US officials are scrambling to resuscitate the solar power industry in the wake of a trade investigation that has choked off the supply of solar panels into the country.
For the last couple of months, the US department of commerce has been investigating allegations of tariff-dodging by Chinese solar panel manufacturers. Some of them, the department believes, may have relocated their operations to Cambodia, Malaysia, Thailand, and Vietnam as a way to skirt US import fees. The investigation is ultimately meant to protect US solar manufacturers from unfair competition, but has backfired: Spooked by the possibility of up to $3.6 billion in retroactive tariffs, many solar manufacturers in the four southeast Asian countries have cut off exports to the US, leaving more than half of planned US projects at risk of cancellation.
On June 6, the Biden administration will roll out a solution, according to Reuters: A two-year reprieve for tariffs on solar panels coming from the four countries. The policy will protect any panels delivered during that window, which officials hope will jumpstart deliveries and forestall the cancellation of solar construction projects. At the same time, president Biden will tap the Defense Production Act to produce more panels within the US. But domestic production lags so far behind imports, according to intelligence firm Rystad Energy, that it would take years to catch up even in a best-case scenario. Getting imports started again, then, is the only way to keep US solar installations from burning out.