How Biden Could Save $437 Billion and Create Millions of Jobs by Reversing Trump Tariffs on Solar Panels

SolarCraft workers install solar panels on the roof of a home on February 26, 2015 in San Rafael, California. (Photo: Justin Sullivan/Getty Images)

How Biden Could Save $437 Billion and Create Millions of Jobs by Reversing Trump Tariffs on Solar Panels

The tariffs did not prevent the industry from growing, but it slowed its previously exponential growth and probably cost 60,000 jobs.

Michelle Lewis at Electrek discusses a new study that finds hundreds of billions of dollars in savings and millions of jobs created if the U.S. can power a quarter of its households with rooftop solar.

Australia already gets 5% of its electricity from rooftop solar, and some states, such as South Australia, specialize in it. For a brief time in October, South Australia got all of its electricity from solar, with 77% coming from rooftop installations.

Solar only provided about 2% of U.S. electricity in 2019, and only 1% comes from rooftop solar. The industry was dealt a body blow by the odious President Donald Trump's 2018 tariffs on solar panels. The tariffs did not prevent the industry from growing, but it slowed its previously exponential growth and probably cost 60,000 jobs.

Even though Trump's solar tariff helped some U.S. panel manufacturers compete, the American Solar Energies Association, representing some 1,000 firms, is asking President-elect Joe Biden to remove the tariffs on coming to office and not to wait a year for them to expire. Biden, however, says he will go slow on reversing the China tariffs, wanting to study the issue and, I presume, to use them as a bargaining chip in negotiations with Beijing. That's fine, but he should make an exception for the solar panel tariffs, since they have an impact on the climate emergency.

I have long believed that the move to rooftop solar in the U.S. is impeded by lack of financing. People should be allowed just to roll their cost into their mortgages. The panels last 25 years and pay for themselves after six, so you get free electricity for 19 years. They run off sunlight, which is free. The only reason everyone doesn't put them on is that they have an upfront cost of around $12,000 ($4,500 after the federal $7,500 tax rebate) and most people don't think in terms of what that would save them over 25 years. Most people just don't have thousands of dollars lying around to do this with, and hence the desirability of easy financing.

The Elektrek article is reporting on a study carried out by three groups: The Coalition for Community Solar Access, Vote Solar, and the solar company Sunrun (Nasdaq: RUN), which finds that accelerated solar energy plus storage will produce massive savings over the next three decades.

As Lewis notes, the report concludes that "deploying at least 247 GW of local rooftop and community solar on the grid would be the most cost-effective way to transition to a clean energy system by 2050. It is also the most cost-effective way to reach 95% emission reductions from 1990 levels. That's enough to power 25% of all US homes."

The good news is that solar and wind are falling so quickly in price that few new fossil fuel plants are being built, according to a study in Science. New electricity plants are overwhelmingly renewables. Moreover, the existing coal and gas plants are getting old, and most will be retired by 2035. Emily Pontecorvo at Grist reports on the study's findings.

In 2020 alone, 13 major coal plants have been retired.

The implication of the study is that it won't actually cost money or create stranded assets to close the fossil fuel plants by 2035, since 70% of them will be so old by then that they'll have close anyway, and will have long since been paid off.

Call me a utopian, but I think they should all be closed as soon as it is possible to replace their electricity generation with renewables, and I'd enlist the government in the project, at the least with massive subsidies. The awfulness of the climate emergency outweighs some investors' stranded assets in electricity plants.

The import of the Science article is, however, that it really isn't politically difficult to decarbonize electricity by 2035, since there are actually very few losers in that scenario. And there is lots of money to be made in wind, solar, and storage. Better, there is half a trillion dollars to be saved by backing sources like rooftop solar in a big way.

Bonus Video: Vox: "How America can leave fossil fuels behind, in one chart"

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