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Biden Administration Backs Trump Solar Tariffs at Trade Court

Biden Administration Backs Trump Solar Tariffs at Trade Court

In a recent lawsuit filed by several members of the solar industry, the Department of Justice stood behind former President Donald Trump’s stance on solar tariffs. The Biden administration is asking the Court of International Trade to toss a lawsuit by a solar trade group and domestic solar-farm developers that claims Trump-era tariffs on imported solar panels violate a trade statute.

According to articles published by Bloomberg, Reuters, and Greentech Media (GTM), Department of Justice attorneys on Monday sought to dismiss the lawsuit by the Solar Energy Industries Association (SEIA) and some of its members that claims Trump’s reimposition of tariffs on some imported solar panels violates the Trade Act of 1974. That proclamation placed tariffs on two-sided (bifacial) solar panels, which had been excluded from tariffs on imported cells and modules, and also increased the level of tariffs in their fourth and final year.

The climate-focused Biden Administration said Trump “acted lawfully and fully within his authority” when he killed a tariff exemption for the two-sided solar panels, marking a potential setback to clean-power developers.

The filing from the U.S. Department of Justice states that the solar industry complaint “fails to set forth a plausible showing that the President’s determination involves a clear misconstruction of the governing statute, a significant procedural violation or action outside delegated authority.”

The department also argued that Trump “acted lawfully and fully within his authority” to reinstate tariffs on bifacial solar “by closing a loophole that the President determined had been undermining the effectiveness of the safeguard measure on solar products.”

The government’s motion comes as the White House aims to boost renewable-power capacity in a bid to green the country’s electric grids by 2035. For some developers, the solar tariffs represent an impediment to that objective, adding to the costs of clean-energy projects.

Trump acted after receiving a U.S. International Trade Commission report that the loophole was affecting the domestic solar industry. Federal law allows the president to modify duties, and here he merely imposed ones that had been contemplated, the government said.

In early 2018, Trump approved four years of tariffs following a campaign promise to get tough on China (which dominates solar-panel manufacturing) and boost the U.S. industry. His administration later granted an exclusion for bifacial panels. While bifacial was considered a niche product at the time, the tariffs had encouraged some new U.S. solar manufacturing, and duty-free module imports posed a threat.

This month, the U.S. Trade Representative said the administration would review past trade policies, including those on solar.

“The DOJ filing could result in the case being terminated,” said Dave Glynn, an attorney at Holland & Hart. But that does not mean the administration “will not address the solar panel tariff issue in other ways,” according to GTM.

“The DOJ is making a legal conclusion,” Glynn said in an email, “but not opining on the benefits that may accrue by prohibiting the tariff increases and continuing the bifacial panel exclusion. Biden has publicly stated his support for renewables, so I expect he will approach this differently and by legally exercising his power to remove duties that hinder his long-term energy policy. He will also need to balance this with his goal to put more Americans to work, an argument advanced by the plaintiffs in this case.”

Tariffs on solar components are set to expire in 2022. While it’s unclear if Biden could end those tariffs earlier, it is speculated that his administration probably won’t extend them.

Estimates of employment in the U.S. clean energy sector range from about 700,000 to 3 million jobs. Biden pledged to create 10 million jobs.

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