WASHINGTON — Tariffs aimed at protecting America’s solar industry from foreign competition snapped back into place Thursday, ending a two-year pause President Joe Biden approved as part of his effort to jump-start solar adoption.
The tariffs, which will apply to certain solar products made by Chinese companies in Asia, kicked in at a moment of growing global concern about a surge of cheap Chinese solar products that are undercutting American and European manufacturers.
The Biden administration has been trying to build up America’s solar industry by offering tax credits, and companies have announced more than 30 new American manufacturing investments in the past year. But American solar companies say they are still struggling to survive as competitors in China and Southeast Asia flood the global market with solar panels that are being sold at prices far below what American firms need to charge to stay in business.
That has forced Biden to face an uncomfortable choice: Continue welcoming inexpensive imports that are helping the U.S. transition away from fossil fuels or block them to protect American solar factories that are benefiting from taxpayer money.
The tariffs taking effect Thursday encapsulated that problem. The levies, which apply to certain solar products coming to the United States from Cambodia, Thailand, Malaysia and Vietnam, were approved two years ago, after U.S. officials ruled that some Chinese firms were trying to dodge preexisting U.S. tariffs on China by routing solar panels through other countries. The exact tariff rate depends on the company but could be more than 250%.
The Chinese firms had set up factories in Southeast Asia, but Commerce Department officials said some were not doing substantial manufacturing there. Rather, they were using sites in those countries to make minor changes to Chinese-made solar products and then shipping them to the United States tariff-free, the ruling decided.
Those products should have been subject to additional tariffs, but the Biden administration made an unusual decision in June 2022 to temporarily pause them for two years, to ensure that the United States would still have access to plenty of solar panels. Congress passed a resolution last year to reinstate the tariffs, but Biden vetoed it.
In the two years since the Biden administration made the decision to pause the tariffs, solar prices have cratered, and solar panel imports have surged.
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