Biden Splits the Difference Over Solar Safeguard Tariffs

Trade Update • FEBRUARY 5, 2021

The Biden administration announced on Friday that it would extend the Section 201 safegbuard tariffs of between 14% and 15% on imported solar cells and panels for an additional four years, but with key changes that will effectively limit the scope of protection.

Specifically, the extension will exempt bifacial solar panels—double-sided panels that are typically used in larger utility installations—and will also double the capacity of solar cells that can be imported duty-free, from 2.5 gigawatts to 5.

The Trump administration had imposed the safeguards on solar imports in 2018, with duties starting at 30% and declining to 15% over a four year period, in an effort to jump-start solar manufacturing in the United States.

The presidential proclamation follows recommendations made last December by the U.S. International Trade Commission, which found that although U.S. solar manufacturers had “begun to make a positive adjustment to import competition,” continuation of the safeguard tariffs was still required to protect the domestic industry from serious harm.

The USITC also advised that while “increasing the tariff rate quota would help to continue growth in solar module production,” expanded access to bifacial panels excluded from the safeguard duties “would put downward pressure on prices for cells made in the United States.”

Industry Response

The Solar Energy Industries Association, a vocal opponent of the safeguard tariffs, said it was “disappointed with the decision,” but nonetheless commended the Biden administration for considering the range of competing interests involved and arriving at what it called “a balanced solution.”

The American Clean Power Association, a renewable energy group representing both installers and manufacturers, welcomed the administration’s decision, calling it “a win for jobs and a win for the President’s climate agenda.”

Not all manufacturers were as enthused, however. As reported here, the chief executive of Auxin Solar, a domestic solar producer that had petitioned for an extension of the tariffs, said the bifacial exclusion and increased cell import allowance reduce “the value of the safeguard to not much more than the paper it is written on.”

Another manufacturing CEO told CNBC that: “Quite simply, the extension to the Section 201 safeguard excluding bifacial panels is no safeguard at all.”