Daily on Energy: Solar firm steps forward in bid for duties on Asian imports

California-based Auxin Solar Inc., which manufactures solar cells, accused cell and module manufacturers in Vietnam, Malaysia, Thailand, and Cambodia of circumventing existing duties on imports from China, or functionally acting as pass-throughs for Chinese products that would otherwise be subject to such duties.

Auxin asked Commerce to “promptly initiate an anti-circumvention inquiry concerning solar products assembled and completed in other nations using Chinese produced inputs” in a request to the department earlier this week.

The prequel: Recall how the most recent anti-dumping and countervailing duties battle shaped up. A group of domestic solar product manufacturers, which called itself American Solar Manufacturers Against Chinese Circumvention, petitioned Commerce to take the same action against imports from those countries (although Cambodia was not among the targets).

Commerce eventually came back and said the petitioners would have to identify themselves in order for the department to continue forward with the process, but A-SMACC never moved. That decision effectively put an end to their petition effort.

Breaking down the case: This new petition revives the argument brought forward in that case, which is that most of the heavy lifting on cell and module products from listed countries is actually accomplished in China and that they should be subject to duties just as Chinese imports are.

Auxin makes the case that it and like domestic manufacturers suffer injury from these imports and, moreover, that inputs in the products are generated in a country with forced labor and that reliance on China conflicts with U.S. climate change goals, due to its heavy reliance on coal.

What opponents are saying: What Auxin’s petition asks for would amount to an “abuse” of U.S. trade law and would not achieve the desired ends of making more of these products at home, said John Smirnow, general counsel and vice president of market strategy for the Solar Energy Industries Association.

“Tariffs are not how you grow a solar manufacturing base,” Smirnow, whose trade group represents firms across the solar industry, told Jeremy. “They’re not designed to incentivize companies to build factories to expand capacity… They’re not an industrial policy growth tool.”

Smirnow also argued the request fails to demonstrate that targeted exports reach the threshold which Commerce generally uses for imposing these kinds of duties.

“If you’re doing cell manufacturing and module manufacturing together, or selling independently, it is a significant manufacturing operation, and for the government to conclude otherwise, [would go] against a decade of precedent,” he said.

Solar politics: Auxin’s request puts the Biden administration back in the position of, at least superficially, making a choice between domestic solar manufacturers and foreign ones, upon whose products many solar firms rely.

Finding a balance between the two to please all parties has been difficult, because the administration wants solar technology deployed rapidly to cut greenhouse gas emissions on the one hand, and domestic solar firms aren’t manufacturing at a scale large enough to enable that alone.

At the same time, Biden and Democrats want more of these products to be made at home by American workers, and to that end, the House just passed legislation that would fund $3 billion in grants and loans for the construction of new facilities that manufacture components used in solar energy products.

Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writer Jeremy Beaman (@jeremywbeaman) and Breanne Deppisch (@breanne_dep). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.

UTILITIES HEADS WELCOME BIDEN’S ENERGY AGENDA: Leaders of several utilities met with Biden yesterday and praised the energy and climate change-related items in the insentient Build Back Better Act.

The CEOs talked over their existing renewable energy portfolios and welcomed the hundreds of billions in funding proposed for green energy subsidies.

“This legislation is going to allow us to be carbon-free sooner, gives us renewable portfolio standards, allows us to securitize to keep costs down for customers,” Patricia Vincent-Collawn, president and CEO of New Mexico-based PNM Resources, said during the roundtable.

Biden urged to shun nuclear: Green activists with the Environmental Working Group pressed Biden to reject any request to provide any more financial support to nuclear power plants during the meeting.

EWG President Ken Cook called nuclear power “a relic of the electricity sector” and a “dangerous and extremely expensive one that has cost taxpayers billions of dollars.”

But the administration isn’t likely to be sympathetic. Energy Secretary Jennifer Granholm endorses nuclear power, and Congress just authorized nearly $8.5 billion in the infrastructure law to fund advanced reactor development and support the nation’s economically challeneged plants.

ON THE ‘BUILD BACK BETTER’ SUBJECT: The White House is considering a rebrand of Biden’s agenda now that it’s without movement in Congress, the Washington Examiner’s Katherine Doyle reports.

“Our objective is working with Democrats, Republicans … to determine how much of the president’s Build Back Better agenda, whatever you call it, can be moved forward,” Press Secretary Jen Psaki said yesterday and responded “sure” when asked whether a name change of the bill was on the table.

At least one Democrat who supports the legislation has said it’s time to call the package something else.

“That old name needs to go in the trash can,” Hawaii Sen. Brian Schatz said last week. He added, “Joe Manchin has been pretty clear he’s not voting for Build Back Better. So we need to work on something else.”

WHITE HOUSE, DOT OFFER NEW DETAILS ON EV FUNDS: The White House and the Department of Transportation issued a new statement today offering new details on how states can access nearly $5 billion in infrastructure funding to help meet the administration’s goal of building out a national network of electric vehicle charging stations over the next five years.

In its statement, DOT said it is making available $615 million in charging station funds to states this fiscal year. Any states hoping to receive those funds, it said, must first distribute an EV Infrastructure Deployment Plan describing how it plans to use its share of funds to the newly created Joint Office of Energy and Transportation.

