White House to make changes to tariffs on solar projects

WASHINGTON — President Joe Biden announced last week that he would extend tariffs on imported solar products first imposed during the Trump administration but reduce the scope of products affected, a decision aimed at balancing his goals for bolstering domestic manufacturing with speeding up the transition toward clean energy.

The decision will impose a tariff of 14 to 15 percent for the next four years on imported crystalline silicon solar products that are used to convert sunlight to energy. But the Biden administration also moved to double the amount of solar cells that can come into the country without facing tariffs and said it would begin talks with Canada and Mexico to export their products to the United States duty-free.

The administration also said it would exempt a certain type of two-sided panel, called bifacial panels, from the tariffs, saying the move would help ensure that solar deployment in the U.S. “continues at the pace and scale needed to meet the president’s ambitious climate and clean energy targets.”

The carve-outs will maintain some protection for the domestic industry while also allowing solar energy projects to continue accessing some cheap foreign solar products. But they are also likely to anger some domestic manufacturers and the president’s allies in the labor movement, who argue that the administration should be doing more to shield U.S. manufacturers from cheap Chinese products.

Mark Widmar, CEO of First Solar, a solar panel manufacturer in the U.S. that had fought for tougher restrictions on imported products, said he was “deeply disappointed” in the decision and that it would allow China “to outflank American efforts to grow self-reliant solar supply chains.”

“Today’s decision places at risk billions of dollars in existing investment, thousands of jobs, our country’s energy security and a climate-critical transition to net-zero emissions,” he added.

Companies that install solar power projects with foreign panels praised the decision to scale back the tariffs.

“Every dollar spent on tariffs means less dollars put towards creating jobs and opportunity in communities,” said George Hersh-man, CEO of SOLV Energy, the nation’s largest utility-scale solar installer. “The bifacial exclusion will help us greenlight projects and deploy more solar capacity across the country.”

The issue of how to treat imported solar products has divided some of the administration’s traditional allies. Labor unions, along with those who prioritize efforts to build a domestic solar industry and reduce trade with China, have pushed back against solar energy developers and others who see combating climate change as among the administration’s most important tasks.

Biden has pledged to cut U.S. emissions at least 52 percent below 2005 levels by the end of this decade, and the administration is counting on solar power to play a significant role in reducing emissions from electricity production. A recent Energy Department report found that solar energy could provide up to 40 percent of the nation’s electricity by 2035, compared with its current 4 percent.

But much of the world’s supply of solar panels comes from China, which has spent heavily on industrial subsidies to support its industry.

According to estimates by Wood MacKenzie, a consultancy business for global energy, China dominates all stages of the solar supply chain, producing 60 to 80 percent of the world’s polysilicon, wafers, crystalline silicon cells and solar modules.