US-China Solar Trade: Billions at Stake

• US Commerce Department's 17-month probe is set to rule on trade practices related to Chinese-made solar equipment. Sanctions could include antidumping and countervailing duties up to 254% next June, impacting US clean energy growth and job opportunities. Ruling may also affect domestic manufacturers and treatment of silicon wafers used for solar cells and modules.

This week, the US Commerce Department is set to make a final determination in a 17-month probe of trade practices related to Chinese manufacturers of solar equipment. Under the initial ruling, exporters in Cambodia, Malaysia, Thailand and Vietnam are circumventing decade-old tariffs by assembling solar equipment in other Asian countries before shipping it to the US. Sanctions could include antidumping and countervailing duties as high as 254% beginning next June. US clean energy growth and new job and investment opportunities could be negatively impacted, but domestic manufacturers such as First Solar Inc. and Qcells North America have the potential to benefit. The Commerce Department is considering whether to tighten requirements for importing solar modules and cells under the moratorium on new duties, and is also looking into the treatment of silicon wafers used to make cells and modules. Any changes could provide a ‘backdoor’ for duty-free imports, undermining the Inflation Reduction Act.

Will US Solar Trade Probe Affect Clean Energy?

• The possibility of sanctions has created uncertainty within the clean energy sector in the US and could hamper investment and job creation.
• The impact of the US Solar Trade Probe could be far-reaching, with almost a quarter of US solar imports coming from the three countries involved in the probe.
• Depending on the outcome, US domestic manufacturers could benefit from increased demand for their products, although there is no guarantee that the increased cost of foreign imports won’t be passed on to the US consumer.
• The US Solar Trade Probe could have wider implications for the global clean energy sector, as similar cases have been brought up in the European Union and India.
• The potential for a ‘backdoor’ for duty-free imports could undermine the Inflation Reduction Act, resulting in increased prices for US consumers.