Those plans must be consistent with criteria from the National Electric Vehicle Infrastructure (NEVI) Formula Program — a new effort established by the infrastructure bill — as well as the Federal Highway Administration, which is tasked with administering the funds.

“A century ago, America ushered in the modern automotive era; now America must lead the electric vehicle revolution,” said U.S. Transportation Secretary Pete Buttigieg. “The President’s Bipartisan Infrastructure Law will help us win the EV race by working with states, labor, and the private sector to deploy a historic nationwide charging network that will make EV charging accessible for more Americans.” Read the full statement here.

A COLD NEW ENGLAND LEANS ON OIL-FIRED POWER: Utilities in the northeast turned to oil-fired generators to help meet electricity needs for New Englanders last month, when temperatures were down and natural gas prices way up.

Such generators “can be dispatched when the wholesale price of electricity is high enough that running the generator is economical,” the Energy Information Administration said in a blog post this morning.

And power prices in the region are high, in large part because of the region’s high gas prices. Natural gas on the New England benchmark Algonquin Citygate trading hub averaged $20.55 per million British thermal units in January, a 145% increase from the $8.38 per MMBtu level it averaged in December.

Data for January wholesale electricity prices are outstanding, but regional grid operator ISO New England has said power prices in the region during December were 42% higher on average than in December 2020. Day-ahead power prices rose 62% over the same period.

EUROPEAN SCIENTISTS ANNOUNCE ‘MAJOR BREAKTHROUGH’ ON NUCLEAR FUSION ENERGY: Scientists at the U.K.-based JET laboratory announced they have achieved “record-breaking” results on a landmark nuclear fusion experiment. According to researchers at the Oxfordshire-based lab, the team successfully squeezed together two forms of hydrogen for a period of five seconds, allowing them to produce 59 megajoules, or 11 megawatts, of energy––more than double the record set in 1997.

While the energy output itself is nothing to write home about (according to the BBC, it’s enough to boil roughly 60 kettles of water) scientists say it’s a major validation of their design choices in crafting fusion reactor––a bigger version of which is currently being built in France––and puts scientists one step closer to creating what would be a “virtually unlimited supply” of low-carbon, low-radiation energy on Earth.

“The record, and more importantly the things we’ve learned about fusion under these conditions and how it fully confirms our predictions, show that we are on the right path to a future world of fusion energy,” Tony Donne, the program manager at EUROfusion, told reporters yesterday.

Described by some as the “power plants of the future,” nuclear fusion relies on the process of forcing together hydrogen atoms using super-heated forms of gas, or plasma, inside a magnetic field. It’s the opposite of fission, which currently powers nuclear plants worldwide.

And though we are likely years away from commercialization of fusion-powered energy, it’s considered a game-changer since it offers a carbon-free form of energy––generating only short-lived, minimal amounts of radioactive waste.

Fusion offers a “near-limitless green electricity source for the long term, using small amounts of fuel that can be sourced worldwide from inexpensive materials,” according to a statement released by the JET project.

“If we can maintain fusion for five seconds, we can do it for five minutes and then five hours as we scale up our operations in future machines,” Donne said.

NORD STREAM 2––THE VIEW FROM UKRAINE: While much of the Western world continues its hand-wringing over whether to block Nord Stream 2 as a form of retaliation should Russia invade Ukraine, one of Ukraine’s most senior diplomats reiterated his country’s long-standing concerns over the controversial gas pipeline––stating that, in their view, Nord Stream 2 should never open at all.

Asked about the pipeline in an interview yesterday with Sky News, Ukraine’s EU ambassador Vsevolod Chentsov responded, “Look, the Ukrainian position is very clear. Europe does not need this pipeline, so it is a 100% politically motivated project. If your question is whether this pipeline should be turned on––ever–– then our answer is no.”

He continued, “It cannot be used as a weapon against Ukraine, but also against EU member states, because the more leverage that Russia has, the less that Europe is secure.”

His comments come as German Chancellor Olaf Scholz has demurred on directly committing to abandoning the pipeline, revealing a potential sticking point between his government and Biden, who vowed Monday to block Nord Stream 2 in the event of a Russian invasion.

“All the steps we will take we will do together,” Scholz told CNN of his country’s relationship with the U.S. “You can understand and you can be absolutely sure that Germany will be together with all its allies and especially the United States, that we take the same steps. There will be no differences in that situation.”

NEW YORK PENSION PLANNING FOSSIL DIVESTMENT: New York state’s pension fund will divest more than $238 million worth of shares in oil and gas companies following an internal review that the firms lack adequate plans to reach net-zero emissions, Bloomberg reported.

The $280 billion fund holds stock in 42 oil and gas companies, and planned divestments include Pioneer Natural Resources Co. and Hess Corp.

The fund must be aligned “with a profitable and dynamic future” and the oil and gas industry faces “numerous obstacles going forward that pose risks to its financial performance,” Comptroller Thomas DiNapoli said.

The Rundown

Washington Post Dams alter river temperatures and endanger fish, yet 3,700 more will be built

Financial Times EU recovery fund gives Spain ‘once in a lifetime’ chance to fight climate change

Calendar

TUESDAY | FEB. 15

2:30 p.m. The House Select Committee on the Climate Crisis will hold a remote hearing entitled “Keeping the Lights On: Strategies for Grid Resilience and Reliability.”