Navigating the New Solar Trade Landscape


June 20, 2024

The Biden administration continues to navigate the intricate course between fostering domestic solar manufacturing and countering perceived unfair trade practices by China. In a series of strategic maneuvers, the administration recently announced significant changes to the tariff structure under Sections 201 and 301 of the Trade Act of 1974, with the aim of bolstering the US solar manufacturing sector and safeguarding American jobs and businesses.

Concurrently, the expiration in June 2024 of the 24-month presidential moratorium on new tariffs for the importation of solar panels into the United States as well as a new antidumping and countervailing duty (AD/CVD) case initiated against solar panels from four Southeast Asian countries (accounting for a predominant portion of the exports of solar panels to the United States) may create further instability in solar panel import pricing. 

Doubling Down on Solar Tariffs

In response to the Office of the US Trade Representative’s recommendation to “enhanc[e] the effectiveness of the tariff actions by adding or increasing section 301 tariffs on certain products in strategic sectors,” US President Joseph Biden issued a memorandum on May 14, 2024 directing the US Trade Representative to increase tariffs in 2024, 2025, and 2026 on $18 billion worth of imports from China, with a focus on solar cells and modules. The tariffs on these critical components will double from 25% to 50%, a move designed to protect domestic manufacturers from what the administration deems as unfair trade practices by Chinese companies.

The Trade Representative proposes that increases in 2024 be effective as of August 1, 2024, with the 2025 and 2026 increases becoming effective on January 1 of the corresponding year. The Trade Representative also proposes to modify the actions by granting 19 temporary exclusions for certain solar manufacturing equipment. The products subject to these proposed modifications and products being proposed for the exclusion process are set out in annexes to the Trade Representative’s notice.

The Trade Representative also proposed raising import tariffs on battery cells from China used in electric vehicles (EVs) and energy storage systems. Tariffs for EV battery cells will increase to 25% in 2024, with energy storage tariffs following suit in 2026, with the goal of leveling the playing field for US manufacturers that have long been undercut by cheaper imports.

A notable pivot in policy is the imminent removal of the bifacial module exclusion under Section 201. Bifacial solar panels, which are predominantly used in utility-scale projects, have enjoyed an exclusion from safeguard tariffs. This exclusion, implemented during the previous administration, has led to a surge in imports, undermining the efficacy of the Section 201 safeguard measures. The Biden administration’s decision to eliminate this exclusion seeks to restore the protective intent of the original tariffs, granting US manufacturers a stronger shield against unfair competition.

In addition, the administration has announced the end of the temporary “solar bridge,” which facilitated duty-free imports from Cambodia, Malaysia, Thailand, and Vietnam. This measure, initially intended to support the ramp-up of domestic solar manufacturing, concluded on June 6, 2024, and producers in Southeast Asia that have been found to be circumventing AD/CVD on solar manufacturers from China will be subject to duties unless they have modified their manufacturing process to conform to the new certification requirements.

Concurrently, the administration has announced it will crack down on stockpiling practices by enforcing a 180-day installation requirement for duty-free imported panels. US Customs and Border Protection (CBP) will rigorously monitor compliance, necessitating detailed certifications from importers. Earlier in 2024, CBP began issuing questionnaires to solar companies requesting extensive disclosures about the source of modules, panels, and other products.

One day after the Biden administration announced the increased tariffs, and in response to a petition filed by the American Alliance for Solar Manufacturing Trade Committee, the US Department of Commerce (Commerce) announced on May 15, 2024 the start of AD/CVD investigations into crystalline silicon photovoltaic cells—whether or not assembled into modules—originating from Cambodia, Malaysia, Thailand, and Vietnam. And, on June 7, 2024 the US International Trade Commission found that there is a reasonable indication that US solar industry is “materially injured” or “threatened with material injury” by such imports.

