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US to unveil first of two decisions on more solar tariffs
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US to unveil first of two decisions on more solar tariffs
Sep 30, 2024 3:31 AM

Sept 30 (Reuters) - U.S. trade officials this week may

impose new tariffs on solar panels from four Southeast Asian

nations that American manufacturers have complained employ

unfair subsidies that make U.S. products uncompetitive.

The announcement, due on Tuesday, is the first of two

preliminary decisions the Commerce Department will make this

year in a trade case brought by Korea's Hanwha

Qcells, Arizona-based First Solar ( FSLR ) and several smaller

companies seeking to protect billions of dollars in investments

in U.S. solar manufacturing.

The domestic producers argue that competition from cheap

imports by Chinese companies operating in Malaysia, Vietnam,

Thailand and Cambodia threatens U.S. President Joe Biden's goal

to boost domestic manufacturing of clean energy technologies

needed to combat climate change.

"They are hopeful that these cases will help to level the

playing field," Tim Brightbill, the group's attorney, said in an

interview last month.

Commerce's decision will for the first time consider the

impact of cross-border subsidies, for instance the Chinese

government subsidizing a manufacturer in Vietnam or elsewhere.

Such countervailing duties had previously been banned but this

year the department finalized a rule that allowed them.

In its April petition, the Hanwha-led American Alliance

for Solar Manufacturing Trade Committee alleged that Chinese

manufacturers operating in the four Southeast Asian countries

received generous subsidies from those governments in the form

of cheap financing, electricity and land, tax exemptions and

more. The group also alleged the companies receive subsidies

from China like cut-rate raw materials and components as well as

other support via its Belt and Road Initiative, a decade-old

infrastructure program to link China with Asia, the Middle East

and Europe.

A companion anti-dumping case is expected to receive a

preliminary decision in November. Countervailing duties tend to

be lower than anti-dumping duties, a form of tariff meant to

keep overseas producers from selling at below market prices.

The U.S. already collects an array of duties on solar

imports.

Not all U.S. solar manufacturers want Commerce to impose new

tariffs on solar imports.

Companies setting up panel factories, for instance, rely on

low-cost solar cells from Southeast Asia to assemble into panels

in the U.S. Many U.S. panel plants are owned by large

China-based manufacturers.

Solar project developers also worry that tariffs will hurt

their business by driving up the cost of panels, which are

already more expensive in the U.S. than anywhere else in the

world.

"Imposing tariffs on solar cell imports - when there's

currently no solar cell manufacturing in the U.S. - will only

enhance the profits of incumbent manufacturers, and will stifle

America's ability to onshore the solar supply chain and meet the

fast-growing demand for clean, affordable and reliable power

supply" said Jim Murphy, president of Invenergy, a Chicago-based

project developer that is also the joint owner, with China's

Longi, of Ohio solar panel maker Illuminate USA.

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