The Washington PostDemocracy Dies in Darkness
The Climate 202

Outlook for solar industry is clouded by Commerce Department probe

The Climate 202

Comment

Good morning and welcome to The Climate 202! 

🚨 Below, we have a little scoop about the document that staffers for Sen. Joe Manchin III (D-W.Va.) circulated at the bipartisan energy meeting on Monday night. But first:

Commerce Department probe clouds outlook for domestic solar industry

When President Biden took office, the outlook for the clean energy industry was sunny, with nary a cloud in sight.

Biden promised to make America a leader in erecting wind turbines and installing solar panels after four years of Donald Trump, who mocked the science of climate change and falsely claimed that wind turbines cause cancer.

But more than a year into Biden's presidency, solar industry executives are sounding the alarm over a recent federal decision that could chill the growth of solar energy nationwide, undercutting the administration's own climate objectives.

More than 50 senior solar executives visited Capitol Hill on Wednesday to warn against the Commerce Department's probe into solar modules from four Southeast Asian nations, which could result in retroactive tariffs as high as 240 percent.

The investigation will cut expected solar installations by 46 percent for 2022 and 2023 and could cost more than 100,000 solar jobs should the department impose the tariffs, according to an analysis released yesterday by the Solar Energy Industries Association (SEIA), which organized the congressional meetings.

The probe is “already having a pretty devastating impact,” SEIA President and CEO Abigail Ross Hopper told The Climate 202.

Here's what to know about the investigation and how it's casting a pall over the clean energy sector:

Auxin's allegations

The Commerce Department opened the investigation on April 1 in response to a petition from Auxin Solar, a small California-based manufacturer. Auxin alleged that solar panels assembled in four Southeast Asian countries — Cambodia, Malaysia, Thailand and Vietnam — are circumventing rules intended to block solar imports from China.

Solar developers have called these allegations false and slammed the decision to launch the probe, saying that merely the prospect of expanded tariffs has caused project delays and cancellations.

“A lot of Asian-based manufacturers just aren't supplying the U.S. because they're not taking the trade risk,” Brad Farrell, CEO of BayWa r.e. Power Solutions, a utility-scale solar and battery storage provider, told The Climate 202.

Suzanne Leta, senior director and head of policy and strategy at SunPower, told The Climate 202 this is the most widespread uncertainty she has seen in the market since joining the solar industry in 2006. 

Auxin Solar CEO Mamun Rashid said in an email that he was grateful the Commerce Department accepted his request to “enforce the U.S. law and to stop trade cheating.”

“If foreign producers do not follow the law, they should be held to account,” Rashid said.

The Auxin probe comes after Biden extended Trump-era tariffs on imported solar equipment but left in place a key exemption for two-sided panels used in most utility-scale projects.

Climate goals in the balance

Biden has set ambitious targets for zeroing out planet-warming emissions from the electricity sector by 2035 and from the entire economy by mid-century.

A Commerce Department spokesman said in an email that the department “will conduct an open and transparent investigation to determine whether circumvention” of U.S. trade law is occurring. 

“Combatting climate change is a key priority for the Biden-Harris Administration, and solar power will be essential to reaching the President’s ambitious goal of net-zero economy-wide emissions by 2050,” the spokesman added. 

But Heather Zichal, CEO of the American Clean Power Association, a renewable-energy trade group, said the investigation poses an “existential threat” to the domestic solar industry.

“As an industry, we're just all kind of scratching our heads, saying, ‘This was an administration that was supposed to … be leading the charge on providing clean, affordable energy,’” said Zichal, who was a White House energy adviser under Barack Obama.

Hitting the Hill

On the Hill yesterday, the solar executives met with lawmakers and staffers in nine Democratic House offices, including House Select Committee on the Climate Crisis Chair Kathy Castor (Fla.), and 19 Democratic Senate offices, including Sen. Edward J. Markey (Mass.).

Dan Whitten, vice president of public affairs at SEIA, said the executives only met with Democrats because they also pushed for the passage of Biden's stalled party-line spending bill, which contains tax credits that would lower the cost of installing solar panels.

Meanwhile, Sen. Jacky Rosen (D-Nev.), who led a bipartisan letter in March raising concerns with Auxin's petition, questioned Commerce Secretary Gina Raimondo about the probe during a Senate Commerce, Science and Transportation Committee hearing yesterday.

The tariffs would “jeopardize tens of thousands of good-paying American jobs, raise energy prices for consumers and also undermine the administration's clean energy [and] climate goals,” Rosen said.

Commerce has until Aug. 29 to make a preliminary determination on the probe. When pressed by Rosen, Raimondo would not commit to making an expedited decision.

