By Nichola Groom and Jarrett Renshaw
(Reuters) -The Biden The government is expected to grant a request from South Korea’s Hanwha Qcells to reverse a two-year-old trade exemption that allowed imports of a dominant solar panel technology from China and other countries to avoid tariffs, two sources familiar with the matter said. the plans of the White House. on Wednesday.
The news sent shares of solar energy makers, including US-based First Solar, higher in afternoon trading.
Qcells’ request, which has not previously been reported, comes as the company seeks to protect a committed $2.5 billion expansion of its U.S. solar presence from competition from cheaper products from Asian made.
The solar division of Korean conglomerate Hanwha Corp detailed the request in a formal petition to the U.S. Trade Representative on February 23. It included letters of support from seven other companies that had collectively invested billions of dollars in U.S. solar factories.
No decision has yet been made on the timeline of the expected turnaround, the sources said.
Tariffs on the import of bifacial panels, the key technology in large-scale solar projects, would be a boon to the more than 40 solar factories planned since US President Joe Biden passed his landmark climate change bill, the Inflation Reduction Act, in 2022. signed.
These factories are critical to Biden’s plan to fight climate change, revive American manufacturing and create millions of union jobs.
Past trade actions have sharply divided the U.S. solar industry, which is dominated by installers and developers who rely on cheap imports to keep their project costs low.
The largest U.S. solar trade group, the Solar Energy Industries Association (SEIA), lobbied for the bipartisan exemption.
In a statement, SEIA did not directly address the exemption, but called for an increase in the number of solar cells that can be imported tariff-free to help companies assemble American-made panels.
“We hope the government is willing to directly support increased domestic solar panel production by increasing cell tariff quotas,” said Stacy Ettinger, SEIA’s senior vice president of supply chain and trade.
Biden administration officials, including Treasury Secretary Janet Yellen and U.S. Trade Representative Katherine Tai, have said in recent weeks that the U.S. is evaluating trade measures to counter threats posed by China’s massive investments in factory capacity for clean energy goods.
The solar panel issue goes to the heart of one of Biden’s arguments for re-election: that his economic policies have begun to transform the U.S. energy economy while combating climate change. However, the growth rate in the domestic solar panel manufacturing market is being questioned by rising imports of cheap Chinese panels.
A bipartisan group of U.S. senators, led by the two Democrats from the critical election battleground state of Georgia, asked Biden earlier this year to raise tariffs on Chinese solar panels or face an oversaturated market just as clean tax credits energy come onto the market.
Qcells, which has two factories in Georgia, is the largest U.S. producer of silicon-based solar products.
In its petition, a copy of which has been seen by Reuters, the company asked Biden to revoke an exemption of so-called bifacial panels from duties first imposed by Republican former President Donald Trump in 2018 and imposed by Biden in 2022 , a Democrat, was renewed.
Tariffs on imported modules started at 30% and currently stand at 14.25%. They expire in 2026.
‘A LEVEL PLAYING FIELD’
Most imported panels come from Southeast Asia, but are made there by Chinese companies.
The US imposed tariffs on some panel manufacturers for finishing their products in Cambodia, Malaysia, Thailand and Vietnam to avoid tariffs on goods made in China. Biden waived these tariffs nearly two years ago, a policy the White House said will expire in June.
“We continue to review all of our options to ensure that the historic investments spurred by the Inflation Reduction Act are successful,” a White House official said. “Our companies and workers can compete with anyone, but they need a level playing field.”
Bifacial panels can generate electricity on both sides. The technology was in its infancy when the tariffs were first imposed, but now accounts for 98% of imported modules, according to the petition.
The action is necessary, Qcells said in the petition, to preserve the many plans for new U.S. solar energy production capacity unleashed by the IRA’s incentives.
“Despite these positive trends, there is increasing evidence that negative market conditions caused by rising imports of bifacial modules are causing several companies to reconsider their plans to invest in the US,” the petition said.
Qcells’ request is supported by seven other solar manufacturers with U.S. factories — First Solar, Heliene, Suniva, Silfab, Crossroads Solar, Mission Solar and Auxin Solar — according to the petition documents.
Shares of First Solar closed nearly 3% higher at $178.01 on the Nasdaq.
(Reporting by Nichola Groom and Jarrett Renshaw; Editing by Timothy Gardner and Bill Berkrot)
