WASHINGTON — The Coalition for a Prosperous America (CPA) today applauded a range of new actions by the Biden administration to strengthen the U.S. solar manufacturing industry and counter China’s illegal, predatory trade activity designed to undermine American producers and workers. These important actions include removing the bifacial exclusion under the Section 201 solar safeguard tariffs, a move that CPA has long-called for, and a commitment that the Biden administration’s harmful solar tariff moratorium will not be extended. Additionally, today’s announcement includes additional guidance on the domestic content bonus rule. CPA has previously called on the Biden administration to issue rules on the domestic content bonus that will incentivize the full reshoring of the domestic solar supply chain.
“Today’s announcement is a welcome signal step by the Biden administration that it recognizes the importance of supporting America’s solar manufacturing industry and that a whole-of-government approach is needed to counter China’s actions to dominate the global solar supply chain,” said Michael Stumo, CEO of CPA. “After protecting China’s illegal trade activity, we appreciate the Biden administration’s commitment to end the harmful tariff moratorium, and for issuing additional guidance on the domestic content bonus rule that recognizes the IRA’s original intent of reshoring the full domestic solar manufacturing supply chain.”
These actions come just one day after the Biden administration formally initiated a review of petitions filed by seven major U.S. solar manufacturers to investigate potentially illegal trade practices by Cambodia, Malaysia, Thailand, and Vietnam that are injuring the U.S. solar industry. The solar trade case comes on the heels of U.S. Treasury Secretary Janet Yellen’s recent remarks that “China’s overcapacity distorts global prices and production patterns and hurts American firms and workers.” Chinese-owned companies’ global market share in solar products is more than 80 percent. The current environment, if left unaddressed, threatens America’s ambitions of building a domestic solar manufacturing supply chain and mitigating the risk of an overreliance on Chinese solar.
The Biden administration took the following actions:
- Removal of the bifacial module exclusion under Section 201. This is a stark reversal of the Biden administration’s previous action to exclude bifacial solar panels in its extension of the Section 201 solar safeguard tariffs — a move that Bank of America bluntly called out as rendering the tariffs “largely toothless” and was an outright rejection of the U.S. International Trade Commission’s (ITC) unanimous and bipartisan recommendation that the 201 tariffs should be extended and include bifacial solar products.
- Ending the Solar Emergency Declaration that allowed China to illegally circumvent AD/CVD orders for 24 months, and cracking down on stockpiling. CPA strongly opposed the Biden administration’s tariff moratorium and led a bipartisan, bicameral effort to repeal the rule, which was vetoed by President Biden last year. As a result of the tariff moratorium, China has overproduced and dumped product into the U.S. market, threatening the U.S. solar industry. The Department of Commerce requires that panels imported duty-free during the moratorium must be installed within 180 days to prevent stockpiling. Customs and Border Protection (CBP) has announced that it will vigorously enforce this provision, including by requiring importers to provide to CBP a certification of solar module utilization with detailed information about the modules being deployed.
- Monitoring import surges and oversupply. A recent analysis by the CPA Economics Team warned that the U.S. solar industry is being threatened by China’s overcapacity and that China’s solar companies are surviving on CCP subsidies.
- Providing additional guidance on the domestic content bonus. The Inflation Reduction Act (IRA) provides a tax credit to solar project developers, including a 10% domestic content bonus if solar project developers use a minimum level of U.S.-manufactured solar equipment in their projects. CPA has called on the Biden administration to issue rules on the domestic content bonus that will incentivize the full reshoring of the domestic solar supply chain.
- Supporting technology development to onshore solar wafer and cell manufacturing. CPA has consistently called for the Biden administration to take action to incentivize the full reshoring of the domestic solar manufacturing supply chain, including modules, photovoltaic cells, and solar-grade polysilicon.
- Managing the tariff-rate quota for solar cells under Section 201 to support expanded solar manufacturing. Currently, there is a 5-gigawatt tariff-rate quota for imported solar cells under Section 201. The Administration will closely monitor the level of imported solar cells used to manufacture panels in the U.S. and will work to raise the quota by 7.5-gigawatts if imports approach the current quota level, to ensure domestic module manufacturing continues to grow while manufacturers scale production throughout the supply chain.
Read the full range of actions by the Biden administration here.
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