April 27, 2023

The Washington Post: Why resuming tariffs on Chinese solar firms threatens U.S. climate goals

Below, we have an exclusive on a new permitting proposal from Reps. Sean Casten (D-Ill.) and Mike Levin (D-Calif.). But first:

To counter China, Congress could reimpose crushing tariffs on solar imports

A growing number of congressional Democrats are backing a measure that would undo President Biden’s temporary pause on crushing tariffs on certain solar imports.

It’s the latest example of how mounting anti-China sentiment in Washington has scrambled traditional political alliances and unnerved America’s clean-energy sector, we report with our colleague Evan Halper.

The outcome of the unfolding political drama could have major consequences — not just for solar energy companies, but also for homeowners hoping to add solar panels to their roofs, motorists wanting to charge electric vehicles with clean power and utilities trying to reduce their carbon footprints. 

China dominates solar supply chains. Figures provided by the research firm BloombergNEF show that Chinese companies make more than 95 percent of the wafers and ingots essential to assembling solar panels.

The details

The measure would undo Biden’s two-year suspension of the tariffs, which apply to solar cells and panels made by Chinese companies but sold out of Cambodia, Malaysia, Thailand and Vietnam. 

  • The White House announced the suspension last summer in an effort to reassure the domestic solar industry, which had been paralyzed by a Commerce Department investigation into alleged tariff dodging by Chinese cell- and panel-makers.
  • But in December, Commerce issued a preliminary finding that the Chinese manufacturers were, in fact, dodging tariffs. In response, a bipartisan group of lawmakers introduced a resolution to overturn Biden’s pause, saying China needed to be punished for circumventing U.S. trade law.
  • The measure was introduced using the Congressional Review Act, which allows lawmakers to nullify the administration’s decisions with a simple majority vote within 60 legislative days. 

Many lobbyists and analysts expect the measure to garner the 60 votes needed for most other legislation to pass the Senate — requiring 11 Democrats to support it.

While Biden has vowed to veto the resolution if it reaches his desk, the solar industry and its allies fear that supporters could reintroduce the proposal as an amendment to must-pass legislation.

“I’m worried that if you give them 60 [votes] in the Senate, Republicans will keep coming back for more bites at the apple,” said a House Democratic aide who spoke on the condition of anonymity because they were not authorized to comment publicly. “They’re going to find every possible way to make us take hard votes on that.”

Democratic defections

The resolution — which could pass the House as soon as today — has put some Democrats in the awkward position of defying the president.

  • Sen. Robert P. Casey Jr. (D-Pa.), who represents a battleground state where Biden won by 80,555 votes in 2020, said in an interview that he would vote for the resolution because “China’s got to be held accountable.”
  • Sen. Sherrod Brown (D-Ohio) — another red-state Democrat who is up for reelection in 2024 — said Wednesday he would vote to restore the tariffs. “The Chinese government will do anything to undermine American manufacturing, and would like nothing more than to kill the American solar manufacturing industry before it takes off,” Brown said in a statement.
  • Senate Finance Committee Chair Ron Wyden (D-Ore.), one of the most protectionist senators, told reporters he would also vote for the proposal to support “red, white and blue manufacturing jobs.”

And Sen. Joe Manchin III (D-W.Va.), who chairs the Energy and Natural Resources Committee, said he was fed up with U.S. reliance on China for its energy transition. “I cannot fathom why the Administration and Congress would consider extending that reliance any longer and am proud to join this CRA to rescind the rule,” he said in a statement. 

The consequences

If tariffs were reimposed, leaders in the U.S. solar industry say the impact on jobs and climate targets would be devastating.

  • The Commerce investigation carries the threat of retroactive tariffs. That means if the two-year pause is lifted, U.S. solar developers could be forced to pay $1 billion in retroactive fees, according to the Solar Energy Industries Association
  • The resulting uncertainty in the industry would eliminate 30,000 well-paying jobs and $4.2 billion in domestic investment, the group has estimated, while 4 gigawatts of solar projects would be canceled, increasing planet-warming carbon emissions by 42 million metric tons.

“I would have to lay off thousands of people,” said George Hershman, CEO of SOLV Energy, a San Diego-based developer of large solar projects around the nation. 

“When you are talking about jobs that cost $300 million to $400 million, you can’t stop and start them easily,” he added. “I don’t know why anyone would support this.”

You can read our full story about the solar tariffs measure — and its broader implications for the energy transition — here.

On the Hill
Exclusive: Reps. Casten, Levin unveil permitting proposal

Reps. Sean Casten (D-Ill.) and Mike Levin (D-Calif.) today will unveil a discussion draft of legislation aimed at accelerating the permitting process for clean energy and transmission lines while ensuring community input, according to a copy of the proposal shared first with The Climate 202.

