A lawsuit against China filed in February by Auxin Solar, a small player in the U.S. photovoltaic industry, has not stopped making waves in the United States. It has destabilized the entire solar industry in the United States and pushed President Joe Biden on Monday to invoke exceptional powers to promote “made in USA” solar panels.
Joe Biden has solar panels in his eyes. An American presidential decreeadopted Monday, June 6, multiplies initiatives to increase U.S. production and imports of solar panels.
On that occasion, the US President invoked a Korean War Exception Law which forces U.S. producers to focus on certain products. In 1950, it was armaments, this time solar panels, meant to help the United States reduce its dependence on fossil and polluting energy sources.
And pending the US production order, this decree also provides for the two-year lifting of tariffs on imports of solar panels sold by Cambodia, Thailand, Malaysia and Vietnam.
The Don Quixote of solar panels?
This decree has been warmly welcomed by climate activists, who have taken turns in recent days to congratulate the White House tenant. “This is a big step in the right direction for the government, which recognizes that we are facing a climate emergency that requires a general mobilization worthy of World War II to ensure the transition to renewable energy as soon as possible.” , said Varshini Prakash, deputy director of the Sunrise Movement, a youth group that stands to the left of the Democratic Party. “We hope that this decree will mark a turning point in the administration’s policy in favor of measures to better combat global warming,” added Jean Su, head of energy issues at the Center for Biological Diversity, an NGO working for the protection of endangered species.
Solar professionals also applauded the presidential initiative with both hands, points out The Guardian. All? No, because a voice has risen to denounce the temporary raising of tariffs. “By taking this unprecedented move, the president has just opened the door to pro-Chinese interests that are working to circumvent US trade law enforcement,” said Mamun Rashid, CEO of Auxin Solar. a modest American solar panel manufacturing company, interviewed by the Financial Times Tuesday, June 7th.
Until recently, this entrepreneur’s stance was low on solar and photovoltaics (transforming the sun’s rays into electricity), and even less so in the national debate. His company does not produce more than 2% of the solar panels sold in the United States.
But all that changed in late February 2022 when Mamun Rashid decided to become a sort of Don Quixote of American solar panels at war with Chinese photovoltaic mills. He had then filed a complaint with the Trade Secretariat, accusing China of illegally circumventing tariffs on exports of solar panels.
It is, paradoxically, the facts and deeds of this detractor of the presidential decree that partly motivated Joe Biden to come to the rescue of the U.S. solar panel industry, the Financial Times points out.
Because behind the headlines in the media about this presidential decree is the short story of a California-based company with just 50 employees that has grown in a matter of months. “the most hated company in the solar energy community“, according to the Wall Street Journal.
A serious investigation into the consequences
This descent into reputed hell dates back to the beginning of the year. A handful of U.S. photovoltaic panel makers then lament the failure of Chinese solar panel tariffs introduced in 2012 by then-President Barack Obama. tells the Washington Post.
The move was supposed to boost US production, which was unable to compete with Chinese companies heavily subsidized by Beijing and with much cheaper labor.
But after China, the United States fell into the solar panel of Thailand, Cambodia, Vietnam and Malaysia. Unfortunate U.S. competitors quickly suspected Beijing of using leading companies in these four Asian countries to evade tariffs. Some of them decided to file a complaint against China anonymously with the Trade Secretariat.
The latter did not want to launch an investigation until the complainants came forward in disguise. That’s when Auxin Solar will take up the complaint on its behalf.
An investigation was then officially launched in March by the Biden administration to determine the merits of the complaint. And it was this procedure that “brought the entire U.S. photovoltaic industry to its knees,” the Washington Post said.
Indeed, if the authorities decide that Auxin Solar is right, all imports of solar panels or components from Asia will be subject to tariffs of up to 50% of the amount of panels sold. Including retroactively.
And that’s where the bat hurts. No one wants to buy equipment from Asia anymore, for fear of having to pay taxes retroactively. Because more than 85% of the panels sold in the United States are made or contain materials produced in one of the four countries covered by Auxin Solar’s lawsuit, the entire U.S. solar market has been launched. ‘stop.
“Nearly three-quarters of all projects in the industry this year have had to be discontinued because of this survey,” Rystad Energy, a U.S. consulting firm, told the Financial Times.
Auxin Solar has been targeted by angry industry professionals. “My employees are harassed online and we receive letters of complaint,” Mamun Rashid told the Wall Street Journal.
The contradictions of American politics
A letter was sent to Joe Biden by 22 senators on May 2, warning the president of the employment implications if the investigation was not completed quickly.
And it would not be just an economic issue. Auxin Solar has been accused of jeopardizing Joe Biden’s commitments to tackling global warming. NISource, a leading player in the energy sector, said in mid-May that it had decided to postpone the closure of its coal-fired power plants due to the paralysis of the solar panel industry. Some media even suggested in barely covered words that Mamun Rashid should be funded by the fossil energy lobby to lead his legal battle.
The latter defended himself, repeatedly assuring that he only engaged his own funds in this case.
The few voices that support Auxin Solar in its approach point out that this whole affair highlights mostly the contradictions of American politics, notes the Washington Post. On the one hand, the United States wants to be tough on Beijing, but on the other hand, its willingness to move to a greener economy still depends heavily on Chinese materials. “This survey is necessary because it shows us how much the United States needs to be independent in the field of renewable energy, because otherwise we are at the mercy of a regime that violates human rights to sell its products cheaper.” points out in the Wall Street Journal Lori Wallach, an international trade specialist for the American Economic Liberties Project, a think tank close to the Democratic Party.