Recently, the US International Trade Commission put forward a proposal that from February 2022, the implementation period of the "201 tariff" for imported photovoltaic cells and modules will be extended by 4 years. Regarding this proposal, the American Solar Energy Industry Association and many other industry organizations have raised objections, saying that the imposition of tariffs on photovoltaic imports has not only failed to protect the domestic manufacturing industry in the United States, but has caused tens of thousands of unemployment, and has seriously hindered the development of the domestic photovoltaic industry in the United States. Development will even jeopardize the achievement of the United States’ climate goals.

The effect of imposing tariffs for many years has been counterproductive

Based on multiple foreign media reports, on December 8, the US International Trade Commission submitted a report on the domestic photovoltaic manufacturing industry in the United States, stating that "the 201 tariff has played a positive role in adjusting foreign competition." The US photovoltaic industry still needs trade in the future. It is recommended that the US government extend the "201 tariff" for 4 years.

Up to now, US President Biden has not made a final decision on this, but the industry has responded strongly. Abigail RossHopper, CEO of the American Solar Energy Industry Association, said: "The growth of American photovoltaic manufacturers is critical to the long-term development of clean energy in the United States, but the effect of photovoltaic tariffs for many years has not been satisfactory. Now the United States has developed clean energy. Electricity installation targets, and extending these tariff deadlines is likely to hinder the United States from achieving this goal."

It is understood that in January 2018, the U.S. government proposed for the first time to impose tariffs on imported photovoltaic cells and modules for a period of four years, known as the "201 tariffs." This tariff rate starts from 30% and drops to 15% in the final year, and is expected to expire early next year.

According to statistics from the American Solar Energy Industry Association, during the more than three years of implementing the "201 Tariff", the US photovoltaic industry has not only not ushered in a large-scale employment wave, but has lost 62,000 jobs. At the same time, private investment in the photovoltaic industry has lost 19 billion yuan. Dollar. Not only that, in 2018, the total volume of imported photovoltaic cells and new installed capacity in the United States both plummeted to as low as 6.8 million kilowatts, a year-on-year drop of 66.7%. In sharp contrast to this, after the tariff rate has been reduced and partial exemptions have occurred, the installed capacity of photovoltaics in the United States has rebounded.

In the view of the American Solar Energy Industry Association, poor financing is the main problem facing the expansion of the US photovoltaic manufacturing industry. Coupled with the recent adverse effects of the new crown pneumonia epidemic, it has also brought challenges to the US photovoltaic industry.

The local supply chain obviously "cannot keep up"

According to data released by the market research agency Resta Energy, although the United States imposes additional tariffs on imported photovoltaic products, in fact the dependence of the US photovoltaic industry on imported products has not decreased. In 2021, the total amount of photovoltaic cells imported by the United States reached 27.8 million kilowatts, and the total amount of photovoltaic imports reached 8.9 billion U.S. dollars, all setting record highs.

From the perspective of import source countries, Malaysia and Vietnam are the top two sources of US photovoltaic product imports in 2021, accounting for 31% and 28.8% of the market respectively, by Thailand and South Korea. At the same time, there are only less than 1% of photovoltaic products come from non-Asian countries.

According to data from the American Solar Energy Industry Association, in 2020, the domestic production of crystalline silicon in the United States was 2.2 million kilowatts, an increase of 371.85% compared to 2018, but in fact, during this period, the newly installed photovoltaic power in the United States reached 19.2 million kilowatts. This also means that the US-made crystalline silicon still accounts for less than 15% of the market.

Resta Energy analysis pointed out that although the main purpose of the U.S. tariffs on imported photovoltaic products is to protect local photovoltaic manufacturers, in fact, these tariffs are ultimately borne by American photovoltaic developers. The development has actually pushed up the production cost of photovoltaic cells.

Resta Energy Renewable Energy Analyst Marcelo Ortega said: "The U.S. photovoltaic tariffs have pushed up battery costs and to some extent helped the photovoltaic manufacturing industry chain to move to other countries. U.S. policymakers should re-examine this strategy. In fact, preferential policies such as tax credits may be more conducive to the growth of local photovoltaic and wind power installations."

Future PV installations may be dragged down

Since the beginning of this year, the US government has repeatedly proposed that it will promote the development of clean energy. The goal announced by the US Energy Information Administration shows that by 2035, the proportion of photovoltaic power generation in the United States will increase from the current 3% to 14%; by 2050, it will strive to have 20% of the electricity supply from photovoltaics. Not only that, Biden is also vigorously promoting the "Rebuild Better" bill. The industry generally believes that once the bill is passed, the US photovoltaic industry will enjoy tax credits, credit incentives and other favorable policies.

However, according to Michelle Davis, chief photovoltaic analyst at Wood Mackenzie, although the introduction of policies is expected to boost the market, the upstream of the US photovoltaic industry chain is still heavily dependent on imports. There is a risk of supply shortage, and the development of the US photovoltaic industry is still full of difficulties.

The report jointly issued by Wood Mackenzie and the American Solar Energy Industry Association shows that since this year, the inflation rate of the US economy has reached 6.8%, a record high in nearly 39 years, which has greatly pushed up the cost of photovoltaic projects. At the same time, because the U.S. photovoltaic industry is highly dependent on the industrial chain outside of the country, due to the impact of the new crown pneumonia epidemic, severe congestion at many major U.S. import ports, shortages of transportation equipment, reduced transportation efficiency, and shortage of workers have all pushed up the cost of photovoltaic logistics. This year, the U.S. The logistics cost of importing photovoltaic components from Asian countries has increased by 2-3 times compared with before the epidemic.

For this reason, the aforementioned joint report warned that the imperfection of the photovoltaic supply chain and rising costs are likely to affect the growth of photovoltaic installations in the United States in the next two years. In the next 12 months, the growth of photovoltaic installations in the United States may be 25% slower than expected. Abigail RossHopper even called for the US government not to "repeating mistakes" and extending tariffs on imported photovoltaic products "will only make the US photovoltaic industry worse" and that these ineffective policies should be stopped as soon as possible.