Solar industry stocks jump as Biden announces tariff suspension
Solar companies and their investors hailed the Biden administration's move to jolt the U.S. solar industry with a new order that both temporarily removes tariffs on imports and bolsters domestic manufacturers.
Why it matters: Solar installations were expected to fall by 7% in 2022, according to S&P Global Market Intelligence, as the industry faced supply concerns triggered by the prospect of retroactive penalties applied to previously imported products.
- The Commerce Department announced in late March that it was investigating whether Chinese solar manufacturers improperly circumvented duties by subsidizing production in several southeast Asia countries.
- Solar imports plunged, though they remained well above 2018 levels, when imports plummeted due to President Trump's imposition of a 30% tariff.
The impact: Biden's two-year suspension is breathing new life into U.S. solar companies, driving stocks up Monday. Installers are growing more optimistic that they'll be able to meet demand, while manufacturers hailed the administration's activation of the Defense Production Act to boost domestic output.
- The MAC Global Solar Energy Index was up more than 4% early Monday afternoon, as solar stocks such as SunRun, Sunnova Energy, Enphase Energy and Solaredge Technologies jumped.
- "During the two-year tariff suspension window, the U.S. solar industry can return to rapid deployment while the Defense Production Act helps grow American solar manufacturing," Abigail Ross Hopper, CEO of the Solar Energy Industries Association (SEIA), said in a statement, adding that the Commerce probe was "crushing" the industry.
Yes, but: The industry still faces the possibility of tariff resumption in two years.
- "It gives us a stay of execution, at least for the next two years," Erica Brinker, chief commercial officer of module-maker Array Technologies, tells Alan Neuhauser of Axios: Pro Climate Deals.