By: Kristina Thoring, Senior Political Communications Advisor
Solar trade is officially back on everyone’s lips. On January 22, the US announced that it would put a 30% safeguard tariff on solar panels from the rest of the world. This decision is expected to cause a contraction of what has been a thriving US market, with a loss of over 23,000 American solar jobs due to the tariffs.
We do not foresee that the US solar tariff will have a major impact on the European solar market. Nevertheless, the trade tariffs are unfortunate for European solar panel exporters to the US, as the protectionist American market can no longer be an export destination.
Solar is the only clean energy technology that has been plagued by trade measures since the turn of the decade. In fact, this year marks five years of the EU-China trade measures in place on solar panels and cells. This anniversary does not call for a celebration since the implementation of these trade measures we have seen only a decline in solar manufacturing, installations, and jobs on our continent.
There is mounting evidence against the EU solar trade measures. A recent EY study assessing the socio-economic contribution of solar to jobs and value added in Europe found that removing the measures would stimulate demand and therefore lead to a significant surge in jobs. The study focused on Germany and Italy, the major European Solar PV markets and found that with the trade measures removed, 8,500 extra jobs would be created in Germany and nearly 14,000 extra jobs in Italy by 2019. EY extrapolated this model to all EU member states and discovered that over 45,500 additional jobs could be created 2019. This would mean that we would see a 50% increase from today’s EU solar jobs figure – in a time when we need both more jobs and more solar!
A recent European Commission study by DG Justice and Consumers ‘Residential Prosumers in the European Energy Union’ assessed the current regulatory regime impacting solar self-consumers in Europe today, concluding that the EU solar trade measures should be removed to increase self-consumption. The model used by DG Justice and Consumers suggests that lifting the measures will drive an increase in uptake of rooftop solar in most EU countries by approximately 20-30% in comparison to the baseline scenario. It is clear that the measures are reducing consumer demand for solar – this is fundamentally against the interest of the European Union and its objective to have the consumer at the heart of the Energy Union.
We hope that the European Commission will take this evidence into account when they decide whether to prolong or remove the trade duties by the 3rd of September this year. As many of you will know, last year the Commission agreed to phase out the measures after strong opposition from EU Member States and the solar industry. However, a phase-out is not guaranteed, and so it will be up to the European solar industry to once again ensure that these crippling duties are removed for good.
While trade measures have been tried and tested in many parts of the world, they have yet to lead to more jobs, more manufacturing and more value for the region implementing the measures. Trade measures are a simple, shortsighted medicine that comes with a serious number of side-effects – much worse than the imagined illness. According to EY, the trade measures have a negative impact on over 90% of the European solar value chain. No manufacturers of any part of the upstream have benefitted from the measures.
That is why SolarPower Europe has pioneered an industrial competitiveness strategy for solar that will boost the entire value chain from manufacturers of polysilicon, wafers, cells, modules, inverters, a balance of systems, to installers, to operation & maintenance and power sales. We believe that an industrial strategy is a much more suited policy for our innovative technology. In this age of clean energy, we need to see fewer barriers to solar rather than more. It is high time that both the US and the EU finally do away with these ill-advised policy measures and embrace the solar era!
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