Senate Votes to End Solar Circumvention Duties Pause; Veto Promised

The Senate passed a resolution to end the duty waiver on solar panels from Southeast Asia that the Commerce Department says circumvent antidumping and countervailing duties, but the president has promised to veto the resolution.

The vote the evening of May 3 was 56-41, with three senators not voting, including Sen. Thom Tillis of North Carolina, a Republican who had criticized the circumvention investigation, which was brought by Auxin Solar, a small solar panel manufacturer.

Nine Democrats supported reversing the administration's decision to temporarily prevent deposit collection on imported solar panels under scrutiny for circumvention. Sen. Rand Paul, R-Ky., voted in favor of the pause on duties. The waiver on duties will last another 14 months.

On April 24, President Joe Biden wrote to the House of Representatives, before it voted on the same resolution, saying that with the incentives in the Inflation Reduction Act, domestic solar panel production is expected to be eight times larger at the end of 2024 than it was in 2020. "The Commerce rule provides a short-term bridge to ensure there is a thriving U.S. solar installation industry ready to purchase the solar products that will be made in these American factories once they are operational. Given the strong trends in the domestic solar industry, the President does not intend to extend the tariff suspension at the conclusion of the 24-month period in June 2024," his statement of administration policy said.

The House passed the resolution 221-202. Both chambers are far below a veto-proof majority. Eight Republicans voted on April 28 to keep the two-year pause on trade remedy collections for these panels; a dozen Democrats voted to reverse the administration's action.

Democratic Sen. Sherrod Brown, who represents Ohio, the state that's home to the largest domestic solar panel manufacturer, First Solar, explained in a speech on the floor of the Senate this week why he was voting for the resolution, which was introduced by Republicans.

He said: "The administration's own Commerce Department conducted an independent investigation. They released preliminary results in December. And surprise, surprise, they found that, yes, four leading Chinese solar cell manufacturers are dodging U.S. tariffs by routing some of their operations through Southeast Asia.

"We can't let them keep doing it.

"That is what this vote today is about. It has real consequences for our leadership in my State in manufacturing and for American leadership in one of the leading energy industries of the future.

"To my colleagues who say we must allow these Chinese imports for the time being in order to fight climate change, I disagree. Nobody in this body is more concerned and more active in terms of understanding environmental issues. As a senior in high school, I started the first Earth Day in Richland County in 1970. My commitment is absolute. But when people say this is about climate change, surely, it isn't. It is about ceding our leadership to other countries, and it will not result in long-term success.

"American workers must know we have their backs."

According to the Solar Energy Industry Association, the amount of solar panels installed in 2022 declined 16% from 2021, a decline the group attributed to both the impact of the anti-circumvention investigation and the detentions of solar panels from Asia suspected to contain polysilicon from Xinjiang, China.

In its preliminary determination in December, the Commerce Department found solar cells and modules from Cambodia, Malaysia, Thailand and Vietnam are circumventing the AD/CVD orders on solar cells from China (A-570-979/C-570-980), but four major companies from that region are not circumventing the duties: New East Solar in Cambodia, Hanwha Q Cells and Jinko Solar in Malaysia, and Boviet Solar Technology in Vietnam.

The Commerce Department extended the deadline to issue its final determinations in the anti-circumvention inquiries concerning solar cells from Cambodia, Malaysia, Thailand and Vietnam, until Aug. 17.