Congress is trying to put tariffs back on Asian solar panels

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The House voted Friday to reinstate tariffs on solar panel imports from several Southeast Asian countries after President Joe Biden paused them in a bid to boost solar installations in the U.S., a key part of his climate agenda.

The 221-202 vote sends the measure to the Senate, where lawmakers from both parties have expressed similar concerns about what many call unfair competition from China. Biden has vowed to veto the measure if it reaches his desk.

The House vote would overturn Biden’s action last year pausing threatened tariffs that had led to delays or cancellations of hundreds of solar projects across the United States.

Twelve Democrats joined 209 Republicans to support the override measure. Eight Republicans and 194 Democrats opposed it.

Some U.S. manufacturers contend that China has essentially moved operations to four Southeast Asian countries — Thailand, Vietnam, Malaysia and Cambodia — to skirt strict anti-dumping rules that limit imports from China.

Commerce Department inquiry last year found likely trade violations involving Chinese products. Biden halted the tariffs for two years before the Commerce investigation was completed. The White House said Biden’s action was “necessary to satisfy the demand for reliable and clean energy” while providing “certainty for jobs and investments in the solar supply chain and the solar installation market.”

Before Biden acted, the threat of tariffs from the Commerce Department inquiry had led to delays or cancellations of hundreds of solar projects in the U.S. as investors moved to protect themselves against potential penalties as high as $1 billion that could be imposed retroactively.

The U.S. industry argues that imports of solar panels are needed as solar installations ramp up to meet increased demand for renewable energy. Solar power is a key part of Biden’s goal to achieve 100% clean electricity by 2035.

Rep. Jason Smith, R-Missouri, said Friday that restoring the tariffs would hold China accountable while protecting U.S. jobs and workers. Tariffs would protect American manufacturers who are facing unfair competition from China, which is subsidizing its panels and selling them at low prices, Smith said.

“These trade abuses are well-known to all of us in this chamber,” said Smith, chairman of the tax-writing House Ways and Means Committee.

“By shipping its products through Cambodia, Malaysia, Taiwan and Vietnam, (Chinese officials) have set up a scheme that cheats American workers and consumers,” Smith said. “We know there’s wrongdoing going on. We know China is cheating, and that’s precisely why members of both parties were stunned and disappointed when the White House made the misguided decision” to halt the tariffs for two years.

Rep. Earl Blumenauer, D-Ore., said the House action would “punish U.S. workers” and the solar industry “and set us back on our climate goals.”

Rep. Judy Chu, D-Calif., said the two-year pause was “not a perfect solution,” but offered “a short-term bridge” as the U.S. solar industry moves to produce more solar panels at home.

The White House said Biden’s action boosted an industry crucial to his climate change-fighting goals while not interfering with or shutting down the Commerce investigation. Biden does not intend to extend the tariff suspension when it expires in June 2024, the White House said.

Gregory Wetstone, president and CEO of the American Council on Renewable Energy, said that if enacted, the House proposal — and its retroactive tariffs — “would have a devastating impact on U.S. solar deployment.”

Many new solar projects have already been delayed due to a global shortage of photovoltaic panels, Wetstone said. The House measure puts tens of thousands of good-paying jobs at risk and could seriously undermine the success of the landmark climate law enacted last year “even as scientists’ warnings about the impacts of global climate change are increasingly dire,” he said.

The renewable group and others in the industry say they are working to increase U.S. manufacturing of solar modules, cells and other components, but said the industry needs time to scale up.

Jason Grumet, CEO of the American Clean Power Association, said imposition of retroactive tariffs would result in thousands of American solar projects being delayed or canceled, “leading to bankruptcies, job loss and increased energy costs.”

The Coalition for a Prosperous America, a lobbying group that represents domestic manufacturers, along with farmers, ranchers and labor organizations, applauded the House vote.

“The facts are clear: Commerce confirmed that China is illegally violating U.S. trade law, and the Biden administration’s misguided rule protects them,” said Michael Stumo, the group’s CEO.

“Congress should never sit idly by and fail to respond to attacks on American industries and workers by any administration — regardless of party,” Stumo said. The tariff suspension is “a permanent giveaway to China,” he said, “not a ‘temporary bridge.’ ”



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