This is your SolarWakeup for January 23rd, 2018

Tariff Breakdown Conference Call. Join me tomorrow for a conference call at 3 PM EST to discuss the tariffs put in place. I will have a few experts on to discuss their take in addition to mine. RSVP Here.

The Decision. By now you have seen the news, Trump put a 30% tariff in place in response to the ridiculous 201 petition. It declines 5% per year and the first 2.5GW of imported cells are exempt. There does not appear to be an exemption for anything, module size or country of origin. Everyone is denouncing the decision rather harshly, especially given the overarching advocacy against the tariffs. This is the third trade case that solar has lost in the past few years, a record that is not to be emulated.

The Bad. Module prices are going up and it’s going to hurt. Markets, especially large scale ground mount, in places that use PURPA or hedges are going to suffer. 10 cents is more than the margin in most cases which means that the price pressure is going to get intense. The fact that solar lost again is also a sign that we must think about doing things differently. I ask again, what would it take for a US cell phone maker to file a 201 against Apple and actually have it hear. It would never happen. Solar must review the plan of action it undertook and understand what went wrong and what has to change going forward.

The Good. It’s not nearly as bad as it could have been. On the other hand, once pricing settles back into place, you may be surprised to see pricing below Q1 2017. In fact, I believe that most people will buy panels below where they bought most of the 2017 modules at. Also, the uncertainty is over. No more discussions about import risk and who takes the risk of retroactive tariffs. You can go about your business with a clear set of guidelines. You have also seen how bad it can get if you don’t get involved. Use this opportunity to look at your own actions and what you could have done differently.

Settlement. Lighthizer’s comment is right in the tariff press release. The USTR will look to engage interested parties to try and create a global settlement. My take, the 201 tariffs do little to help SolarWorld and Suniva with cash and the global settlement is the best way. I would look to remove the all the US tariffs and the Chinese tariffs on US silicon while creating an import license to drive cash to US manufacturers. This would lower the overall cost of solar in America and grow the market while actually helping grow US-based manufacturing.

Longer View. If you want even more of my opinion on the matter including what I think needs to happen next, check it out here.

Talks Continue. Join me in New York next Wednesday to talk about the 201 process with an industry insider who was in the room. Hint: It’s not Alexander Hamilton. Register here.

Opinion

Have a great day!

Yann