The lawmakers, who co-chair the House Sustainable Energy and Environment Coalition’s task force on clean-energy deployment, say they’re hoping to juice permitting negotiations after Democratic leaders tried unsuccessfully to pass a permitting bill from Sen. Joe Manchin III (D-W.Va.) last year.

“We were very frustrated that the only vehicle that was being discussed for permitting reform was the Senate Manchin package, which frankly has got a lot of completely unnecessary oil and gas provisions,” Casten told The Climate 202. “There has never been a proper package with the right policies.”

The Clean Electricity and Transmission Acceleration Act differs significantly from Manchin’s measure as well as the permitting provisions in House Republicans’ energy package, which passed the chamber last month and primarily focused on boosting fossil fuel projects.

The legislation would accomplish the following goals, according to a section-by-section summary from Casten’s office:

  • Give the Federal Energy Regulatory Commission siting authority for national interest transmission lines, or those that cross at least two states and have a capacity greater than 1,000 megawatts.
  • Establish an Office of Electricity Transmission at the commission.
  • Authorize $2.1 billion to address the shortage of electricity transformers through the Defense Production Act.
  • Require federal agencies to hold multiple hearings in environmental justice communities on proposals that affect them.

Casten expressed confidence that these proposals could garner broad support within the Democratic conference, although he acknowledged that most Republicans would probably reject them in favor of the GOP energy package.

“We’ll see what happens on the politics,” he said. “But you’ve got to define what your policy goals are.”

Senate votes to overturn Biden truck pollution rule

The Senate on Wednesday voted 50-49 to advance a GOP-led effort to revoke the Environmental Protection Agency’s new rule aimed at slashing tailpipe pollution from heavy-duty trucks, Rachel Frazin reports for the Hill.

Sen. Joe Manchin III (D-W.Va.) was the only Democrat to vote with Republicans on the Congressional Review Act resolution. 

Proponents of the rule argue that curbing nitrogen oxide pollution from trucks can help protect public health and prevent childhood asthma cases. But critics say it would increase burdens on the trucking industry and worsen inflation. 

Despite the resolution’s approval, President Biden said Wednesday he would veto it if it landed on his desk. And the effort is unlikely to receive enough Democratic support to gain the two-thirds majority needed to override a veto.

House passes GOP debt ceiling bill

House Republicans on Wednesday approved a bill that would raise the debt ceiling, slash federal spending and repeal some of President Biden’s programs to combat climate change, The Washington Post’s Tony RommMarianna Sotomayor and Leigh Ann Caldwell report. 

The 217-215 vote escalated a high-stakes feud with the White House, with as few as six weeks left before the government could default. The bill would roll back many of the clean-energy tax credits created by the Inflation Reduction Act, including those for electric vehicles and wind and solar energy. 

Rep. Nancy Mace (R-S.C.) — who on Tuesday threatened to vote against the bill because of concerns about scrapping clean-energy subsidies — ultimately supported the measure. Midwestern Republicans also backed the bill after GOP leadership agreed late Tuesday to restore tax credits for corn-based ethanol and other biofuels.

The only four Republican defections were Reps. Matt Gaetz (Fla.), Tim Burchett (Tenn.), Ken Buck (Colo.) and Andy Biggs (Ariz.), all members of the far-right House Freedom Caucus.

Senate environment panel advances Biden nominees

The Senate Environment and Public Works Committee on Wednesday voted along party lines to advance the nominations of two of President Biden’s top picks for key Environmental Protection Agency roles, months after deadlocking on both. 

By a vote of 10-9, the panel approved the nomination of Joseph Goffman to helm the agency’s Office of Air and Radiation, which he has led on an acting basis since January 2021. The panel deadlocked 10-10 on the nomination in November, with Republicans criticizing Goffman’s role in writing the Obama-era Clean Power Plan that aimed to significantly cut planet-warming pollution from power plants.

Lawmakers also approved the nomination of David Uhlmann, Biden’s pick for the EPA’s Office of Enforcement and Compliance Assurance, by voice vote. The office holds companies accountable when they violate the nation’s environmental laws.

In addition, the committee on Wednesday approved bipartisan legislation to improve the nation’s recycling and composting systems. The Recycling and Composting Accountability Act is co-sponsored by Chair Thomas R. Carper (D-Del.), ranking member Shelley Moore Capito (R-W.Va.) and Sen. John Boozman (R-Ark.). 

In the atmosphere

Thanks for reading!


By:  Analysis by Maxine Joselow with research by Vanessa Montalbano
Source: The Washington Post