WASHINGTON — Faced with paralysis in the U.S. sun industry, President Joe Biden ordered that any potential trade violations by Chinese manufacturers of solar panels be left unpunished for two years. This is in direct contravention to a law Congress passed to protect American workers.
Biden’s Monday move to ban new tariffs on solar panels also shook off an ongoing investigation by Commerce Department. This was required by law. Biden’s administration tried in the past to avoid interfering with what is supposed to be an independent and quasi-judicial process.
According to the Commerce Department, the investigation will continue unabated. However, no one will be punished.
Senior Biden administration officials described the decision to suspend tariffs as creating “a bridge” — temporarily allowing cheap foreign solar panels into the U.S. in order to accelerate the transition to renewable energy and using the two-year period to grow a fledgling U.S. manufacturing industry.
To make it possible, President Biden must declare an urgent to justify sidestepping the tariff law.
Karine Jean-Pierre, White House Press Secretary, stated Monday that the emergency was a threat to sufficient electricity generation capacity to meet customer demand.
This sudden, unexpected ending to a growing dispute over tariffs has been achieved. Solar panel installers and climate activists have accused the Commerce Department of almost destroying an industry critical to the Biden administration’s goal to produce clean electricity by 2035.
The United States has had a history of trade disputes with solar power.
Installers of solar panels, who are able to sell their customers the most affordable panels, often face major problems from manufacturers. They can’t compete against cheap imported products, whose low prices are subsidized in countries like China.
According to the U.S. Energy Information Administration (USEIA), more than 80 percent of the panels shipped to the U.S. come from overseas. This includes huge quantities from Thailand, Vietnam, Malaysia, and Thailand.
The Commerce Department was forced into opening an investigation in this case after Auxin Solar (an obscure manufacturer of solar panels in California) filed a complaint alleging China was illegally bypassing existing tariffs that were meant to level the playing field for U.S. producers.
Auxin’s complaint, echoing an earlier failed complaint by an anonymous group solar panel maker, claims that Chinese state-supported panel manufacturers have been shifting their factories to Malaysian, Vietnam, Thailand, and Cambodia. The complaint claims that they can use this method to claim the panels were not made in China and dodge U.S. tariffs.
These products are allegedly still subsidised by China and then “dumped” onto American markets at far lower prices than what it costs U.S. panel makers to make them.
This investigation revealed that panels from these countries could face retroactively high tariffs. Industry experts fear this has caused a chilling effect which has slowed major solar installations to a crawl.
Climate groups and solar panel installers protested and demanded the Biden administration intervene. Commerce Secretary Gina Raimondo, whose job it is to drive U.S. growth, was forced into the uncomfortable situation of overseeing a probe critics claimed was damaging the solar industry. Raimondo denied that she could interfere for weeks.
Raimondo stated to Congress that “my hands are very tied” during an April budget hearing.
A source familiar with Raimondo’s involvement in the case told NBC News that Raimondo had not pushed for or directed the investigation internally but had taken steps to ensure that Congress had passed the statute. The official stated that Raimondo’s public statements remained focused on the administration’s clean energy goals and the growth of the U.S. sun industry throughout this period.
Biden’s Monday move effectively removes the issue from the table for two more years by making sure there are no new tariffs on solar energy in the Southeast Asian countries regardless of the outcome of the investigation. Lisa Wang, Assistant Commerce Secretary, stated that if new tariffs are found to be in order by the investigation, they would kick in after the two-year period.
Mamun Rashid (CEO of Auxin) blasted Biden’s “significantly interfering in” the investigation and asked if the president had done anything illegal.
Rashid stated that China-funded special interests have been able to open the doors for the unfair application of U.S. Trade Law.
Raimondo reacted to the announcement, calling imported solar panels “an essential component to addressing immediate needs of bringing more energy sources online”.
She stated that she was committed to upholding trade laws and making sure American workers are able to compete on an equal playing field.
Senator Sherrod Brown (D-Ohio), a strong advocate for U.S. manufacturing rights and workers’ rights, had asked the Biden administration to not allow politics to get in the way.
“If unduepolitical influence in this case is allowed prevail, it will lead to more risk and vulnerabilities tomorrow,” Brown and four other Democratic legislators wrote to Biden last month.
Brown, who did not criticize Biden’s decision Monday, said that the fact that most solar panels are still imported was “something that must change.”
