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Reports: Biden to pause new tariffs on solar imports for 2 years

President Joe Biden will reportedly pause for two years any new tariffs on solar modules imported from four Southeast Asian that are the subject of a federal trade investigation, according to multiple reports.
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President Joe Biden will reportedly pause for two years any new tariffs on solar modules imported from four Southeast Asian countries that are the subject of a federal trade investigation, according to multiple reports.

The reports from Reuters and the Wall Street Journal said an announcement could come as soon as June 6.

Commerce is investigating whether solar modules imported from Malaysia, Thailand, Vietnam, and Cambodia are circumventing trade duties against China. These four countries now account for more than 80% of the solar modules imported into the U.S.

The investigation could bring retroactive duties on modules imported after April 1, 2022, which brought the entire industry to a standstill "overnight," according to Kevin Smith, CEO of Lightsource bp Americas.

"Suppliers aren't going to take the risk of 50-250% tariffs, and owners/developers can't take that risk, either," Smith said. "You can't build a 100 MW, $100 million project with $50 million worth of panel supply, and then six months or a year later, they show up and say, oh, you owe us another $100 million for tariffs."


Subscribe today to the all-new Factor This! podcast from Renewable Energy World. This podcast is designed specifically for the solar industry and is available wherever you get your podcasts.

Listen to the most recent episode, featuring Lightsource bp Americas CEO Kevin Smith and American Clean Power Association CEO Heather Zichal.

In addition to the pause on new tariffs, Biden is also expected to invoke the Defense Production Act to support domestic solar manufacturing. Biden invoked the Defense Production Act in April to boost mineral production for renewable energy and electric vehicles.

The Biden administration has faced an onslaught of pressure from the solar industry since Commerce opened an investigation into the petition filed by Auxin Solar, a small manufacturer in San Jose, Calif.

A representative for Auxin Solar said that the company was still reviewing the reports that Biden will take action.

The Solar Energy Industries Association, American Clean Power Association (ACP), and other clean energy advocacy groups united to bring a $5 million campaign against President Biden and the Commerce Department to end the investigation.

ACP CEO Heather Zichal called the investigation and possibility of additional tariffs an "existential threat" to solar in the U.S. and accused Auxin Solar of gaming U.S. trade law.

"I've been working to deploy solar for two decades," Zichal told Renewable Energy World's John Engel during a recent episode of the Factor This! podcast. "And I never thought that I'd be having to raise money to run a campaign against the Biden administration."

Commerce Secretary Gina Raimondo has contended that the investigation is required by law, since Auxin Solar's petition met all of the requirements under federal statute. The investigation could bring new tariffs of 50-200%.

The two year pause on new tariffs from President Biden could give the solar industry the needed time to ramp up domestic manufacturing, advocates say.

Rhone Resch, who served as the CEO of SEIA from 2004-16, estimates that the U.S. could meet its own demand for solar modules within two years with the appropriate incentives in place.

"From my perspective, I think it's absolutely critical that we do focus on bringing (solar) manufacturing back to the United States." He said the U.S. can successfully compete with Chinese suppliers "as long as the right mechanisms are put in place."

One such mechanism would incentivize domestic manufacturing throughout the solar supply chain.

Sen. Jon Ossoff (D-GA)'s Solar Manufacturing for America Act (SEMA) is supported by domestic manufacturers, Auxin Solar included, and utility-scale developers alike. The bill passed the U.S. House of Representatives but has yet to garner a vote in the Senate.

The bill would create tax incentives of 11 cents/watt for integrated modules, 4 c/w for cells, $12/sq. m. of wafer, and $3/kg of polysilicon. Production of non-integrated solar modules would receive 7 c/w. Production of solar trackers and inverters would also receive credits.

"Any incentive that is brought forward, we will take it and run with it," said Martin Pochtaruk, CEO of North American module manufacturer Heliene. "It's better than the kick in the butt that we generally get."

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