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Two House Republicans are hoping to quash President Joe Biden‘s use of the Defense Production Act to build more solar panel components at home, arguing that doing so will enable more reliance on China rather than reduce it.
The bill challenges one of the main premises underlying U.S. solar manufacturing interests’ campaign for policies supporting more domestic solar production, which is that it will allow the broader solar industry to reduce its heavy reliance on China, a country that currently dominates every stage of the global solar supply chain.
EXXON MADE ‘MORE MONEY THAN GOD’: BIDEN WANTS MORE PRODUCTION FROM OIL GIANT
Rep. Bob Gibbs (R-OH) introduced the Preventing Investments in the Chinese Solar Economy Act of 2022 on Monday, which would amend the DPA to prevent it from being applied to solar photovoltaic modules and other solar panel inputs and would also nullify the memorandum Biden used to invoke the act. Rep. Andrew Clyde (R-GA) co-sponsored the bill.
Gibbs’s office accused Biden of abusing his authority by invoking the DPA on June 6, which he did with the intention of increasing domestic production of cells, modules, solar glass, and other solar panel inputs. Gibbs said further that Biden’s decision would serve Chinese mineral interests.
Gibbs’s announcement was short on explanation as to how Biden’s use of the DPA would help Chinese companies, but any increase in domestic manufacturing could effectively mean more business with China, depending on the origin of key input materials.
The United States has no solar cell or polysilicon wafer manufacturing capacity currently, and China is also responsible for around 90% of global polysilicon production, all of which means that even additional U.S. module manufacturing could still have to use imports connected to China.
Domestic solar manufacturers have sought additional tariffs to displace China-connected cell and module imports, arguing that Chinese companies are dumping their products and have an unfair advantage over American competitors — and that they increase reliance on a geopolitical rival.
Biden effectively rebuffed their efforts with his decision to enact a tariff “bridge” June 6 alongside his invocation of the DPA. The tariff bridge will exempt solar imports from Cambodia, Malaysia, Vietnam, and Thailand from any new antidumping and countervailing duties for two years.
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The move was controversial because the Commerce Department is currently looking into whether such imports, which account for around 80% of the cell and module imports used by U.S. solar project developers, are being sent through factories in the four Asian countries by Chinese companies in order to avoid tariffs.
