September 29, 2022

Solar Industry ‘Frozen’ as Biden Administration Investigates China

7 min read


Plans to install 60 square kilometers of solar panels in Vermont have been abruptly halted.

In Maine, a solar farm that will provide electricity to hundreds of homes has been partially built but may not be completed.

And a project in Texas that will provide electricity to more than 10,000 homes was weeks away from breaking the ground but has now been postponed until at least next year.

Across the country, solar companies are delaying projects, diverting supplies, shutting down construction sites and warning that tens of billions of dollars – and tens of thousands of jobs – are at stake.

The commotion is the result of the Commerce Department’s decision to investigate whether Chinese companies are blocking US tariffs by shipping components for solar panels to four Southeast Asian countries.

Although authorities have so far found no evidence of trade violations, the threat of retroactive tariffs has effectively prevented the import of Crystal Line silicone panels and components from Cambodia, Malaysia, Thailand and Vietnam. These four countries supply 82% of the most popular types of solar modules used in the United States.

In just a few weeks, 318 solar projects in the United States have been canceled or delayed, and hundreds of companies are considering a holiday, according to the Solar Energy Industries Association, which recently surveyed more than 700 companies.

Energy experts warn that the fallout is just beginning. A month-long break in imports from all four countries could have far-reaching implications for the Biden administration’s ambitious goals of accelerating the development of billions of dollars worth of solar industry and renewable energy to tackle climate change.

Leah Stokes, a political scientist who studies climate at the University of California, Santa Barbara, says the industry is basically frozen. “It’s already a holiday, not to mention the impact on our climate targets.”

The Commerce Department launched its investigation on March 25. Axin Solar, a small solar panel maker based in California, filed a petition seeking an inquiry into whether China should stop government-subsidized solar components from flooding the U.S. market. Is violating the rules for

Tariffs on Chinese solar panels Effective 2012, when the Obama administration introduced them in the hope of boosting domestic manufacturing and preventing China from dominating the emerging world market. In 2018, President Donald J. Trump imposed additional tariffs on certain solar products coming from China, and Mr. Biden Extension of these tariffs In February.

For more than a decade, China has dominated the global supply chain of solar panels. Government policies and subsidies Materials such as poly silicone and components such as solar cells that absorb energy from sunlight and convert it into electricity nurture large factories.

To avoid commercial problems, American solar installers have purchased many of their panels from four Southeast Asian countries. But according to Axin, many of these panels have been manufactured by overseas subsidiaries of Chinese companies and used cells, wafers and other parts originating from China.

So far, the Commerce Department has indicated that since parts from China were replaced by Southeast Asian companies, no tariffs were imposed on those parts.

But if the Commerce Department learns that panels from Southeast Asia include Chinese-made parts that should have been tariffed, the panels sold in the United States could face heavy duties once the investigation begins. And because of the risk of these additional costs, the supply of solar panels has stopped.

In an interview, Axin founder and chief executive Mamun Rashid said he had filed the petition because he believed the existing tariffs were being compromised and hoped the probe would help boost domestic manufacturing. Will help

“Perhaps trade laws are being violated, that fraud is taking place,” Mr Rashid said. “We decided that it would be irresponsible for us not to do or talk.”

Mr Rashid said he had worked on his own and was not working with any other energy companies, investors or industrial groups.

The process of resolving trade disputes is a complex system designed to prevent political interference. Commerce Secretary Gina Raymondo said this week that her department was legally obliged to take the matter further.

“My hands are tied here,” he said In a hearing On Capitol Hill on Wednesday. “By law, I need to investigate allegations that companies operating in other countries are trying to infringe, and I need a full investigation by law.”

A Commerce Department spokesman said it was “advancing efforts to strengthen the supply chain at the center of clean energy transfers, including the solar supply chain,” and that “hold foreign producers accountable under the same rules.” As an American producer. “

Last year, the United States Approximately 24 gigawatts of new solar capacity installationRecords aided by the falling cost of panels. But only one-fifth of these panels were manufactured locally, while the rest were mainly imported from Malaysia, Vietnam, Thailand and Cambodia.

