Solar companies say new tariff proposal would devastate industry

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The Solar Energy Industries Association said on Wednesday that the implementation of tariffs on panels and cells from Malaysia, Vietnam and Thailand, which account for 80 percent of U.S. panel imports, would have a “catastrophic impact” on the industry.

In a letter to Commerce Secretary Gina Raimondo, more than 190 U.S. solar companies urged the Commerce Department not to open a trade investigation.

Wednesday’s letter comes after several companies filed an anonymous petition with the Commerce Department in August alleging Chinese manufacturers of solar cells and modules are avoiding U.S. tariffs by shifting production out of the country. The Department is expected to decide by the end of the month whether it wishes to open an investigation.

“The massive rights demanded in these petitions, ranging from 50% to 250%, are already having a negative impact on the US solar industry and, if implemented, would devastate the industry and each of our individual businesses,” said the letter said.

SEIA estimates that if the proposed tariffs go into effect, it would cost the industry 18 gigawatts of solar deployment by 2023, which is equivalent to all US solar installations by 2015. This also represents a significant portion of the expected construction in the over the next few years. years. The industry is expected to add 30 GW of solar power in 2022 and 33 GW in 2023, according to estimates from energy consultancy Wood Mackenzie.

“We believe the significant uncertainty is a real risk for US utility developers – projects could be pushed back further with increasing disruption beyond poly [polycrystalline] and freight / logistics, ”Bank of America analysts noted.

The petitioners claim that most of the assembly of solar products imported from Malaysia, Vietnam and Thailand actually takes place in China, which is why these products should be subject to tariffs. SEIA disputes this, claiming that substantial work is being done outside of China.

“We cannot stress enough how damaging these tariffs would be to our businesses and the entire US solar industry,” the letter said.

It comes as the industry faces several headwinds, including supply chain disruptions and higher raw material costs.

In June, U.S. Customs and Border Protection issued a restraint order on Hoshine Silicon Industry’s silica products due to forced labor issues in China’s Xinjiang region.

In the second quarter, solar energy costs increased quarter-over-quarter and year-over-year across all market segments for the first time since Wood Mackenzie began tracking price data in 2014. In addition, some key provisions, including an extension of the investment tax credit, have been left out. of the infrastructure bill. Industry hopes the $ 3.5 trillion spending program will include substantial funding for clean energy projects.

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