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Wednesday, November 30, 2022

Trade investigation puts solar power industry at risk, lawyers say

WASHINGTON ( Associated Press) – In a decision that could dramatically reduce the import of solar power to the US and undermine President Joe Biden’s ambitious climate goals, the Department of Commerce said Monday it was investigating whether to import solar panels from Southeast Asia circumvent dumping rules blocking imports from China.

Clean energy leaders who enthusiastically supported Biden’s agenda condemned the decision – which could lead to retroactive tariffs of up to 240% – and said it could lead to thousands of layoffs in the domestic solar industry and jeopardize up to 80% of planned solar projects. the U.S. Such an outcome would jeopardize one of Biden’s top clean energy goals and run counter to his administration’s pursuit of renewable energy such as wind and solar.

The Department of Commerce’s decision “suggests that the Biden administration’s talk of supporting solar energy is empty rhetoric,” said Heather Zichal, chief executive of the American Clean Power Association, a clean energy group.

Zichal, who was the White House’s energy adviser under President Barack Obama, called on Biden to return the decision immediately. “America’s solar workers and the clean energy community are watching and will remember,” she said, calling the implications of the investigation “apocalyptic” for the industry.

“Overnight, the Department of Commerce … pushed an interest through the heart of planned solar projects and stifled up to 80% of the solar panel supply to the US,” she said, adding that Biden “needs to fix it now.”

The Department of Commerce’s investigation follows a complaint by Auxin Solar, a small California manufacturer that said solar panels assembled in four Southeast Asian countries – Cambodia, Malaysia, Thailand and Vietnam – circumvent rules intended to block the import of solar cells and panels from China.

Mamun Rashid, chief executive of Auxin Solar, said he was grateful to trade officials for acknowledging the need to investigate what he called a “pervasive backlash” from solar panels by China, which he said “continued to injure U.S. solar producers” such as his company and others.

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“For years, Chinese solar power producers have refused to price their products fairly in the U.S. and have made considerable efforts to continue to undermine U.S. manufacturers and workers by … establishing operations in countries not covered by those duties. , “Rashid said. “Fair trade and the application of our trade laws are essential to rebuilding the U.S. solar power supply chain and making solar panels in America again.”

The Department of Commerce’s action comes weeks after Biden extended tariffs imposed by former President Donald Trump on most solar panels imported from China and other countries. In a nod to his efforts to combat climate change and boost clean energy, Biden has ruled out tariffs on some panels used in large-scale utility projects.

Biden’s February 4 announcement continued many Trump-era tariffs, but he released so-called bifacial solar panels that can generate electricity on both sides and are now used in very large solar projects. The technology was still emerging when the tariffs were first introduced by Trump.

Biden has also doubled an import quota on solar cells – the main components of panels that go on roofs and utility areas – to 5 gigawatts, enabling a larger number of imported cells used by domestic manufacturers. The US does not currently manufacture solar cells, and the White House wanted to make sure that domestic suppliers “do not have to pay a tariff on a key input for their manufacturing process,” a senior administration official said last month.

Biden had a choice between competing constituencies over solar power, an important part of its climate and clean energy agenda. Trade unions support import restrictions to protect domestic jobs, while the solar industry relies heavily on cheap panels imported from China and other countries, including Vietnam, Malaysia, Thailand and Singapore.

Biden has set a goal of reducing greenhouse gas emissions from the planet by at least 50% below the levels of 2005 by 2030, and solar power is an important part of that agenda. A report last year by the Department of Energy says solar power has the potential to provide up to 40% of the country’s electricity within 15 years – a tenfold increase compared to current solar power production.

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Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, which represents solar installers, called the Commerce investigation a “misstep” that could have a devastating impact on the U.S. solar power market and lead to tens of thousands of retrenchments. The decision could result in retroactive tariffs of up to 240%, a possibility that, according to Hopper, would have an immediate and “cooling effect on the solar industry.”

Additional tariffs could cause the loss of 70,000 U.S. jobs, including 11,000 manufacturing jobs, she said, and could lead to a dramatic drop in solar power plants and a corresponding increase in planetary greenhouse gas emissions from fossil fuels such as coal and natural gas.

“Solar power prices are rising, federal climate legislation has come to a standstill and trade restrictions are now increasing,” Hopper said. “Trade must end this investigation quickly to reduce the damage it will cause to American workers and our country’s efforts to tackle climate change.”

Trump approved tariffs on imported solar energy components in 2018, saying his administration will always defend U.S. workers and businesses against unfair competition. The rates were initially set at 30% and later cut to 18% and then 15%. They would lapse without action by Biden.

Under Biden’s decision, rates will be set at 14.75% and gradually reduced to 14%.

Since the tariffs were introduced, solar panel production in the US has tripled. Chinese and South Korean companies have set up factories in Georgia, Florida and Alabama, and a US firm, First Solar Inc., has expanded domestic production at an Ohio plant.

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