the hope that the hope of revitalizing the U.S. manufacturing industry through this move will fall through. Only maintaining the four-year trade protection measure and the rapidly declining tax rate each year are not enough to attract any resulting investment in local production capacity. Component manufacturers are still weighing It is worth believing that importing components from Southeast Asia will still be more economical than building new production lines in the United States.
