A Biden administration investigation this spring into potential trade violations involving China threw the domestic solar industry into chaos, leading to hundreds of stalled or canceled projects across the nation.
Now, President Joe Biden issued an executive order Monday to lean on the Defense Production Act to accelerate domestic production of clean energy technology, in particular solar components.
What Biden is doing: The president is “temporarily” facilitating U.S. solar companies’ ability to source solar modules and cells from Cambodia, Malaysia, Thailand and Vietnam by assuring those components can be free of certain duties for 24 months to ensure domestic supply.
The problem of delayed projects in Utah and elsewhere happened after a U.S. solar manufacturing company complained to the Commerce Department that China was circumventing tariffs by funneling its components from those countries into the United States. Those four countries represent an estimated 80% of solar imports. A tariff on China-produced panels has been in place since the Obama administration.
Vendors began canceling contracts because of the fear of retroactive tariffs.
The announcement is welcome news for Utah’s solar industry.
“The tariff investigation has delayed at least five major solar projects under contract in Utah. Today’s decision will help put those projects back on track, providing clean domestic solar electricity to Utah customers, and jobs to our state,” said Josh Craft, government and corporate relations manager with Utah Clean Energy. “We look forward to working with members of Utah’s Congressional delegation and the Biden administration to ramp up domestic production of solar PV modules and domestic supply chains that are critical to a clean energy economy.”
The situation was dire across the country: The Solar Energy Industries Association told the Washington Examiner earlier this year in its daily energy newsletter that it cut its solar installation forecasts this year and next by 46% as a result of the Commerce Department investigation and uncertainty over tariffs.
Monday’s reaction from the industry: Abigail Ross Hopper, president and chief executive officer of the association, said the executive order improves that business certainty and helps protect solar jobs and the industry as a whole.
“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. During the two-year tariff suspension window, the U.S. solar industry can return to rapid deployment while the Defense Production Act helps grow American solar manufacturing.”
Heather Zichal, CEO of the American Clean Power Association, praised Biden’s move.
“President Biden’s proclamation today to use the full power of executive authority to jumpstart the domestic solar industry is a bold act of leadership. It recognizes the immediate need to protect middle-class American jobs, promote U.S. energy independence, protect consumers from rising electricity bills in the face of inflation, and stay true to his climate commitments,” she said.
Not everyone is pleased: Auxin Solar, the California-based solar module manufacturer whose petition triggered Commerce’s probe, accused Biden of “significantly interfering in Commerce’s quasi-judicial process,” it told the Washington Examiner.
“By taking this unprecedented — and potentially illegal — action, he has opened the door wide for Chinese-funded special interests to defeat the fair application of U.S. trade law,” the company told the newspaper.
Another U.S. manufacturer said the desire has always been to have a playing field that is fair and not tipped in favor of China.