US unveils first of two decisions regarding solar tariffs

The U.S. Trade officials may this week impose new tariffs against solar panels imported from four Southeast Asian countries. American manufacturers claim that these nations provide unfair subsidies, which make U.S. goods uncompetitive.

The Commerce Department is expected to announce its first preliminary decision in this year on a trade case filed by Hanwha Qcells in Korea, Arizona's First Solar, and several smaller companies that are seeking to protect their billions in investments made in U.S. manufacturing of solar panels.

Domestic producers claim that the competition from Chinese companies in Malaysia, Vietnam Thailand and Cambodia, which import cheap products, threatens President Biden's plan to increase domestic manufacturing of clean technology needed to combat climate changes.

In an interview conducted last month, Tim Brightbill said that the group hoped the cases would help level the playing fields.

Commerce will consider for the first-time the impact of cross border subsidies. For example, the Chinese government subsidizing a Vietnamese manufacturer or another country. The department had banned such countervailing duty in the past, but they were allowed this year.

The Hanwha-led American Alliance for Solar Manufacturing Trade Committee claimed in its petition of April that Chinese manufacturers in four Southeast Asian nations received generous subsidies in the form cheap financing, land and electricity, tax exemptions, and more. The group also claimed that the companies received subsidies from China, including discounted raw materials and components, as well as support via the Belt and Road Initiative. This is a decade-old program of infrastructure to connect China with Asia and the Middle East.

In November, a preliminary ruling is expected in a companion anti-dumping matter. Anti-dumping duties are usually lower than countervailing duties.

Solar imports are subject to a variety of taxes and duties in the U.S.

Some U.S. manufacturers of solar panels do not want the Commerce Department to impose new import tariffs.

Solar cells from Southeast Asia are used by companies to build panels in the U.S. Many U.S. panels plants are owned and operated by large Chinese manufacturers.

Tariffs are also a concern for solar project developers, who fear that they will increase the price of panels in the U.S.

Jim Murphy, President of Invenergy in Chicago, said that imposing tariffs on imports of solar cells - at a time when the U.S. has no solar cell manufacturing - would only increase the profits of existing manufacturers and stifle America’s ability to onshore solar supply chains and meet the growing demand for affordable, clean and reliable electricity supply. (Reporting and editing by David Gregorio; Nichola Groom)

(source: Reuters)