President Joe Biden will extend Trump-era tariffs on imported solar equipment by four years, but in a gesture for domestic solar installers, eased the terms to exclude a panel technology increasingly used in big U.S. projects.
The decision, announced by a top administration official to the Wall Street Journal and other news outlets Friday, reflects the Biden administration’s challenge to support American union labor, but accept the often cheaper overseas-made components that could help propel the U.S. to its ambitious zero-emissions goals.
Reducing or eliminating the tariffs was heavily pushed by U.S. solar installers, while the U.S. makers of solar components said they still needed the trade boost to remain competitive with overseas, mostly Asian, competition. Other renewable-energy interests have said access to cheaper solar manufacturing is necessary to keep the energy source more attractive than traditional fossil fuels, such as oil CL00, +2.46% and natural gas NG00, -5.61%.
The four-year extension of the tariff exempts bifacial panels which can generate electricity on both sides and are favored by large-scale developers. The technology has become more readily available just in the time since the tariffs were first imposed by the previous administration.
The extension also doubles the import quota on solar cells — the main components of panels — to 5 gigawatts, and opens a pathway for duty-free supply from neighboring Canada and Mexico, the Journal reported.
Former President Trump leaned on a 1974 trade act for the tariffs, which were set to expire on Feb. 6. The tariffs started at 30% and declined to 15% in the final year.
The U.S. International Trade Commission in November, following a three-month review, said the tariffs were still necessary to prevent harm to the U.S. solar manufacturing industry.
Broader solar trade groups countered that the continuation of the tariffs would threaten Biden’s goal to dramatically expand clean energy ICLN, +1.02% and decarbonize the U.S. electricity sector by 2035 to slow global warming.
Those against extending the tariffs noted that domestic prices for solar panels are now among the highest in the world and significantly above the global average.
According to the Solar Energy Industries Association (SEIA), these solar tariffs have led to the loss of more than 62,000 American clean-energy jobs and not influenced U.S. job growth in this area.
Current domestic production of solar panels only meets 15% of the U.S. solar demand, they said. Nearly 90% of workers in the domestic solar industry work in non-manufacturing jobs — from installation and maintenance to operations, distribution and development — and rely on the availability of “affordable” solar panels, the trade group says.
Sen. Jacky Rosen, a Democrat from Nevada, who is against the tariff extension, was pleased the administration did heed the call to exclude bifacial panels and increase the number of allowable imported solar cells.
But, Rosen said, she “will continue working to strengthen solar industry jobs in Nevada and across the country by boosting American manufacturing and fighting to end these misguided solar tariffs, including through legislation.”
Biden has pledged to set the U.S. on course toward net-zero emissions by 2050 and an even more ambitious marker of halving U.S. emissions by the end of this decade. But in pushing renewable energy and electric-vehicle incentives he has also said that U.S. jobs and specifically, union jobs, must be a priority.