Commerce secretary defends China solar tariff probe despite clean energy project freeze

Commerce Secretary Gina Raimondo on Wednesday countered bipartisan criticism that the agency has cast a shadow over the solar industry.

Biden Cabinet officials have defended an investigation into whether China defied U.S. tariffs by secretly supplying solar panel components to Southeast Asian manufacturers, which has forced the solar industry to hit the pause button and go into panic mode.

Ms Raimondo said her hands were largely tied as the department was “obliged” to investigate allegations by a small Californian solar panel maker that China was exploiting four nearby countries – Malaysia, Thailand, Cambodia and Vietnam – Ship components to the U.S. or face trade taxes.

About 80 percent of imported solar panels come from these four countries, according to the Clean Energy Association of America. More than 300 solar projects have been halted, potentially putting tens of thousands of clean energy jobs at risk, according to a survey of businesses by the Solar Energy Industries Association.

“We have to move quickly to meet our climate goals, but as I said … there is a process, there is a law,” Ms Raimondo told members of the Senate Commerce Committee. “I have to enforce the law.”

The Commerce Department won’t make an initial decision on whether China avoids U.S. import duties until the end of August, and Ms. Raimondo said the department will work to expedite that timeline. But she said she was reluctant to interfere in the civil service watchdog’s investigation as a political appointee.

Sen. Brian Schatz, Democrat of Hawaii, was unhappy and called for more urgency.

“You do have more discretion for individual participation, which doesn’t jeopardize the independence of the investigation, and there’s nothing wrong with informing Congress about the status of the investigation,” he said. “With the U.S. solar industry at a standstill, We’re in a very, very urgent situation.”

Ms. Raimondo agreed with Sen. Jerry Moran, a Kansas Republican, that Congress and the Commerce Department should join forces to develop stricter standards for conducting such investigations to prevent future roadblocks to the industry.

The U.S. solar industry has warned that the Commerce Department could impose 200 percent tariffs if wrongdoing is found. However, Ms Raimondo called the result “highly unlikely” because it “doesn’t fit the precedent we already have”. She tried to assuage doubts by saying that somewhere in the 10-12% range might be more appropriate.

Lawmakers and the industry have questioned the accuracy of Auxin Solar’s February petition that China cheated on U.S. tariffs, sparking an investigation.

Mr Moran wondered how “a small, single company with no access to classified information could actually provide the data necessary to meet statutory requirements to initiate an investigation”, which “was causing considerable damage to business in the United States”.

Ms Raimondo said the company’s complaint met the Commerce Department’s standards, thus forcing them to move forward.

There is no clear timeline for when the Commerce Department will issue its ruling. Acknowledging the difficulties facing the industry, Ms Raimondo would only say “if we can do better than August, we certainly will”.

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