Legislation: Solar Tax Credits Only for US-Made Panels

05/16/2012
SustainableBusiness.com News

Senators Charles Schumer (D-NY) and Sherrod Brown (D-OH) introduced legislation that would allow only US-made solar panels to qualify for the 30% solar tax credit individuals and businesses receive when they install solar systems.

70% of the parts for qualifying solar panels would have to be made in the US. If the solar panels are manufactured here, 50% of parts must be US-made.

The vast majority of solar panels used for US systems are now made in China. The legislation would encourage those manufacturers to locate in the US.

"The federal government has to take China's stranglehold on the solar industry very seriously, and U.S. manufacturers must have every arrow in their quiver to fight back," says Schumer. "This proposal is tough, but it's needed to successfully counter China's unfair trade practices.

Sherrod Brown says, "We can't trade our dependence on foreign oil for dependence on Chinese-made solar panels. We went from a solar trade surplus with China to a solar trade deficit in a matter of years. Ohio workers can compete with anyone in the world, but they deserve access to a level playing field. When the Chinese government provides direct export subsidies to its solar manufacturers, that's not competing - it's cheating. And it's costing American jobs in solar manufacturing. The American tax code should not make matters worse by encouraging the purchase of Chinese-made solar panels. Our plan will ensure that American tax incentives support American solar panel manufacturers."

This week, the Commerce Dept will rule on the claim that Chinese solar companies are selling panels at a loss to take over the market. It's expected to set tariffs at 10-12%.

In March, it ruled, "Because China is unfairly subsidizing solar production" tariffs will be set at 2.90%-4.73%. Rates vary depending on the subsidies the company receives from China's government. I

The two tariffs combined would add 10-12 cents per watt.

It's a victory for the Coalition for American Solar Manufacturing, which filed a petition for the tariffs with the Commerce Department and International Trade Commission last year. But they asked for tariffs of 100%.

The International Trade Commission will come to its own conclusion, probably in July.

The push for tariffs caused a rift in the solar industry. Installers have benefited from low prices and are against the tariffs.

Obama Administration's Green Energy Gamble

"The Obama Administration's Green Energy Gamble: What Have All The Taxpayer Subsidies Achieved?"

That's the provocative title of the latest hearing by the House Oversight and Government Reform Committee, clearly continuing their quest to attack renewable energy, as a memo revealed last week.

Executives from solar companies that received Dept of Energy (DOE) support, such as BrightSource Energy and Abound Solar will come under fire for tough times in the solar industry.

While the House Energy and Commerce Committee took the lead on probing Solyndra, the Oversight and Government Reform Committee is attacking the loan program in general.

DOE gave Brightsource a $1.6 billion loan guarantee for Ivanpah Solar Project, which is under construction.

"Going forward, we expect to finance our future projects commercially. As such, the loan guarantee program served an important role in the market, allowing our project to achieve meaningful scale, drive down costs, validate our technology and enable a new industry to succeed - in short, creating the necessary conditions to allow commercial financing," says BrightSource CEO John Woolard in testimony submitted to the House panel.

This House panel is one more "attempt to keep the political war against renewable energy in the headlines," says ThinkProgress. "Looks like 10 political sideshows on Solyndra weren't enough."

ThinkProgress gives five ways government support for clean energy has supported Americans:

• The 1603 grant program, which gave investors cash instead of tax credits, created 75,000 renewable energy jobs and 23,000 projects during the height of the recession. It supported $25 billion in economic activity at a time when banks weren't willing to use tax credits.
  
• The production tax credit helps leverage up to $20 billion in private investment a year, creating a US wind industry that supports 75,000 jobs - 30,000 in manufacturing.
  
• DOE's loan guarantee program is expected to cost $2 billion less than budgeted. An independent review of the program found its loan portfolio is expected to perform well and holds less risk than Congress originally anticipated when they approved the program under President Bush. It also found the DOE has done a good job of balancing the inevitable risks in the range of projects it selected. Other than Solyndra, of the two companies that declared bankruptcy, Ener1 came out stronger and Beacon Power is paying back 70% of the loan.
  
• Home weatherization has retrofitted 600,000 homes and is ranked second for job creation of the 200 federal programs funded through the Recovery Act.
  
• The Better Buildings Initiative will support over 100,000 construction jobs over the next two years as it upgrades over 1.6 billion square feet of public and private buildings.
  
• ARPA-E has supported dozens of potentially groundbreaking technologies. Five companies attracted over $100 million in private capital investment.

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