Biden To Waive Tariffs On Some Solar Panel Imports To Boost Stalled Projects

U.S. President Joe Biden is expected to announce on Monday a two-year pause in import tariffs on solar panels manufactured in Southeast Asia in an attempt to kickstart the American solar industry supply chain, sources with knowledge of the matter told Reuters.

The Administration will also move to protect solar power developers from possible trade penalty costs, along with providing federal aid to facilitate additional domestic solar panel manufacturing in the United States, according to the White House, through the Defense Production Act.

The move should serve to calm the fears in the U.S. solar industry that have been made jittery about the amount of money they must keep on hand to pay what could be potential tariffs down the road.

The tariff exemption for solar panels imported from Cambodia, Malaysia, Thailand, and Vietnam comes after the Department of Commerce (DOC) opened an investigation earlier this year into whether U.S. imports of panels completed in those four Southeast Asian countries—using parts and components from China—are circumventing the antidumping duty and countervailing duty orders on solar cells and modules from China.

The solar industry and many analysts have warned that the DOC investigation would stall many new projects in the United States. As much as 17.5 gigawatts (GWac) of planned US solar capacity installations in 2022 are in doubt following the DOC probe, Rystad Energy research showed last month.

“Contrary to the Biden Administration’s goal of growing clean energy in the U.S., the Department of Commerce has decided to consider up to 50%-250% tariffs on the solar industry in the United States. This misstep will have a devastating impact on the U.S. solar market at a time when solar prices are climbing, and project delays and cancellations are adding up,” Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association (SEIA), said at the time when the investigation was announced.

The DOC investigation could result in a decision for retroactive tariffs of up to 250 percent.

Biden’s move to exempt solar panel imports from tariffs for two years would also remove the threat of a retroactive tariff, according to one of Reuters’ sources.

Commenting on President Biden’s action to exempt imports from tariffs for two years, SEIA’s Hopper said today:

“We applaud President Biden’s thoughtful approach to addressing the current crisis of the paralyzed solar supply chain.”

“While the Department of Commerce investigation will continue as required by statute, and we remain confident that a review of the facts will result in a negative determination, the president’s action is a much-needed reprieve from this industry-crushing probe,” Hopper added.

By Tsvetana Paraskova for Oilprice.com

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