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Commerce ruling will impact solar industry for years to come, SEIA warns

The preliminary finding comes as part of a Commerce Department inquiry into alleged unfair trade practices that has upended the solar industry for most of the year.

The Commerce Department just handed the U.S. solar industry a lump of coal as a holiday gift.

In a preliminary finding issued December 1, the Enforcement and Compliance arm of the International Trade Administration found that imports of certain crystalline silicon photovoltaic cells, whether or not assembled into modules (solar cells and modules), that were exported from Cambodia, Malaysia, Thailand, or Vietnam using parts and components produced in China are circumventing the antidumping duty (AD) and countervailing duty (CVD) orders on solar cells and modules from China.

Calling the preliminary finding a “mistake we will have to deal with for the next several years,” Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association (SEIA), said the trade group was “obviously disappointed that Commerce elected to exceed its legal authority.” She said that solar cell and module manufacturing greatly exceed the anticircumvention statute’s “minor or insignificant processing” limitation.

“The only good news here is that Commerce didn’t target all imports from the subject countries,” she said in a statement. She predicted that the decision would strand billions of dollars’ worth of American clean energy investments and result in a “significant loss” of clean energy jobs.

In June, President Joe Biden granted some relief by pausing any new tariffs on modules imported from Southeast Asia for two years. The reprieve came after a $5 million pressure campaign that urged the president to step in.

Ross Hopper said that while President Biden “was wise” earlier this year to provide a two-year window before any tariff implementation, “that window is quickly closing.” She said that two years is “simply not enough time to establish manufacturing supply chains” to meet U.S. solar demand.

In prepared remarks delivered November 30, Commerce Secretary Gina Raymond said that as China’s economy has grown in size and influence, so too has its “commitment to using non-market trade and investment practices in ways that are forcing us to defend our businesses and workers.”

‘Massive’ support

She said “While we watched China become a world leader in manufacturing and reap the massive benefits of manufacturing-driven innovation, the U.S. economy became less competitive and overly dependent on China for an increasing number of critical technologies and goods.” She noted that China achieved its success through “massive state support of its industries.” 

In December 2012, Commerce published in the Federal Register AD and CVD orders on U.S. imports of solar cells and modules from China. This past February, domestic solar module producer Auxin Solar alleged that solar cells and modules completed in Cambodia, Malaysia, Thailand, or Vietnam using parts and components manufactured in China were circumventing the orders and should be covered by their scope. On April 1, Commerce initiated the requested circumvention inquiries.

In an exclusive interview with Renewable Energy World‘s podcast Factor This!, Auxin Solar CEO Mamun Rashid said “We want to make sure investing in American manufacturing is a safe bet. Once we saw the data (regarding solar modules produced in Southeast Asia), it looked very suspicious.”

Auxin was formed in 2008 and produces solar modules for other companies as a contractor. Its products include highly-customizable solar modules and some of the first bifacial solar modules in the U.S.

Commerce said its circumvention inquiries covered crystalline silicon photovoltaic cells whether or not they were partially or fully assembled into other products that were produced in the four Southeast Asian countries from wafers produced in China.

The scope also included modules, laminates, and panels consisting of crystalline silicon photovoltaic cells and where more than two of the following components in the module/laminate/panel were produced in China: silver paste; aluminum frames; glass; backsheets; ethylene vinyl acetate sheets; and junction boxes.

In mid-November, SEIA sent a letter to Raimondo on behalf of more than 240 solar and storage companies urging her to issue a negative determination.

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