Washington — Monday’s Biden administration announced that it would suspend imposing new tariffs on solar energy for two years. This is a decision that threatens the spread of solar energy in the United States in response to protests from importers who have sought taxation.
This move is a win for domestic PV installers, and tariffs jeopardize the Biden administration’s goal of significantly reducing carbon emissions by the end of the decade by reducing the influx of products into the United States. He said he would expose him. But that goes against the intentions of some American solar makers and their advocates who have pushed the government to put more strict barriers to cheap imports to help revive domestic industry.
This was the latest example captured during a competing urge to move the United States away from global warming fossil fuels, as President Biden promised. By limiting prices, Biden will try to secure a sufficient and cheap supply of solar panels during high inflation and get the stagnant solar projects back on track. However, this decision will punish Chinese companies for trade violations and postpone other White House efforts that may have weakened Beijing’s role in the global supply chain.
To counter complaints from the domestic PV industry, the government said Biden would try to accelerate the production of US PV components, including calling the Defense Production Act authorities. Private enterprises.
The outlook for additional tariffs stems from ongoing investigations by the Ministry of Commerce investigating whether Chinese solar companies already subject to tariffs have tried to avoid these levies. Move business from China to Southeast Asia..
Auxin Solar, a small manufacturer of solar panels based in California, has requested an inquiry investigating imports from Vietnam, Malaysia, Thailand and Cambodia.
By 2020, 89% of the solar modules used in the United States will be imported, with Southeast Asian countries accounting for the majority of shipments.
If the Department of Commerce determines that the factory has been set up to avoid US tariffs, the government can impose tariffs retroactively on shipments to the United States. However, under the tariff “suspension” ordered by Mr. Biden on Monday, such taxation would not be levied for the next two years.
This decision is the latest turn in a long mogura game where the US government has played against low-priced imports in the solar industry.
U.S. companies were some of the first companies to introduce solar technology, but in recent decades China has subsidized production and created a vibrant domestic market for solar installations. It came to dominate the world’s solar production. In 2011, the United States imposed obligations on Chinese products to combat subsidies and unreasonably low prices. Later, US installers began to buy more products from Taiwan, but in 2015 the US also imposed obligations on Taiwan.
Trade experts say that suspending tariffs aims to protect U.S. workers by allowing Chinese companies to continue to flood the U.S. with cheap imports. He said it could be weakened.
On Monday, Auxin CEO Mamun Rashid said President Biden was blocking the investigation.
“By taking this unprecedented and potentially illegal action, he has opened the door to China-funded extraordinary interests to defeat the fair application of US trade law,” Rashid said. He said in a statement.
To suspend tariffs, Biden administration officials say the government has invoked a section of the Tariff Act of 1930 that allows the president to suspend certain import tariffs to deal with emergencies. Stated. Commerce officials said the investigation would continue and tariffs resulting from the investigation would begin after the 24-month hiatus.
“The president’s urgent declaration guarantees that American families have access to reliable, clean electricity, while at the same time guaranteeing the ability of trading partners to take responsibility for their promises,” Secretary of Commerce Gina Raimondo said. Said in.
Tariff potential has impacted the ugly battle of the last few months over the future of the US solar industry.
US solar companies say more and retroactive tariff prospects are already having a chilling effect on imports. Groups such as the Solar Energy Industries Association, including several Chinese manufacturers operating in the United States, are lobbying against tariffs on the White House, and the government will impose a new tax on Monday. We welcomed the news of the suspension.
“”Today’s actions will protect existing PV jobs, increase employment in the PV industry, and foster strong PV manufacturing bases at home, “said SEIA President and Chief Executive Officer. One Abigail Ross Hopper said in an email.
“During the two-year tariff suspension, the Defense Production Act will support the growth of US solar production, while the US solar industry can return to rapid development,” she said.