On the Hill

Scoop: Manchin aides circulated document at bipartisan energy meeting that emphasized energy security, nuclear, carbon capture

Staffers for Sen. Joe Manchin III (D-W.Va.) circulated a document at a bipartisan energy meeting on Monday night that emphasized the need to bolster Europe's energy security and listed certain technologies that could attract bipartisan support, such as nuclear power and carbon capture, according to a copy of the document obtained by The Climate 202. 

The handout's authenticity was confirmed by three individuals familiar with the meeting, who spoke on the condition of anonymity because they were not authorized to comment publicly.

“The United States and the world face two fundamental challenges: ensuring energy security and combatting climate change,” the document says. “These require simultaneous and significant policy responses that do not compromise energy reliability.”

The document lists several points about climate and energy security, such as that the United States “has fallen behind” the European Union and China in nuclear energy, and that International Energy Agency Director Fatih Birol has called carbon capture “vital to meeting climate goals.”

The second page of the handout summarizes the climate investments in the president's stalled reconciliation bill, formerly known as the Build Back Better Act, along with scores from the Congressional Budget Office.

The document was meant to be a starting point for the bipartisan energy talks led by Manchin and Sen. Lisa Murkowski (R-Alaska), not a fully fleshed-out list of provisions that could attract 10 Republican votes, according to one of the individuals familiar with the meeting.

There could be broad bipartisan support for an energy package that reduces Western Europe's dependence on Russian gas amid the war in Ukraine, the person said, given that the climate provisions in the House-passed version of the China competitiveness bill have little realistic chance of making it into the final package.

Agency alert

FERC in turmoil over climate rules

In February, the Federal Energy Regulatory Commission made a move to, for the first time, consider new gas pipelines’ effects on climate change and environmental justice — but it didn’t last. 

Since then, the agency has been strong-armed by Congress, with both parties treating FERC as another weapon to be wielded in either advancing or blocking efforts to tackle the climate crisis, The Washington Post's Anna Phillips and Tyler Pager report.

The commission, which otherwise was known to stay out of politics, backtracked in March, voting to recategorize the rules instead as drafts after Republican lawmakers and industry executives said the regulations were outside of its authority. Climate advocates responded by saying the agency gave in to political pressure. The agency, which is made up of three Democrats and two Republicans, is now deadlocked. 

Biden administration eyes offshore wind expansion in Mid-Atlantic, Oregon

The Interior Department's Bureau of Ocean Energy Management announced Wednesday that it is soliciting public and industry feedback on a new round of offshore wind leases off the Mid-Atlantic states and the Oregon coast, Heather Richards reports for E&E News. 

The move follows a record-breaking $4.4 billion lease auction in the New York Bight early this year and builds upon the president's goal to deploy 30 gigawatts of offshore wind power by 2030. 

“This is really meant to remove the guesswork about where we’re heading and inspire confidence in the market,” bureau Director Amanda Lefton said during the International Offshore Wind Partnering Forum in Atlantic City on Wednesday. 

Energy Dept. authorizes more LNG export projects as Russia cuts supply to Europe

The Energy Department on Wednesday authorized additional liquefied natural gas exports from two plants that are under construction to boost energy independence amid Russia’s invasion of Ukraine.

During an offshore wind forum on Wednesday, Energy Secretary Jennifer Granholm said the approvals are about “making sure that we are able to allow those who intend to produce have the freedom to be able to ship to Europe,” in light of Russia’s recent move to cut gas shipments to Poland and Bulgaria. 

Asked about the Biden administration’s plans to increase LNG exports to Europe, European Energy Commissioner Kadri Simson said at the forum that short-term shipments from the United States would help Europe now, but that the bloc remains committed to ambitious renewable energy targets for the long term. 

Pressure points

Massive wildfires fueled global forest losses in 2021

As wildfires last year scorched treetops at an unprecedented rate — accounting for more than a third of the world’s tree cover losses — logging, insect infestations and the expansion of agriculture also contributed to the disappearance of vast forests. 

In the end, more than 97,500 square miles of tree cover vanished during 2021, equaling an estimated 2.5 gigatons of carbon dioxide pollution, according to a satellite-based survey published today by the University of Maryland and Global Forest Watch, The Post's John Muyskens, Naema Ahmed and Brady Dennis report.

Fires, which are linked to global warming and have raged across the Amazon, the Arctic, the American West, Australia and parts of Africa and Asia, can become yet another source of pollution, creating a loop that both worsens fires and hastens climate change. If forests continue to decline, the likelihood of the world limiting catastrophic warming in accordance with the Paris agreement becomes smaller and smaller.

In the atmosphere

Viral

Thanks for reading!

Loading...