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Sparks

Biden Takes a Side in the Solar Industry’s Family Feud

The administration is expanding tariffs to include a type of solar modules popular in utility-scale installations.

Solar panels.
Heatmap Illustration/Getty Images

The Biden administration continued its campaign to support domestic green energy manufacturing via trade policy on Thursday, this time by expanding existing solar panel tariffs to include the popular two-sided modules used in many utility-scale solar installations.

With this move, the Biden administration is decisively intervening in the solar industry’s raging feud on the side of the adolescent-but-quickly-maturing (thanks, in part, to generous government support) domestic solar manufacturing industry. On the other side is the more established solar development, installation, and financing industry, which tends to support the widespread availability of cheaper solar components, even if they come from China or Chinese-owned companies in Southeast Asia.

These particular solar modules, known as bifacial modules, are estimated to account for over 90% of U.S. module imports. That amounted to some $4.3 billion of incoming orders in the first six months of last year, according to a report by the International Trade Commission, an almost three-fold increase from the first six months of the year prior.

Tariffs on solar modules were first imposed by the Trump administration in 2018 and later extended in 2022, with the levy rate falling to around 14% from the initial 30%.

Domestic and global solar supply chains are under threat from “unfair and non-market practices,” as well as “Chinese solar panel overcapacity,” National Climate Advisor Ali Zaidi said on a call with reporters — hence the expanded tariffs.

The solar manufacturing industry and elected representatives in states that have seen large solar manufacturing investments have been pushing to end the exclusion. Georgia Senators Jon Ossoff and Raphael Warnock, for instance, wrote a letter to President Biden in March calling for the bifacial exemption to be removed, arguing that “the elimination of the exemption for bifacial panels would strengthen the United States’ and Georgia’s economy, protect U.S. national security, and serve the nation’s long-term economic and energy security interests.”

The Korean solar company Qcells is planning to invest more than $2 billion in solar manufacturing in Georgia. The American solar manufacturer First Solar has long campaigned for bifacial modules to be included in the tariffs.

White House climate advisor John Podesta cited the International Trade Commission report during the briefing with reporters to demonstrate that an increase in bifacial imports had occurred while imports of other types of modules had fallen. “The findings … made clear that the bifacial exemption was likely being abused, and that that tariff exemption was no longer appropriate,” Podesta said.

The White House is not completely deaf to the preferences of the other side of the solar industry, however.

Developers who have contracts to buy bifacial panels that will be shipped within 90 days will still be able to import them without duties, Podesta said, “to avoid undue disruptions to the industry.”

The tariffs also allow a quota of solar cells, which are later assembled into modules, to be imported without charges. Zaidi said that “raising … the tariff rate quota to facilitate the availability of solar cells for manufacturers here in the United States will be necessary to make sure we're sprinting into the acceleration that's necessary to grow the U.S. manufacturing capacity.”

The solar lobby had been asking for at least an increase in the tariff rate quota. While they weren’t able to win the war over tariffs, they’re still getting something.

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Matthew Zeitlin profile image

Matthew Zeitlin

Matthew is a correspondent at Heatmap. Previously he was an economics reporter at Grid, where he covered macroeconomics and energy, and a business reporter at BuzzFeed News, where he covered finance. He has written for The New York Times, the Guardian, Barron's, and New York Magazine.

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