The below table sets out the anticipated schedule of deadlines: 




Petition(s) Filed

April 24, 2024

April 24, 2024

Commerce Initiation Date

May 14, 2024

May 14, 2024

ITC Preliminary Determinations

June 7, 2024

June 7, 2024

Commerce Preliminary Determinations

October 1, 2024

July 18, 2024

Commerce Final Determinations

December 16, 2024

October 1, 2024

ITC Final Determinations

January 30, 2025

November 15, 2024

Issuance of Orders

February 6, 2025

November 22, 2024


These deadlines may be extended under the statute.

The Department of Energy (DOE) and Commerce will also intensify monitoring of solar module import patterns, particularly from Southeast Asia, where Chinese manufacturers have been found circumventing AD/CVD. This vigilance aims to prevent market oversaturation and ensure a fair competitive environment for US producers.

Supporting US Manufacturing

To further incentivize domestic production, the US Department of Treasury has issued new guidance on the domestic content bonus under the Inflation Reduction Act of 2022. This bonus rewards developers that source materials such as iron, steel, and manufactured products domestically. The updated guidance includes an elective safe harbor, allowing developers to rely on DOE-provided default cost percentages to determine eligibility, thereby simplifying compliance and fostering greater domestic partnerships.

Moreover, the DOE is investing more than $70 million in R&D to support new technologies in the solar supply chain. This funding, part of the president’s Bipartisan Infrastructure Law, will address key gaps and promote innovations in solar wafer and cell manufacturing, opening new markets for advanced solar technologies.

To support continued growth in US solar manufacturing, the administration will manage the current 5-gigawatt tariff-rate quota for imported solar cells under Section 201. Should imports approach this quota, it will be raised by an additional 7.5 gigawatts to ensure a steady supply for domestic module manufacturing.

Guidance for Renewable Energy Developers

Given these sweeping changes, renewable energy developers and stakeholders must navigate this new regulatory environment with careful attention.

Here are five key takeaways to ensure compliance and strategic alignment:

  • Review Existing Procurement Contracts: Developers that are reliant on imports of solar panels must reassess their supply chains in light of the above developments. They should immediately review their existing procurement agreements to understand how the risk of tariff increases is allocated between the parties. Clauses related to price adjustments, force majeure, and tariff risk should be carefully examined and, if necessary, renegotiated to ensure clarity and fair allocation of risks.
  • Reevaluate Supply Chain Strategies: Given the upcoming end of the solar bridge and removal of the bifacial module exclusion, developers must reassess their supplier networks. It is crucial to identify and potentially diversify suppliers to mitigate risks associated with increased tariffs and ensure compliance with new regulations.
  • Utilize Domestic Content Bonus: Developers should familiarize themselves with the new elective safe harbor guidelines to maximize eligibility for the domestic content bonus. Projects meeting the domestic content requirements can benefit from additional tax incentives, making it financially advantageous to source components domestically.
  • Plan for Compliance and Documentation: With increased scrutiny on stockpiling and import certification, developers must ensure robust compliance mechanisms are in place. Maintain detailed records and certifications for duty-free imports to comply with CBP requirements and avoid penalties; accurate documentation and timely certification of solar module utilization within the 180-day period will be critical to avoid penalties and ensure smooth project execution. For projects relying on imports from the four Southeast Asian countries, ensure all panels are not subject to the increased tariffs under the anticircumvention case through appropriate CBP certifications and monitor the developments in the new AD/CVD case involving solar panels from these countries.
  • Stay Informed on Policy Updates: Regularly consult guidance from the Departments of Treasury, Energy, and Commerce to stay abreast of new incentives, quota adjustments, and compliance requirements. Be prepared to make proactive adjustments to procurement strategies based on new developments and enforcement actions.

The recent regulatory changes present both challenges and opportunities for solar developers. By proactively assessing the impact of increased tariffs, diversifying supplier networks, and leveraging domestic content bonuses, developers can navigate these changes effectively.

Immediate action to review procurement agreements and secure necessary supplies will be crucial to mitigate risks and capitalize on the incentives available under the Inflation Reduction Act. As the clean energy landscape continues to evolve, staying informed and adaptable will be key to maintaining a competitive edge in the burgeoning US solar market.

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