On January 22, 2018, the Trump White House passed a 30% tariff on all foreign solar components, including both solar cells and solar modules. The tariff will phase out by 5% each year until it eventually reaches 15% in 2021. It comes as part of a broader economic effort to keep manufacturing jobs in the US. Many, however, are arguing that this move will, in fact, hinder the American solar market. With so many opinions and projections out there, we thought we'd make it a little more personal for the Santa Barbara resident and business owner. What sort of effect (if any) does this tariff have on the local solar economy and the prices consumers can expect to see?
1) The amount of projected new solar projects in California will decline dramatically.
Projections from Greentech Media Research estimate that California will be the biggest loser in the amount of new solar that would have been implemented. To put a number to it, Californians will (potentially) miss out on 1,079 megawatts of energy produced by photovoltaic panels. That's roughly equal to the amount of electricity used by 175,000 US homes per year (seia.org). The silver lining? Most of this loss will be in utility-scale projects, meaning commercial and residential solar will continue to thrive. While this looks good for the market, this ultimately translates to energy that could have been generated renewably, but will instead continue to be produced through environmentally-harmful means.
2) The percent decrease in installations will not be nearly as drastic.
Solar installations in California, as a result of the new tariff, are projected to decrease by 7%, one of only a few states falling on the positive side of the 10% national average. Why is this? As a state, California continues to politically back a more solar-powered future with tax credits and incentive programs. If you're a homeowner in Santa Barbara, for instance, you can still receive a 30% investment tax credit on your solar system until 2019. For businesses, that number jumps to 50% until 2019. For homebuilders, the New Solar Homes Partnership grants rebates to those who choose to construct new, energy-efficient solar homes. For all solar owners, the Net Energy Metering Program grants "pay-back" credit to extra energy not used by your home that's sent to the grid. California legislature has gone to great lengths to make solar economically intelligent as well as environmentally responsible.
3) Most solar installers will increase their cost of installation by 3-4% to offset new tariff pricing. (Sunrise 805 is not "most".)
According to Energy Sage, US solar customers should expect to see a $0.10 to $0.12 increase per watt in pricing for solar materials in the first year under the tariff. This will translate to around a 4% increase in the cost of solar installation, on average, not to mention price increases to account for inflation. As a certified Certainteed installer, however, Sunrise 805 has been offering American-made solar panels of the highest quality since our company's beginnings. What does this mean? While, yes, a resident or business owner in the 805 will likely see the cost of installation increase for most Santa Barbara solar installers, our pricing will be affected to a much lesser degree, cushioned by an existing relationship with a US-based company. As a consumer in a competitive marketplace, you can rest assured that we will continue to offer the highest-quality products and premium workmanship, for the best prices you can find.