The solar industry is blaming tariffs for delays and cancellations of major solar energy projects.
An estimated $8 billion worth of utility-scale projects were canceled or put on hold for the five-year period that ends in 2022, according to a report from the Solar Energy Industry Association and Wood Mackenzie Power & Renewables. The report says 9,000 jobs — mainly construction and engineering — were lost or not added because of the tariffs.
In January, President Donald Trump imposed tariffs of up to 30 percent on most imported solar cells used in solar panels, aiming to boost domestic manufacturing. The tariff rate will decline before phasing out after four years.
Projects were canceled during the lead-up to the announcement, when installers, banks and power purchasers did not know how high the tariff would be, said Dan Whitten, spokesman for the Solar Energy Industry Association, the industry’s main trade group.
“People kind of deferred planning,” Whitten said. “They decided not to go forward with projects, because of that uncertainty.”
But analysts at Wood Mackenzie are expecting many of the delayed projects to come online by the end of the year.
About 10 percent of solar panels installed in the U.S. are made domestically, Whitten said.
Tariffs also were imposed on materials such as steel, aluminum and electrical components, adding to the cost of building a solar farm.
Jeff Berman, a director at S&P Global Platts Analytics, said in an email that a bigger driver of installations will be the federal solar investment tax credit. That tax credit of 30 percent of the cost of residential or commercial solar systems will drop to 10 percent for utility and commercial installations and zero out for residential installations after 2021.
Representatives from the White House and the U.S. Trade Representative’s office did not immediately respond to requests for comment.
