US solar suppliers call for retroactive tariffs; Developers predict record solar installations
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US solar manufacturers call for retroactive tariffs on Vietnam, Thailand
A group of U.S. solar module manufacturers has asked the Department of Commerce to impose retroactive tariffs on panels made in Vietnam and Thailand following a surge in imports.
The Commerce Department is investigating whether cells and modules made in factories in Vietnam, Thailand, Malaysia and Cambodia were sold in the U.S. at excessively low prices while benefiting from subsidies from China.
The investigation could lead to anti-dumping and countervailing duties (AD/CVDs) and was prompted by a petition filed in April by the American Alliance for Solar Manufacturing Trade Committee (AASMTC), which represents U.S.-based manufacturers including First Solar and South Korean group Hanwha Qcells.
In their latest complaint, the AASMTC said U.S. imports from Vietnam and Thailand have surged since their April filing. The volume of solar imports from Vietnam and Thailand rose 39% and 17% respectively in the second quarter compared with the first quarter, the committee said.
Forecast China share of global solar manufacturing
Source: International Energy Agency's Renewables 2023 report (January 2024).
A surplus of Chinese solar products has crushed global solar prices and raised fears over the future of U.S. and European solar manufacturers.
The solar price slump is hampering U.S. plans to expand domestic production through tax credits issued under the 2022 Inflation Reduction Act.
In April, the Biden administration doubled U.S import tariffs on Chinese solar cells and panels from 25% to 50% and ended a two-year exemption on import tariffs for bifacial panels made either in China or in the four Southeast Asian countries of Malaysia, Cambodia, Thailand and Vietnam, where many Chinese manufacturers have shifted operations. Most U.S. solar developers are sourcing bifacial panels from Malaysia, Cambodia, Thailand and Vietnam.
Biden imposed the two-year tariff exemption for bifacial panels until June 2024 to support solar deployment while domestic manufacturing is expanded but factory growth has been slower than many had hoped.
Solar developers wanted the tariff exemption extended to keep prices low and give them a wider choice of supplier.
Biden raises tariff quota for solar cells to 12.5 GW
U.S. President Joe Biden has raised the volume of solar cells that can be imported tariff free, from 5 GW annually to 12.5 GW, to aid U.S. module manufacturers dependent on components made overseas.
The tariffs are currently at 14.25% and were set by the Trump administration to protect U.S. manufacturers from low-priced imports, mainly from Asia.
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U.S. solar deployment is surging and manufacturing growth is lagging behind, despite new tax credits in the 2022 Inflation Reduction Act.
Many U.S. developers are looking to source American modules in the coming years, due to new tax credits and increasing uncertainty over imports, but U.S. supply chain plans are being hampered by a surplus of modules from China which has driven down global prices. U.S. module imports hiked 82% in 2023 to 54 GW on the back of rapidly falling prices.
U.S. module manufacturing capacity is rising but growth in cell, wafer and polysilicon production is far slower and medium-term growth is uncertain due to the current oversupply of modules and other supply and demand factors that are deterring new announcements.
The U.S. Solar Energy Industry Association (SEIA) welcomed the President's decision to increase the tariff quota.
"This move provides an important bridge for module producers to access the supply they need while the United States continues to progress on solar cell manufacturing," the industry group said. "This decision will help create a strong, stable module manufacturing sector that can sustain robust cell production in the long run."
US developers plan record solar capacity in 2024
U.S. developers installed 12 GW of utility-scale solar in the first half of 2024 and they plan to install 37 GW by the end of the year, the U.S. Energy Information Administration (EIA) said, based on data gathered from generators.
"If utilities add all the solar capacity they are currently planning, solar capacity additions will total 37 GW in 2024, a record in any one year and almost double last year’s 18.8 GW," it said.
Most solar developers are including battery storage in their projects and 15 GW of new large-scale battery capacity is expected on line this year after 4.2 GW was installed in January-June, EIA said.
Planned US utility-scale power additions in 2024
(Click image to enlarge)
Source: U.S. Energy Information Administration (EIA), August 2024
Solar power is dominating U.S. power additions as developers capitalise on tax credits in the 2022 Inflation Reduction Act and years of cost reductions.
President Biden aims to decarbonise the power sector by 2035, requiring around 60 GW of annual solar installations, including smaller projects, within the next few years.
The U.S. installed a record 40 GW of solar power in 2023 but flat growth has been forecast in 2024 and 2025 as developers face grid connection queues, permitting challenges and uncertainty over solar module prices.
Get the latest data on U.S. energy storage deployment in our free market report.
Texas and Florida installed 38% of all U.S. utility-scale solar additions in the first half of this year, EIA said.
The largest projects to come online were the 690 MW Gemini solar and storage facility in Nevada and the 653 MW Lumina solar project in Texas.
Battery storage installations were concentrated in four states with California representing 37% of all installations, followed by Texas (24%), Arizona (19%), and Nevada (13%).
The largest battery to come online was the 380 MW battery installed at the Gemini facility in Nevada.
Natron plans to build 24 GW sodium-ion battery factory
Natron Energy plans to build a 24 GW sodium-ion battery manufacturing plant in North Carolina, raising the company's production capacity by 40 times, the Californian group announced on August 15.
Natron currently produces 600 MW of sodium ion battery capacity at a factory in Holland, Michigan.
As power demand grows, the company aims to "transform critical power, industrial and grid energy storage markets by providing customers with batteries that offer higher power density, faster recharge, and a significantly longer cycle life than incumbent technologies," it said.
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The new $1.4 billion facility would be located in Edgecombe County and North Carolina has agreed to provide up to $21.75 million in potential reimbursements over 12 years, Natron said. Edgecombe County is expected to apply for a $30 million grant from a new state funding program for industrial site renovations, it said.
Lithium ion batteries currently dominate the energy storage market but sodium ion batteries will gain an increasing share of the energy storage market as they do not require lithium or other difficult-to-obtain minerals and production costs can be 30% less than lithium ion batteries, the International Energy Agency (IEA) said in April.
Natron currently manufactures sodium-ion battery products for a variety of industrial applications "ranging from critical backup power systems for AI data centers to EV fast charging and system hybridization," the company said.
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