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Key Takeaways | How Solar Industry Leaders are Addressing and Overcoming the US–China Trade War

The US-China trade war has caused a significant impact on the solar industry, and that impact is expected to grow. In this webinar, learn how solar industry leaders are handling the effects of the US–China trade war and how they are preparing for the future.

Our first webinar of this series featured McDermott Will & Emery partner Carl Fleming, Pine Gate Renewables Director of Regulatory Affairs Brett White, Vice President of Construction James Froelicher and Assistant General Counsel Jess Cheney.

Below are key takeaways from the webinar:

1. Withholding Release Order. The US Customs and Border Protection (CBP) issued a withholding release order (WRO) against Hoshine Silicon Industry Co. Ltd., a company located in China’s Xinjiang Uyghur Autonomous Region wherein all silica-based products made by Hoshine and its subsidiaries are to be detained at all US ports of entry. Because of this WRO, manufacturers have been moving outside of the Xinjiang Uyghur Autonomous Region in order to avoid being subject to it.

There have been numerous detentions of silica-based products at multiple ports across the United States, and it is expected that the detention of materials will continue. In order to combat this, suppliers and industry leaders are presenting documentation to show that the materials are not being produced from forced labor or Hoshine and its subsidiaries.

Although the WRO was expected to cause significant disruption, it is not having as large of an impact as feared because many suppliers had already left the Xinjiang Uyghur Autonomous Region.

2. Anti-Dumping and Countervailing Petition. Anti-Dumping and Countervailing Petitions filed in August 2021 requested that the US Department of Commerce (DOC) include additional tariffs against solar panel imports from Malaysia, Thailand and Vietnam. The petitioners requested additional tariffs ranging from 50% – 250%. The DOC has yet to decide whether to investigate based on the petition, however, the impacts of the petition are already being felt with disruptions to the supply chain. If the DOC were to investigate, the solar industry would likely see a severe slowing of projects in 2022 and 2023 as neither suppliers nor developers are willing to bear the economic risk of the potential tariffs.

3. The DOC and the Biden Administration. The DOC and the Biden administration are expected to make decisions regarding tariffs, as well as anti-dumping and countervailing duties, that will directly affect the solar materials supply chain.

The Biden administration hopes to increase the domestic supply of solar materials, however, domestic manufacturers currently only produce approximately 25% of the overall demand for solar materials. As a result, the solar industry cannot immediately divert to purchasing solar materials from domestic manufacturers as the supply simply is not available. As an incentive to increase domestic manufacturing, solar industry leaders hope tax credits can be offered to companies that manufacture solar materials.

The Biden administration is expected to decide whether the 18% tariff on imported solar panels [...]

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FERC Rejects Department of Energy Proposal Benefitting Coal and Nuclear

On January 8, 2018, the Federal Energy Regulatory Commission (FERC) rejected the Department of Energy’s (DOE) Proposed Rule, which would have required organized wholesale electricity markets run by independent system operators (ISOs) or regional transmission organizations (RTOs) to establish tariff mechanisms for purchasing energy from eligible “reliability and resilience resources” and mandated a recovery of costs plus a return on equity for such resources. Eligible reliability and resilience resources would have to be (1) located within an RTO/ISO, (2) able to provide essential reliability services, and (3) have a 90-day fuel supply on-site. Practically, these requirements would limit participation to coal and nuclear plants. (more…)




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