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Clean energy industry and climate activists see glimmer of hope in new Biden action after months of ‘hard times’

The administration moved to waive anti-circumvention tariffs on solar panels for two years and invoking the Defense Production Act to speed up domestic manufacturing of solar panel components, energy-efficient heat pumps, building insulation and transformers needed for the electric power grid.

The run-up to the announcement took months of an intense pressure campaign from an embattled solar industry and bipartisan governors and lawmakers alike. It eventually reached the top levels of the White House, including White House chief of staff Ron Klain and counselor to the President Steve Ricchetti, according to two sources familiar with the discussions.

The source of the solar industry’s panic was a Commerce Department investigation into whether these four countries — Cambodia, Malaysia, Thailand and Vietnam — were skirting US trade laws, using components from China that should be subject to US tariffs. Because of potentially steep and retroactive tariffs that could be slapped on panels coming from these countries, the supply chain dried up quickly.

“The Commerce Department action — which is totally independent — created what we continued to hear was a crisis,” Energy Secretary Jennifer Granholm told CNN on Tuesday.

The administration tried to walk a fine line between protecting the Commerce Department investigation and stopping further job losses in the solar industry. The sources familiar said that a wide variety of offices and departments were engaged in the effort, including the National Economic Council, White House Climate Office and Office of Legal Counsel.

“I think what took everyone by surprise, including the White House, was how quickly the industry came to a screeching halt,” Abigail Ross Hopper, president of the Solar Energy Industries Association, told CNN. Data from SEIA showed 318 solar projects were delayed or cancelled in the last two months, which would have supported between 50,000-100,000 jobs.

Industry leaders and solar CEOs told CNN they were happy with the breadth of action taken by the administration, but some wished they had acted sooner.

“The industry is supportive that the administration acted quickly, but it still caused months of impact and delay,” George Hershman, CEO of utility solar contractor SOLV Energy, told CNN. “We have to recover from that; that’s going to take a little while.”

Granholm defended the administration’s actions, saying they acted quickly while preserving the Commerce Department tariff investigation.

“We’re glad that this has stopped the bleeding and will also set us on a path to have a robust manufacturing sector,” Granholm said. “I think we acted quickly, thoughtfully and responsibly, and acted to meet the moment.”

‘Basically Armageddon’ for the solar industry

New Mexico Sen. Martin Heinrich, a Democrat, was in the process of installing solar panels on his home this spring when he started getting calls from panicked solar company CEOs in his state.

“I was fielding calls left and right, about basically Armageddon,” Heinrich told CNN.

CEOs told him they suddenly couldn’t buy solar panels from foreign suppliers — four Southeast Asian countries supply the overwhelming number of US panels and parts. With little-to-no solar panels to buy, utility-scale solar companies couldn’t build massive new arrays or finish existing projects — and they were worried about having to lay off their workers.

“I was hearing that this was actually going to kill the solar industry,” Nevada Sen. Jacky Rosen, a Democrat, told CNN about the impacts in her home state.

While much of the solar industry felt the effect of the Commerce tariff probe almost immediately, it flew under the radar for a while, initially not getting much attention from the White House.

“It took a little bit longer to sink in than I had expected it would take,” one industry source familiar with the discussions said.

Hershman said Granholm was “supportive and understood the issues early on.” And clean energy trade associations communicated their concerns early to Biden’s White House National Climate Adviser Gina McCarthy and US Climate Envoy John Kerry. But the administration response sped up when top White House officials including Klain and Ricchetti got involved.

“When it got to the level of where Ron Klain and Steve Ricchetti fully understood the scale of the economics and the job implications, quickly the conversation turned at all levels to what would a constructive way out of this economic situation look like,” a source familiar with the discussions said.

Ultimately, Ross Hopper said arguments about job losses were particularly persuasive with the White House, but administration officials were also concerned about less solar being deployed, affecting the reliability of the electricity grid and energy security during Russia’s ongoing war on Ukraine.

A glimmer of hope for climate advocates

The White House’s announcements on Monday provided a shot of optimism for a climate movement that has felt dejected for months.

“It’s been about six months of hard times” for the climate movement, Leah Stokes, a senior policy advisor at Evergreen, told CNN. Monday marked a turning point, she added: “I think it’s a big climate win.”

Climate advocates and progressive Democratic lawmakers had been calling on the administration to invoke the Defense Production Act to manufacture heat pumps and other forms of clean energy for months. Those calls increased after Russia’s invasion of Ukraine, as a way to help Europe get off Russian energy without increasing reliance on fossil fuels.

But questions still remain on whether they can achieve their greatest prize: Democrats striking a climate deal with Sen. Joe Manchin of West Virginia.

Manchin and Senate Majority Leader Chuck Schumer have been negotiating on a party-line spending bill, and Manchin told CNN this week that there are still disagreements over the climate and clean energy provisions, including tax credits for solar and wind energy, as well as electric vehicles.

“The administration is having a hard time, and the climate people are having a hard time, coming to agreement on that,” Manchin told CNN.

While advocates say the administration has stopped the immediate crisis with its solar industry, it still has more work to do with Manchin.

CNN’s Manu Raju contributed to this report.

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