In a letter addressed to US President Joe Biden, Senators Jon Ossoff and Reverend Raphael Warnock have called for the elimination of a tariff exemption on bifacial solar modules, which they state make up nearly 90% of photovoltaic (PV) module imports. The senators argue that by removing this exemption, pricing pressure would be reduced, and the growth of the domestic solar manufacturing industry in the United States would be significantly supported.
The letter, written to President Biden, emphasizes that "Removing this exemption would alleviate pricing pressure and bolster the growth of an important US industry." The senators' assertion is based on a recent report from the US International Trade Commission, which found that imports of bifacial modules had doubled between 2020 and 2022.
Earlier in the month, Ossoff and Warnock urged the Biden administration to take action by eliminating the tariff exemption for bifacial modules under Section 201 of the Trade Act of 1974. This move, they argued, would enhance the competitiveness of US-made bifacial module manufacturers. This call to action was part of a broader push by four US senators, including Ossoff and Warnock, along with Sherrod Brown and Marco Rubio, to increase tariffs on Chinese-made PV modules, cells, and wafers.
The Solar Energy Manufacturers for America (SEMA) Coalition also called for a strengthening of the domestic supply chain to produce solar components last week. This call came after the release of a report highlighting the reliance on Chinese-made modules and identifying gaps in the domestic production of modules, wafers, and cells. The issue was also emphasized in a guest article for PV Tech last December by advisory body, Clean Energy Associates, which noted an imbalance in domestic module capacity versus cells in the US.
"The solar manufacturing industry is at a crucial turning point, driven by incentives in the Inflation Reduction Act," Ossoff and Warnock stated. "During the final two years of the 201 tariffs, it is essential that their implementation supports the growing US solar manufacturing industry, which is critical to our nation’s energy security and independence from China." They added that companies in Georgia have already invested over $2.98 billion in solar manufacturing, projecting thousands of new clean energy jobs for their states.
This request from senators Ossof and Warnock echoes comments made by Mark Widmar, CEO of cadmium telluride (CdTe) thin-film solar manufacturer First Solar, during a US Senate Finance Committee meeting. Widmar expressed that the US solar manufacturing industry "remains in a precarious position, despite the passage of the Inflation Reduction Act (IRA)."
The United States has implemented several policies and measures related to photovoltaic (PV) components imported from China, which have evolved over the years. Here is a summary of the key policy developments:
Anti-Dumping and Countervailing Duty Investigations (2011-2012):
In 2011, the U.S. Department of Commerce initiated anti-dumping and countervailing duty investigations on crystalline silicon photovoltaic cells and modules from China.
In 2012, the U.S. imposed anti-dumping and countervailing duties on Chinese PV modules, which led to significantly higher tariffs on these imports.
Section 201 Trade Act of 1974:
This act allows the U.S. President to impose tariffs on imported goods that threaten domestic industries.
The Section 201 tariffs on PV cells and modules from China were implemented in 2018, which further increased the cost of Chinese PV imports.
Trade Agreement with China (2020):
As part of the Phase One trade deal between the U.S. and China, signed in January 2020, both countries agreed to de-escalate their trade tensions.
The agreement included provisions for increasing U.S. exports of energy products and services to China, but it did not immediately lead to a reduction in tariffs on PV components.
Public Law 116-13 (2019):
This law requires that a certain percentage of renewable energy used by federal agencies must come from domestic sources, potentially boosting the U.S. PV manufacturing industry.
Inflation Reduction Act (2022):
The Inflation Reduction Act, signed into law in August 2022, includes incentives for clean energy deployment, including tax credits for solar projects.
While the act does not directly address imported PV components, it aims to support the domestic clean energy sector, which could include American-made PV technologies.
Bifacial Solar Module Exemption:
Bifacial solar modules, which generate electricity from both sides of the panel, have been exempt from the Section 201 tariffs since 2019 due to their minimal production in the U.S.
U.S. manufacturers have called for this exemption to be removed, arguing that it gives Chinese manufacturers an unfair advantage.
Ongoing Tariff Reviews:
The U.S. Department of Commerce periodically reviews the existing tariffs on Chinese PV components and may adjust them based on market conditions and international trade obligations.
Advocacy and Lobbying:
U.S. solar industry stakeholders, including manufacturers and installers, actively engage in advocacy efforts to influence trade policy, often seeking a level playing field through tariffs or other measures.
International Trade Commission Reports:
The U.S. International Trade Commission (USITC) has released reports analyzing the impact of imports on the domestic PV industry, providing data and recommendations that can influence policy decisions.
It's important to note that the U.S. solar industry is complex, with various interests vying for policy changes that benefit their operations. The interplay between domestic manufacturing, imports, and government incentives continues to shape the landscape for PV components in the U.S. market.