President Joe Biden has talked a lot about “Made in America” — and creating 10 million clean energy jobs. However, he just made a big mistake for America’s solar manufacturing industry, with serious consequences for the country’s energy future, including greater reliance on Chinese solar panels.
China accounts for around 70% of global solar panel production. Much of that comes from the massive subsidies Beijing gives to its state-owned manufacturers. China is also “unloading” solar panels on the world market below the cost of production, all to bankrupt US solar companies.
Beijing’s tactic worked. Between 2010 and 2016, the American solar industry nearly disappeared under a flood of Chinese solar cells. It wasn’t until the Trump administration imposed tariffs on Chinese solar products in 2018 that the U.S. solar industry began to regain its footing.
Since then, US solar companies have invested in new production and new workers. Last year, US-made solar cells accounted for 18% of new installations in the US, an all-time high.
Despite this, US solar companies are still struggling. In response, the Commerce Department recently launched an investigation into Chinese solar companies operating in Malaysia, Thailand, Vietnam and Cambodia to illegally avoid U.S. tariffs.
Clearly, China intends to dominate global solar production. But inexplicably, President Biden has just issued a “Solar Emergency Declaration” that gives China a free pass to continue its illegal business activities for two years. As NBC News reported, “no one will be punished” – no matter what Commerce finds.
It appears President Biden listened to the Solar Energy Industries Association (SEIA), a trade group that claims tariffs are hampering US solar installations.
That’s nonsense, however, since the United States installed 23.6 gigawatts of solar power last year, nearly half of all new generating capacity.
Significantly, SEIA represents Chinese solar producers, including companies that use forced labor in Xinjiang, western China.
In fact, American Prospect reports that some of SEIA’s core members are the “same Chinese companies that are implicated not only in investigating illegal tariff evasion, but in the use of slave labor.” to produce solar components”.
President Biden also authorized the Defense Production Act to accelerate domestic solar production.
However, until Congress explicitly appropriates additional funding, the Biden administration cannot use the DPA for solar projects.
What President Biden has done is signal that China can ship more solar panels to the United States by any means necessary. And he sabotaged the Commerce Department’s investigation into Chinese solar makers illegally circumventing US tariffs. Regardless of what the Commerce Department determines, no Chinese company can be sanctioned since the President’s statement gives them a free pass for the next 24 months.
The COVID pandemic has already demonstrated the pitfalls of America’s overreliance on Chinese imports. Allowing China to overtake the US solar industry jeopardizes US energy security.
President Biden should quickly rescind his statement – and hold Chinese companies accountable for deliberately undermining US solar makers.
Michael Stumo is CEO of the Coalition for a Prosperous America.