Companies that rely on imported products, and U.S. authorities prioritizing the transition to solar energy, have decided to move away from fossil fuels as a Ministry of Commerce investigation raises uncertainty about future pricing in the solar energy market. He complains that he is delaying. NextEra Energy, one of the country’s largest renewable energy companies, said it expected to delay the installation of 2-3 gigawatts worth of solar and storage construction enough to power more than a million households. rice field.
Scott Buckley, president of Green Lantern Solar, a Vermont-based solar installer, said: Buckley said his company was forced to put about 10 projects on hold, resulting in the installation of about 50 acres of solar panels.
Buckley said there was no easy solution to dependence on imported products in the short term, and Monday’s White House action could allow companies like him to resume installation this year.
“This is to return to work order,” he said. “That’s the way I think about it. Let’s clear the log jam.”
However, domestic solar power companies and U.S. labor unions have seen a recent surge in imports from Chinese companies manufacturing in Southeast Asia by shifting the production or assembly of products to another product. Countries that state clearly violate US trade law, which prohibits attempts to avoid tariffs.
Domestic producers accuse importers, who have close commercial ties with China, of shaking the Biden administration and exaggerating the industry’s difficulty in maintaining the rate of return resulting from unreasonably priced imports. is doing.
“If you have a supply chain that relies on dumped and subsidized imports, there is a problem with the supply chain,” said Scott Paul, president of the Alliance for American Manufacturing.
Michael Stumo, CEO of Coalition for a Prosperous America, a non-profit organization that promotes domestic manufacturing, said: “Whether it’s a drug, PPE, or solar panel, it needs domestic production.”
Some critics also said the legal basis for the White House move was questionable, arguing that the government effectively declared a state of emergency because of the consequences of its own trade law.
Scott Lincicom, a trade policy expert at the Cato Institute, a libertarian think tank, said the administration’s actions seemed to be “a significant range of laws.”
According to the provisions of the trade law enforced by Mr. Biden, the President “declares a state of emergency or for other reasons” and “food, clothing, and medical care,” during such a state of emergency. “Other equipment for use in surgery and emergency relief activities” is tax exempt.
He has long proposed a “public interest” test that would allow U.S. tariff critics to lift taxes to mitigate broader economic harm, but Congress has taken such action. Said he never approved.
In a letter at the end of last month, Senator Sherrod Brown of Ohio and Senator Bob Casey of Pennsylvania are both Democrats, and solar importers “to encourage political intervention in the trade enforcement process.” I spent millions of dollars on advertising and lobbying, “he complained. Biden administration officials have previously stated that the Commerce Department’s investigation was unaffected by political interference and described it as “quasi-judicial” and “non-political.”
Solar tariffs have been a source of controversy for decades, but in recent years they have become of new importance as the effects of climate change become more apparent. Chinese companies have expanded internationally and are now able to continue shipping products to the United States, but US companies are struggling to compete.
China’s dependence on the global solar industry has led the Byden administration to ban products related to forced labor in the Xinjiang Uighur Autonomous Region, which U.S. officials say Chinese authorities have detained more than one million Uighurs and other minorities. Complicated the effort. Xinjiang Uygur Autonomous Region is a major producer of polysilicon, the raw material for solar panels.
Solar importers complained last year that a ban on forced labor-made solar raw materials by Hoshine Silicon Industry temporarily suspended a multi-billion dollar US project. Hoshine.
After Russia’s invasion of Ukraine in February, soaring gasoline prices hampered a broad desire to keep the country away from oil, and Mr Biden called on oil-producing countries in the Middle East and beyond to increase production.
White House officials said on Monday that Mr Biden would sign a series of directives aimed at promoting the domestic development of low-emission energy technologies. He aims to make it easier for domestic suppliers to sell solar systems to the federal government. He then orders the Ministry of Energy to use defense production laws to “rapidly expand American production” of solar panel components, building insulation, heat pumps, grid infrastructure, and fuel cells. The government said in the fact sheet.
