2k vs. 260k

I am excited to see more and more debates coming up in PV community on LinkedIn.

Some are mind sparking. Whilst some are……confusing. For example:

2018 is bound to be another big year for PV installation. Some say 100GW, some say 140GW.

Why strong demand? Because PV cost has dropped by 80% over last decade. It’s lighting up many regions on the planet where were never before, supplying hundreds of millions of people with electricity of cost 3-4c/kWh, somewhere even <2c/kWh. Coal burning and hydrogen plants are looking like a decaying aristocracy with an expensive gown. It’s just start of the fall.

Why is PV energy so cheap? Because PV products are so cheap, cells, modules, inverters, systems, everything.

Why are PV products so cheap? Because China makes them so cheap.

Why are they making the products so cheap? Some say, because they have low labor and electricity cost; because they have huge capacity; because they have the great technology; because they stop at nothing to cut cost.

Ultimately, some say, they receive huge subsidies from the government.

Therefore, we should charge penalty tariffs against PV imports from China, and from any of their affiliate factories around the world.

As the result, the U.S. government is to launch Section 201 to impose importing tax against PV products from China, in order to protect PV factories within the borders.

India is to charge a whopping 70% tax against modules from China and Malasia (a weird combination:))

Here comes my outcry of today: what a foolish act of "charging AD tariffs to drive up PV cost in the country thus cut off PV deployment".

Let me tell you about this “Why”:

PV is about energy. Whatever products along the eco-chain, they would finally go to one single product: the electricity. It’s not like many user-experience related products e.g. automobile, where you can say my car is better than yours. You can only say my electricity is cheaper than yours -- of course tech of storage and grid integrity are needed but they just help to perpetuate the energy source.

Electricity is national. It doesn't flow across the borders (am I right? Or am I too old?). But cars do, pretty much. Car producers always try to penetrate international markets and sell cars into other countries. When a car maker finds some of its competitors in the country are buying imported engines with dumped price, it gets pissed. Because it would lose the competitive edge, both domestic and international sales would be impacted. As the result they would cry out for government interference and urge fair competition.

But energy itself just stays in the country no matter what. It only goes out of the country with carriers, cars, steel, PC, smartphones, IT services, and so on and on. The value of electricity is not what kind of technology has been used or how many local materials have been integrated. It comes from how much it helps to lower consumer's electricity bill. It doesn’t go across the borders but it improves fundamental of almost every industry within the borders. It helps local producers extend the competitive edge to overseas by reducing the fixed cost in a major way.

And for a vast population in many regions where electricity is scarce and expensive, this means they will have light in the night and warm food on the desk.

Not to mention, PV is green energy and helps substantially reduce carbon emissions on the planet.

Now imagine. I can get products from a foreign country that can help cut my electricity cost by half. Given the rapid rise of nationalism across the globe, the right poise should be a big big hug. What kind of technology? Who knows! Are they dumping to get the low price? Who cares!

If the latter were true, I would try hard to hide my chuckle and get as much supply of the product as I can. If I am noble enough, I would give the dumping country a big thump-up for its dedication to the world climate change and making solar energy affordable 5 years earlier.

Not to mention, Subsidizing large/potential industry is a common national strategy across many countries. Oil, steel, automobile……a long list. CA and other states in the U.S. have got the most generous PV incentives (e.g. ITC) in the world. And now they stumble to withdraw the lucrative incentives. Google "Solyndra scandal" we will have more info about how U.S. subsidizes PV factories too. Why just chase this single sector in a single country?

Imagine again. Is this a foolish blind spot of those decision makers while setting up national economic strategy? Did they fail to recognize the fact that electricity itself doesn’t flow across the borders? From a nationalist standpoint, the right approach seems to be keeping the low-cost electricity within the country thus increase national strength by reducing energy cost of the whole country.

Or, it’s just that China is taking its global climate commitment seriously. It burns huge money to make cheap products within the borders, while feeds the world with cheap electricity.

What a lofty heart.

Here come the most interesting debates of all. Some applaud the appeal of Section 201 to charge huge tariffs against Chinese PV products. As result a few PV factories could be saved but PV system cost could go up by 10-15%. Also as result, thousands of PV projects could be cut off, hundreds of thousands of installation workers would lose the job .

In the U.S., PV jobs of factories vs. installation are 2k vs. 260k. Which side should we protect? I am totally confused. Not to mention hundreds of thousands of house owners who could face higher cost for their rooftop installation and higher electricity bill.

What shall we tell these potential customers? Like, you should stop buying that cheap module because it’s made in China and China is dumping it. You should buy this expensive one because it’s made in U.S.A.

More importantly, what shall we tell the people in energy starving areas? They just crave for an affordable electricity supply to light their room and warm the house. We now come tell them: you can’t have these panels because some countries are dumping them.

It sounds like a prig tells a poor man in a cold winter that he should give up his clothes and run to stay warm.

When you are producing modules that were produced in China two years ago, when you are making modules which are 15% more expensive than those made in China, imposing tariffs is like committing a crime upon the population who live in remote area and face scarce supply of electricity.

Of course, there are more people having clear mind than those who don’t in PV community. Even Abu Dhabi the oil-dependent country is now trying to embrace PV energy. Hopefully AD’s attitude ---when I can’t beat it, embrace it ---would spark some thoughts in PV community. They should receive extra credits given the fact that oil incumbents are now struggling to prevent themselves from losing market to renewables.

What’s your debate?