In December 2022, the US Department of Commerce published its preliminary determination that certain manufacturers of solar energy products in Cambodia, Malaysia, Thailand and Vietnam that rely on Chinese-origin inputs are circumventing US antidumping and countervailing duties relating to photovoltaic cells and modules of Chinese origin. If the preliminary determination is affirmed, manufacturers utilizing Chinese-origin components may be forced to reevaluate their supply chains.
Allan Marks, a partner in Milbank LLP’s Global Project, Energy and Infrastructure Finance Group, spoke with SparkSpread about how the investigation, which was initiated at the request of Auxin Solar, a US-based manufacturer, could affect the industry. In “Renewables Pros See Latest Commerce Hurdle as Manageable,” Mr. Marks notes that the severity of disruptions to the US solar sector from the Department of Commerce’s ongoing investigation could turn on the Biden Administration’s willingness to extend the moratorium, if needed.
“When the investigation was launched,” said Mr. Marks, “the resulting uncertainty around tariff applicability and imported component costs led many solar power projects to be delayed or suspended. Uncertainty around the adverse impact of tariffs on solar power development may well come back with a vengeance if the temporary freeze on the application of the tariffs is not extended or the investigation is not quickly resolved.” He added that not all in the industry are sanguine regarding the determination’s impact, and that the potential for tariffs could have significant negative implications and drive-up costs for new solar projects.
SparkSpread is part of the Inframation Group, an analytical platform for infrastructure investment professionals that helps identify M&A and refinancing opportunities, compare debt structures and analyze new markets.
Read “Renewables Pros See Latest Commerce Hurdle as Manageable.”
