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US solar panel makers seek import tariffs to protect new domestic factories

Tan KW
Publish date: Thu, 25 Apr 2024, 11:49 AM
Tan KW
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Some of the world's largest solar equipment makers asked President Joe Biden's administration on Wednesday to impose tariffs on panels and cells from four Asian countries, to protect billions of dollars in investments in US manufacturing.

Seven companies - Korea's Hanwha Qcells, Switzerland's Meyer Burger, Norway's REC Silicon, and US companies First Solar Inc, Convalt Energy, Mission Solar and Swift Solar - are behind the petitions filed with the US Department of Commerce and the International Trade Commission, they said in a statement.

The American Alliance for Solar Manufacturing Trade Committee is accusing Chinese companies with factories in Malaysia, Cambodia, Vietnam and Thailand of flooding the US market with panels priced below their cost of production. That has caused prices to collapse by more than 50%, threatening their US-made products, they said.

If the case is successful, companies that import panels to install on rooftops or build large-scale solar power plants could face higher prices within months.

The Biden administration has raised the alarm in recent weeks over China's massive investment in factory capacity for clean energy goods, and Treasury Secretary Janet Yellen has said that the US is evaluating trade remedies.

Biden's landmark climate change law, the Inflation Reduction Act, includes incentives for companies that produce clean energy equipment in the United States.

Since its passage in 2022, solar companies have announced more than 40 factories, representing nearly US$13 billion in investment, according to projects tracked by the clean energy business advocacy group E2.

But in recent months, many of those companies have voiced concerns about stepped-up competition from China that is already hammering factories in Europe.

The petitioning companies are asking the US Commerce Department to impose anti-dumping and countervailing duties that would offset the impact of foreign subsidies and ensure the products are priced at fair market value.

The trade case is expected to last about a year, though tariffs could be levied as soon as Commerce makes a preliminary ruling in about four months for countervailing duties, and six months for anti-dumping duties.

"There is no question, despite the passage of the Inflation Reduction Act, [that] the US solar manufacturing industry is injured and remains in a very precarious position," Tim Brightbill, the group's attorney, said on a call with reporters.

The US has had tariffs in place on Chinese-made solar equipment for a decade, and in 2018, then-president Donald Trump imposed additional duties on overseas-made panels.

More recently, the US last year finalised import duties on some solar panel makers who finished their products in the same four Southeast Asian countries targeted in the new trade case, to avoid the tariffs on Chinese goods.

Biden, however, in 2022 imposed a two-year waiver on those tariffs due to pressure from project developers concerned about a disruption in supplies. That waiver will expire in June, and the White House has said it will not be extended.

Biden's administration is also expected to reverse an exemption for imports of two-sided panels.

"Unfortunately, those actions are not enough to address the more than 50% price drop that we've seen and the rampant dumping and subsidies involving these four countries," Brightbill said.

Trade remedies on solar have been a delicate balancing act for Biden, as he seeks to revitalise US manufacturing and create jobs, while also encouraging the deployment of clean energy to combat climate change.

Solar project developers have long opposed tariffs because they rely on cheap imports to keep their costs low.

Four clean energy trade groups, whose members include developers and installers, said they opposed the new petition.

"Today's filing creates market uncertainty in the US solar industry and poses a potential threat to the build-out of a domestic solar supply chain," the groups said in a statement.

They are the Solar Energy Industries Association, American Clean Power Association, Advanced Energy United and American Council on Renewable Energy.

 


  - Reuters

 

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