Proponents of her case have been working to make the actual transcript of this statement available online.

Abigail Ross Hooper, chief executive of the Solar Energy Industries Association, said: “It’s a ridiculous conclusion that just one company’s application could bring the industry to its knees like this.” The US solar market is in turmoil. Shipments have stopped, installations have stalled, and people are starting to lose their jobs. “

The sudden jolt to the solar panel installation is colliding with Mr Biden’s goal of speeding up. Annual speed of solar installations across the country To fulfill its commitment to reduce US emissions by at least 50% from 2005 levels by the end of this decade.

Nick Blinger, chief operating officer of Hackett Energy, a Chicago-based solar company, said: Has been weakened. ” “Investigations are having a devastating effect on the renewable energy sector and electricity prices are rising. With daily tariff investigations continuing, the country is still lagging behind in achieving our climate targets. Is happening. “

Barriers are hitting big and small companies.

Next Era Energy, one of the largest renewable energy companies in the country, said it expects to build between two and three gigawatts of solar and storage – which will power more than a million homes. Enough to do – will not be completed as planned this year.

“This is totally affecting our solar business and industry,” said David Reiter, chief communications officer for NextEra. Shares of Next Era have fallen 15% in the last three weeks.

Work on projects at Vermont and Maine has stalled at Green Lantern Solar, a private solar installer based in Vermont.

Scott Buckley, president of Green Lantern, said: “This impact is significant not only for Green Lantern but for all of our contractors. “We had to call all our suppliers and say ‘thank you, but we can’t take delivery.'”

Overall, the Solar Energy Industries Association said its members are predicting a 46 percent reduction in the number of solar panels by next year.

However, another major solar company, First Solar, which manufactures a type of solar panel that was not affected by the tariff dispute, said it supported the investigation.

“What we’re interested in is making sure there’s a level playing field for domestic manufacturers,” said Raven Provenka, a spokeswoman for First Solar. “We feel that the Commerce Department’s decision to continue the investigation is a step in the right direction.”

For US companies looking for solar panels, there are some easy alternatives to products from Cambodia, Malaysia, Thailand and Vietnam.

“We’ve called every American panel manufacturer we can find, and none of them have a predictable timeline for us that will allow us to move these projects forward.”,Mr. Buckley of Green Lantern Solar said.

Some proponents of the solar industry have suggested that the Commerce Department has the potential to quickly change course and end investigations.

Heather Zechel, chief executive of American Clean Power, wrote that the secretary’s hands were tied. A blog post. “It has a way to prevent a senseless process that begins with the threat of a ghost – and it will use that power to revitalize the American solar industry in the coming weeks,” he said. Can breathe which has been affected by the actions of his department. “

But Ms. Raymondo said Wednesday in response to a question from Nevada Democrat Sen. Jackie Rosen that she could do just that. “What I promise you is moving forward as soon as possible,” he said.

Some analysts have argued that the United States would have to invest heavily in domestic manufacturing to compete with overseas production of solar products. Build a better bill in Congress, for example, Will provide new tax credit. For home-made solar wafers, cells and modules. But the legislation has been delayed since last year when West Virginia Democrat Sen. Joe Manchin III opposed it.

While the solar industry is awaiting a decision from the Commerce Department, proponents of renewable energy fear that time is running out. The Solar Energy Industries Association estimates that lost or delayed solar deployments will result in an additional 364 million metric tons of carbon emissions by 2035, with 78 million gasoline-powered vehicles on the road. Is equal to

“This will slow down the industry at a time when we need to move faster,” Ms Stokes said. “It can be devastating.”

Brad Plummer Cooperation reporting.



Source link

Leave a Reply

Your email address will not be published.