Solar energy's perilous winter
Forget EPA's climate rollbacks and the Paris brouhaha. The renewables industry, and solar energy in particular, is facing a series of overlapping policy battles that are probably more consequential, especially in the near-term. Here's the latest in three fights that matter right now:
Coming today: The Solar Energy Industries Association and allies will roll out a proposal soaked in Trump-friendly language that's designed to offer an alternative to tariffs on solar panel imports that the White House could impose soon.
They're unveiling an "America First Plan for Solar Energy" that argues that tariffs and quotes that a pair of distressed panel manufacturers are seeking.
The plan, partially shared with Axios ahead of the rollout, argues that avoiding the tariffs that the industry says would badly curtail growth is needed to help support U.S. "energy dominance"—a phrase Trump officials use mostly to describe their support for wider fossil fuel development and exports.
- "Do not cede world leadership in solar power production. Listen to a broad but unified coalition of energy producers, conservative groups and American businesses large and small, which all see solar investment as giving them an edge," it states.
- Policy: It says that if the administration insists on some new trade measures, they should forgo tariffs and instead pursue alternative ideas including an "import license fee." According to a summary, the money from foreign manufacturers would be redistributed to U.S. manufacturers to bolster growth. "At a .5% fee, this plan would result in $192 million going directly to U.S manufacturers, and at a 1% fee it would raise $384 million," a summary notes.
The proposal arrives ahead of the public hearing tomorrow on potential tariffs and quotas hosted by the Office of the U.S. Trade Representative.
In Congress: The wider renewables industry is scrambling to fight portions of the Senate-approved tax plan that make changes to the corporate tax code in ways that wind and solar companies say would have a spillover effect of nullifying the value of separate tax credits.
A Bloomberg story yesterday sums it up this way:
- "The issue hinges on an arcane but critical source of clean-energy financing that's expected to reach $12 billion this year. The funding, known as tax-equity, comes from renewable-energy developers selling their tax credits to banks, insurance companies and others that apply them to their own bills from Washington. If those big lenders wind up with a minimum tax on foreign transactions, they may have less need for clean-energy credits."
- Go deeper: A new note from the Rhodium Group consultancy explains the implications of the House and Senate tax plans for various renewable energy sources.
At FERC: The opening phase of Energy Secretary Rick Perry's plan to keep at-risk coal and nuclear plants is coming to a head as soon as next week.
Interim Federal Energy Regulatory Commission Chairman Neil Chatterjee has said he wants to provide a "lifeline" to plants while the independent commission weighs Perry's proposal to better compensate coal and nuclear plants in certain wholesale markets for their "resilience and reliability" attributes. Perry has asked FERC to take action by mid-December.
The solar industry has joined with other critics in opposition to his proposal.