SEIA reports ‘rapid degeneration’ of solar sector following federal anti-dumping investigation

Diving Brief:

  • Solar Energy Industries Association Calls on the Commerce Department to Immediately Issue a Negative Preliminary Determination in the Anti-Dumping and Countervailing Investigation of Solar Photovoltaic Imports from Cambodia, Malaysia, Thailand and Vietnam .
  • The investigation, sparked by a petition in February from California-based manufacturer Auxin Solar, could take up to a year for a final decision, leaving developers scrambling to change their panel sourcing as shipments are delayed or canceled due to uncertainty surrounding the investigation. which could result in retroactive import duties.
  • “It happened eight days ago and we are already seeing the effects of this decision to open an investigation,” he added. SEIA President and CEO Abigail Ross Hopper said Tuesday during an online event. “We are already seeing a rapid degeneration of the US solar industry as panel suppliers stop shipping to the US.”

Overview of the dive:

U.S. solar developers are looking around the world for alternatives to the four countries under Commerce Department‘s investigation to supply their solar project pipelines, with major developers leaning on their resources and connections to solve problems .

“While some of NextEra Energy’s solar and storage projects may be affected by the disruption this decision is expected to cause, we will work closely with our suppliers and customers to assess the potential impacts of this investigation and remain confident in our ability to arrive at acceptable mitigation measures,” NextEra said in a statement Tuesday.

Auxin petition accuses Chinese-made components and panels of circumventing tariffs via Southeast Asian countries, and Akin Gump Strauss Hauer & Feld partner Matt Nicely, representing SEIA, predicts difficulty following and to establish that other countries and suppliers are not similarly using such parts to also circumvent the tariffs that have been imposed on Chinese solar manufacturers.

“I don’t think any particular developer is spared”, Dan Siegel, CEO of large-scale solar company Birch Creek Development, told Utility Dive. “WWe’re lucky in the sense that…we don’t have anything on a boat right now,” he added, but it will impact the timing of the 2023 build plans.

SEIA and other solar industry players have spoken out in opposition to the investigation, arguing that it would not provide the incentives needed to expand solar manufacturing in the United States, where there is not enough supply. for growing solar demand.

“It’s not a policy that creates an incentive to manufacture in the United States. It creates an incentive to manufacture at the lowest cost elsewhere,” Siegel, a former head of renewable energy business development at US Bank, said of of the Commerce Department’s investigation.

The U.S. solar industry has faced uncertainty in recent years with the Section 201 tariffs initially imposed by the Trump administration on Chinese-made photovoltaic panels and crystalline silicon modules. SEIA had advocated for the tariffs to be drastically reduced or even revoked. The Biden administration extended tariffs for four years in February, except for the more efficient bifacial panels. While solar advocates were disappointed with the tariff extension, some analysts said the tariffs had no impact on the solar sector’s years of record growth in recent years.

“We have not noted any impact of tariffs on investments over the past five years,” Raj Prabhu, CEO of clean energy research firm Mercom Capital Group, said in an email.

That changed with the Commerce Department’s investigation of exports from Cambodia, Malaysia, Thailand and Vietnam, as shipments soon began to be held up by suppliers. The anti-dumping and countervailing investigation had an immediate impact on imports, and duties may also be applied retroactively if the Department makes an affirmative determination.

SEIA said 74% of more than 200 respondents to a Commerce survey impact survey said PV module shipments had been delayed or canceled.

SEIA received over 200 responses within two days of launching the survey. The first snapshot includes many market segments, and more than 90% of companies surveyed reported negative impacts on their bottom line.

Only 10 residential developers had responded to the survey at the time of Utility Dive’s survey, but that could be because “residential space is single-layer insulated” and many buy through US distributors instead. to import solar panels, Justin Baca, SEIA VP of Markets and Research, said during the webinar.

Iulia Gheorghiu/Utility Dive, data courtesy of SEIA

“The threat of these duties being imposed retroactively…is why many companies are deciding to stop shipping,” said Matt Nicely, partner at Akin Gump Strauss Hauer & Feld, the firm representing SEIA, during the webinar. Tuesday.

“The uncertainty around the deal is already a cause for negative sentiment in the market. A positive move could lead to a drop in investment and a drop in demand,” Prabhu said.

“The trade has changed its mind between a preliminary decision and a final decision in the past,” said Julia Eppard, attorney for Akin Gump, during the webinar. According to her, there is no instance where the agency issued a negative preliminary decision and a positive decision in the final.

SEIA plans to update its industry impact survey on Thursday.