AUSTIN (KXAN) — Wednesday, the federal tariffs the Trump administration announced will go into effect, placing a tariff of 30 percent on imported solar panels the first year and then decreasing to 15 percent.
The Trump administration said they decided on the tariff in an effort to protect American manufacturing of solar panels, as the popularity of cheaper panels from overseas has skyrocketed. The decreasing cost of solar has made it a more popular option for both the consumer and utility scale.
For larger scale solar projects, Charlie Hemmeline, executive director of the Texas Solar Power Association, believes more of the impact of the tariff will happen in 2019 and onward as many companies have already accounted for the tariff in their planning. For the Texas solar businesses Hemmeline works with, he believes these changes will impact their hiring and expansion in the immediate future.
“We’ll deal with this as a challenge, but ultimately we’re optimistic about solar in Texas,” he said.
Danielle Murray, who is the solar program manager for Austin Energy, said homes and businesses installing solar will see an estimated 3 to 5 percent price jump.
“It’s a relief to have a decision she said,” noting that she’s spoken to companies who’ve stockpiled solar panels who’d anticipated the tariff might have been harsher than it actually was.
Murray said because the price of solar has come down so dramatically in recent years, many more customers have been installing as they find that it’s a financial decision they can afford.
Since 2014, Austin Energy planned to have a “ramp down” of their incentives because the cost of solar decreased so much. But in 2016, they opted to keep it going as the city is still trying to get more solar to people who are renting or living in multi-family units.
Austin Energy has announced they aim to start a new incentives program by April of this year. In the new program, people who qualify will go through training about working with contractors and what to look for in panels. Each customer will be given a flat rate, Murray says they’ve yet to finalize it but the rate will be more than $2,000 and accounts for the increase in cost from the tariff.
Murray is emphatic: the city of Austin is not getting rid of incentives, the new program will be in place for the foreseeable future. As solar prices go down, Austin Energy may reduce their incentive rates too.
“Even with the tariff, solar costs are at an all-time low,” Murray said.
“What is concerning is not having federal support for clean energy,” she added. “Locally we’re all going to work toward this clean energy future. I think the writing is on the wall this is where the industry is headed.”
Joshua Rhodes, a research associate at UT Austin’s Energy Institute, said he felt the tariffs on imported panels were “really unnecessary.”
“The fastest growing job in the U.S. is solar [photovoltaic] installer and a tariff hits those foremost, so if you’re going after jobs, it’s probably not a good idea to make it harder for these jobs to exist,” he said.
Rhodes said imported solar panels are the reason for the dramatic decline in the cost of solar around the U.S.
“All the solar in Texas that was gonna get built over the next four years will get built, it just might get pushed down the line a year or so as we wait for the tariffs that fall off,” Rhodes said.
He added that while incentives make solar installations more likely, he predicts solar will do just fine even without the incentives in Texas in part because it is becoming so inexpensive to do in the state.
“So if you’re thinking this tariff is gonna drive up the cost and you’re not looking into it, you should look anyways, I don’t think [the cost] will surprise you,” he said.
Dale Bulla of Austin has seen benefits because of his solar panels, he installed them in 2004 because the city began offering incentives. Bulla, who with his wife are retired teachers, says the solar helps them save money.
“We haven’t really paid for electricity in the last five or six years, we produce more than we use on an annual basis and we drive two electric cars, so we drive on sunshine,” Bulla said with a laugh. Last year his average electric bill was -$3.33.
He adds that panels now are even more efficient than when he bought them.