April 28 update: The full House has passed the CRA and it now moves to the Senate.
Original story below:
A Congressional Review Act (CRA) to repeal President Joe Biden’s 2022 two-year moratorium on new solar tariffs is now officially in motion. The House Ways and Means Committee approved the CRA earlier today.
A CRA law allows Congress to reverse federal rules with a simple majority. In June 2022, the Biden Administration announced it would pause for two years any new tariffs related to an AD/CVD circumvention case working its way through the Dept. of Commerce “in order to ensure the U.S. has access to a sufficient supply of solar modules to meet electricity generation needs while domestic manufacturing scales up.”
When the AD/CVD investigation into whether Chinese companies were working in Cambodia, Malaysia, Thailand and Vietnam as a way to skirt existing tariffs against Chinese solar imports first began, solar module supply from the region effectively stopped. The four Southeast Asian countries had previously supplied at least 80% of the solar panels installed in the United States. Biden’s two-year pause allowed modules to continue to be imported without the threat of retroactive duties.
Now that the CRA has passed the House committee, it goes to a vote by the full House and then on to the Senate. If the CRA would pass both chambers, President Biden would have the ability to veto the measure (which is likely since it was his original executive action). A two-thirds majority in both chambers could then overpower the presidential veto.
“The United States currently lacks the capacity to produce solar panels and cells in adequate volumes to meet domestic demand. The two-year duty moratorium allows planned solar installations to move forward while we scale domestic manufacturing in the near-term,” said Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association (SEIA), in a statement. “The Committee’s vote will end up hurting businesses that are trying to create jobs and support our communities. When the bill comes to the House floor, we hope lawmakers vote to protect American workers and support American manufacturing.”
If the CRA passes, SEIA projects that 4 GW of planned solar projects will get canceled, which is 14% of the solar industry’s anticipated deployment in 2023 and would result in a loss of $4.2 billion in private clean energy investments. The project cancelations would be due to increased costs on the solar panel imports.
“This massively disruptive resolution would have a devastating impact on the U.S. solar industry,” said Gregory Wetstone, president and CEO of the American Council on Renewable Energy (ACORE), in a statement. “The imposition of retroactive solar tariffs will create needless market uncertainty, further hampering our ability to meet America’s critical decarbonization goals. President Biden’s two-year tariff moratorium is a practical compromise that allows continued access to imported components while domestic manufacturing ramps up.”