Canadian Solar Exports Could Be Subject Again to Tariffs if Exports Surge

The solar safeguard agreement that Canada and the U.S. agreed to will only exempt Canadian-originating cells or panels, and it may start collecting safeguard deposits again if there is a surge in imports of panels or cells that the International Trade Commission agrees is undermining the effectiveness of the solar safeguard measure.

If Canadian entries are unliquidated, deposits paid between Feb. 1, 2022, and July 22 will be refunded. By July 22, Chapter 99 will be amended so that deposits will no longer be due.

The Office of the U.S. Trade Representative can ask for a return to solar safeguards if the exports climb above 1 GW in the year that began Feb. 1 and ends Jan. 31, 2023; that threshold will climb to 1.15 GW the following year, 1.30 GW the next year, and 1.45 GW between Feb. 1, 2025, and Feb. 6, 2026.

For context, 23.6 GW of panels and 2.6 GW of cells were imported to the U.S. last year, and 77% of that was imported from Southeast Asia. The U.S. produced 4.8 GW of panels in 2021. The first 5 GW of cells are not subject to the safeguard tariffs.

Bifacial panels, which are not subject to the safeguard, will not count against this threshold. If USTR asks for safeguard tariffs to return on Canadian exports, it will have to engage in consultations for 30 days before going to the ITC for a recommendation. Canada and the U.S. didn't say how large the Canadian solar panel manufacturing industry is now.