Clean Energy
Senate Joins House in Repeal Vote of Solar Import Tariff Pause
Senate and House repeals of Biden administration order for two-year pause in import tariffs on solar energy facility components from Asia, were criticized by US sector advocates, who cite disrupted construction of domestic projects such as the planned $400M first phase of Mammoth Solar in Indiana.
Image Courtesy Doral Renewables
In a 56-41 vote on May 3, the U.S. Senate joined the U.S. House of Representatives in voting to repeal President Joe Biden's two-year halt on tariffs for solar energy panels imported from four Southeast Asian countries that are suspected of being made in China to circumvent the duties.
The pause was ordered to not interrupt work on U.S. solar projects that need the components while the government probes the alleged circumvention.
The Senate measure had support of nine Democrats and all Republicans, except Sen. Rand Paul of Kentucky. The Republican-led House approved its resolution on April 28, 221-202, including 12 Democrats. President Biden has said he will veto the measures, based on an earlier White House statement, with speculation that there still are not enough congressional votes to override it.
“These are tariffs that give China an unfair competitive advantage,” said Homeland Security and Governmental Affairs Chair Gary Peters (D-Mich.). “We want to build the industry in America. We want Americans to be building solar cells.”
But Congressional supporters and solar industry advocates voiced strong concern that despite moves by American and foreign-based component producers to expand U.S. production, ending the tariff pause could still delay or cancel solar projects, with domestic manufacturing not yet able to support component demand.
At present, tariffs would not take effect until after June 6, 2024.
“Unfortunately, politics won the day, and our legislators voted to pull the rug out from businesses that are investing billions of dollars and employing thousands of people in their states,” said Abigail Ross Hopper, CEO of the Solar Energy Industries Association. “The remaining 14 months of this moratorium gives us time to close the gap.”
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George Hershman, CEO of SOLV Energy, the largest U.S. utility-scale solar facility builder, said after the House vote that "political attempts to undermine the President’s clean energy agenda threaten to undercut America’s strength in solar deployment."
Biden in June 2022 ordered the halt to import tariffs set by the U.S. Commerce Dept. earlier that year on component imports from Cambodia, Malaysia, Thailand and Vietnam.
Commerce had ordered the tariffs, which could be between 50% and 250% of an exported component's value, after agreeing to a domestic manufacturer's call for a probe into the circumvention.
The agency now says it will decide by Aug. 17 whether to confirm its preliminary finding that solar components from the four countries are evading anti-dumping duties on photovoltaic cells by processing Chinese-made units in a minor way before export to the U.S.
That decision, originally expected by May 1, was pushed back “due to the extraordinarily complex nature of these inquiries,” says a department spokesman.
The 2022 Inflation Reduction Act offers tax credits for domestic production of solar cells, modules and components.
To boost domestic solar manufacturing, the administration also directed development of master supply agreements to “increase the speed and efficiency” of products sold to the U.S. government and set “super preferences” to apply domestic content standards for federal procurement of solar energy systems.
The administration also said it will “strongly encourage” use of project labor agreements and community benefits agreements that offer wages at or above the prevailing rate and include local hire provisions.
The efforts are expected to triple U.S. solar manufacturing capacity by 2024.
