A federal investigation into whether China is getting around tariffs on solar panels has Colorado's expanding solar energy industry warning of layoffs, soaring prices and lights out for new projects.
In January, industry representatives and the U.S. Energy Information Administration were predicting 2022 would be a busy year for new solar power generation. Now, the Department of Commerce is looking into claims China is routing its panels through other countries to circumvent U.S. tariffs, which, if confirmed, could result in huge tariffs that might be retroactive to November 2021.
Four Southeast Asian countries being scrutinized account for more than 80% of the U.S. imports of solar panels, and tariffs on the products could ultimately jump by 50% to 250%. The situation threatens the U.S. solar industry and efforts in Colorado and nationally to cut greenhouse-gas emissions and boost the use of renewable energy, said Mike Kruger, president and chief executive officer of the trade group Colorado Solar and Storage Association.
"We're probably going to see job losses over the summer at a time when we shouldn't because customer demand continues to be through the roof," Kruger said.
The Commerce Department started an investigation April 1 into claims by Auxin Solar, a California solar panel manufacturer, that China is evading tariffs by funneling its products through Cambodia, Malaysia, Thailand and Vietnam. The tariffs imposed during the Obama administration are intended to prevent government-subsidized solar panels made in China from unfairly competing with U.S.-made panels.
A preliminary determination is expected in August.