A Solar Energy Update

They say the road to hell is paved with good intentions. It could very well be that it’s also paved with foreign solar panels,  which were hit with a tariff which was supposed to increase demand for U.S. solar panel production. But some other things happened, instead. As an electrician in a state which can produce an enormous amount of solar power, we are watching the changing solar industry. Here are some highlights:

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Big companies stockpiled before the tariff

Bigger solar panel companies who had the income and space to do so stockpiled cheap foreign solar panels before the tariff came into effect. They devoted huge lots to nothing but holding solar panels. The increased demand made the price of foreign panels drop even lower, creating a struggle for US solar manufacturers.

China dropped subsidies

When China ended their subsidies for solar companies, many solar projects in China halted, wisely ending the bloated solar energy installations which were built at the expense of the Chinese consumer.  This, however, wasn’t good news for the American solar companies who had hoped to gain an edge in the solar market, since the price of foreign panels dropped again. Added steel and aluminum tariffs set U.S. manufacturers back even further. 

Sagging industry

Solar employment is down, generating capacity is down, and installations are down, all of which have hurt the installation companies, clean energy goals, and other industries as thousands of laid-off solar employees scramble into other job markets.

Over fifty solar companies have applied for exemptions from the tariffs, but the U.S. trade representative office is beleaguered with requests for exemptions from the steel and aluminum tariffs, creating a gridlock of requests.

New markets for China

Meanwhile, China is looking to new markets in India, where lofty, clean energy goals are expected to create a fertile market. Because solar and wind energy is cheaper than coal by half, India has shelved hundreds of thermal coal projects in favor of, a trend which is expected to continue. Since American solar manufacturers are battling metal tariffs, they aren’t likely to provide viable competition against China.

What about the US? 

For the American consumer, the plummeting solar panel market means the cost of panels could continue to drop by as much as 25% within the year. But, because the market is so unstable, no one knows where or when the downward spiral will end.
Also, the Internal Revenue Service has announced an investment tax credit of up to 30% to solar developers who invest 5% or more of the total expected installation cost of a project by the end of 2019. The chart on this page shows the projected schedule of requirements and incentives.

The credits make it clear that the government intends to be very generous with developers who are willing to invest in solar. 

For the residential electrician, the loop de loops occurring in the solar industry remind us that electrical power sources are a viable thing and that the energy which powers our homes, electrical appliances and power tools can ebb and flow with the changing times. Electrical grid structure, energy usage, and even electronic devices are all things to treat with care, care which often falls to a local electrician.