On January 22, 2018, U.S. Trade Representative Robert Lighthizer announced that President Trump approved recommendations to provide relief to U.S. solar panel manufacturers by imposing safeguard tariffs on imported solar cells and modules. The tariff facts are now clear: beginning this year foreign solar panels will be subject to a 30% tariff that will decrease by 5% each year until 2022 (the first 2.5 gigawatts of imported cells are excluded).
Increased equipment prices are not a new phenomenon for our industry. In fact, solar contractors have proven resilient in the face of module price increases; consequently, manufacturers, distributors, and installers will continue to shave costs to further proliferate the number of solar installations nationwide. The chart below shows us the effect that the tariff has had on pricing in the US.
While it is still too early to see the comprehensive impacts of the tariff, it is worth noting that one of the leading ‘Silicon Module Super League’ members, JinkoSolar, is considering local incentives in Jacksonville, Florida to open their first U.S. manufacturing facility. Some have referred to the deal as a solar manufacturing renaissance while others see it as a one-time deal. Either way, JinkoSolar’s commitment to the U.S. market is a promising step towards a more robust, tier-1 supply chain of modules for solar contractors.
If JinkoSolar decides on Jacksonville for their U.S. headquarters, ‘Project Volt’ will provide them with at least $57 million in city and state incentives to begin manufacturing in two warehouses. The project promises at least 800 jobs and offers a great deal of hope towards advancing the local green economy:
Current projections estimate that JinkoSolar will not produce U.S.-made modules until 2020. JinkoSolar has committed to a 1.75 GW master solar module supply agreement over the course of three years.
"This deal will further solidify our leadership in the U.S. market," said Mr. Nigel Cockroft, General Manager of Jinko U.S. "An agreement of this magnitude exemplifies JinkoSolar's commitment to provide our clients with the most reliable products and dependable, regional customer service."
Employment benefits from the tariff decision may only be realized by those in Jacksonville due to the high level of automation in PV manufacturing facilities. Therefore, the potential job losses from the tariff are not to be taken lightly. Even so, JinkoSolar’s mission to decrease their module prices through a $410 million investment in the U.S. market should instill confidence in the industry’s supply chain and the resiliency of solar in the U.S.
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