On June 6th, 2022 President Biden made three key decisions regarding the clean energy industry. These three actions will:
• Invoke the Defense Production Act to help boost domestic clean energy manufacturing
• Two-year suspension of tariffs on offshore solar components, and
• Give more tools to the federal procurement process to spur domestic manufacturing
1. First, the President invoked the Defense Production Act (DPA) to accelerate domestic production of clean energy technologies, including solar panel parts Specifically, the President is authorizing the Department of Energy to use the DPA to rapidly expand American manufacturing of five critical clean energy technologies:
• Solar panel parts like photovoltaic modules and module components;
• Building insulation;
• Heat pumps, which heat and cool buildings super efficiently;
• Equipment for making and using clean electricity-generated fuels, including electrolyzer, fuel cells, and related platinum group metals; and
• Critical power grid infrastructure like transformers.
The Administration will strongly encourage the use of strong labor standards, including project labor agreements and community benefits agreements that offer wages at or above the prevailing rate and include local hire provisions.
2. Second, the President has encouraged the private sector to investment more into the clean energy sector and by doing so the expansions to domestic solar manufacturing capacity announced since the President took office will grow the current 7.5 gigawatts of capacity by an additional 15 gigawatts of capacity, for a total of 22.5 gigawatts by the end of his first term.
With a sizable supply chain coming from Southeast Asia and the US market still beginning to ramp up, the president created a 24-month bridge for certain solar imports while reinforcing the integrity of our trade laws and processes.
Specifically, the President is:
• Temporarily facilitating U.S. solar deployers’ ability to source solar modules and cells from Cambodia, Malaysia, Thailand, and Vietnam by providing that those components can be imported free of certain duties for 24 months in order to ensure the U.S. has access to a sufficient supply of solar modules to meet electricity generation needs while domestic manufacturing scales up; and
• Reinforcing his commitment to safeguarding the integrity and independence of all ongoing trade investigations by career officials at the Department of Commerce and recognizing the vital role these processes play in strengthening our economy.
3. Third, the President is giving more authority of the federal procurement to work spurring additional domestic solar manufacturing capacity. Today, the President directed the development of two innovative tools to accelerate Made-in- America clean energy:
• Master Supply Agreements for domestically manufactured solar systems to increase the speed and efficiency with which domestic clean electricity providers can sell their products to the U.S. Government; and
• So-called “Super Preferences” to apply domestic content standards for federal procurement of solar systems, including domestically manufactured solar photovoltaic components, consistent with the Buy American Act.
These federal procurement measures can stimulate demand for up to a gigawatt of domestically produced solar modules in the near term, and up to 10 gigawatts over the next decade. The Administration will also partner with state and local governments and municipal utilities in these innovative arrangements – increasing the potential market impact over the next decade to as much as over 100 gigawatts.
These executive actions build upon what the Administration has done previously such as:
• The U.S. International Development Finance Corporation supports building resilient clean energy manufacturing supply chains in allied nations around the world, reducing global dependence on China.
• Administration is helping 17 local communities remove red tape with the SolarAPP+ online tool to enable same day approvals for residential solar installation permits, and an additional 400 interested communities are in the pipeline.
• a new five-agency collaboration is expediting reviews of clean energy projects on public lands through the Department of the Interior, helping us race ahead toward permitting at least 25 gigawatts by 2025.
• Renewable Energy Coordination Offices and reduced rents and fees by more than 50 percent for solar and wind projects on public lands.