Subscribe today to the Washington Examiner magazine and get Washington Briefing: politics and policy stories that will keep you up to date with what’s going on in Washington. SUBSCRIBE NOW: Just $1.00 an issue!
BUILDING BRIDGES — AND BURNING OTHERS: U.S. solar manufacturers are incensed at the Biden administration for preparing a two-year “bridge” to protect imported solar products from new tariffs while domestic manufacturing ramps up.
The White House announced the tariff reprieve this morning, along with President Joe Biden’s decision to invoke the Defense Production Act to enable manufacturing of more photovoltaic modules, heat pumps, and equipment for building electrolyzers and fuel cells, among other technologies.
The tariff bridge, which Biden will order using emergency authority, is meant “to ensure that we have the reliable supply of components that deployers need to construct, grid-strengthening clean energy projects,” a senior administration official told reporters on a call this morning.
Manufacturers, however, criticized the move, suggesting the administration acted illegally and arguing it is effectively abetting Chinese companies in violating U.S. trade law by dumping solar cell and module products.
Solar beef: Biden’s actions try to serve the interests of both domestic manufacturers and import-reliant solar developers, who have been pulling the Biden administration in opposite directions over the Commerce Department’s anti-circumvention inquiry.
To recap, manufacturers want the department to impose tariffs on cell and module imports from Cambodia, Thailand, Vietnam, and Malaysia, arguing that Chinese companies are sending them through factories in those countries to avoid existing duties on Chinese imports.
Solar project developers argue the investigation is disrupting business, and Biden’s green energy agenda, and want to see the probe end swiftly with no new tariffs.
The administration official declined this morning to comment specifically on what to expect from the department’s investigation (and indeed was careful not to mention the word “Commerce” or “investigation” until asked to address it) while also saying the administration is focused on ensuring that trade laws are enforced.
Separately, Commerce Secretary Gina Raimondo has been insistent that the department is required by statute to carry out the investigation rather than commit to intervening to speed up the process, as solar trade groups and a number of Democratic lawmakers have requested the administration to do.
Auxin Solar, the California-based solar module manufacturer whose anti-dumping/countervailing duties petition triggered Commerce’s probe, accused Biden of “significantly interfering in Commerce’s quasi-judicial process” with this morning’s announcement.
“By taking this unprecedented – and potentially illegal – action, he has opened the door wide for Chinese-funded special interests to defeat the fair application of U.S. trade law,” the company said.
Samantha Sloan, vice president of policy for leading U.S. module manufacturer First Solar, said what Biden is doing “directly undermines American solar manufacturing by giving unfettered access to China’s state-subsidized solar companies for the next two years.”
“All of the U.S. manufacturers are pissed at this,” Nick Iacovella, senior vice president of public affairs for the Coalition for a Prosperous America, told Jeremy. CPA represents U.S. producers and manufacturers and supports Commerce’s investigation.
“What they’re saying in this announcement is, even if Commerce rules that the Chinese, what they’re doing is illegal, that they are illegally circumventing the AD/CVD duties, they’re going to give them a free pass,” he said.
The DPA: Iacovella called Biden’s use of the DPA a “silver lining.”
At the same time, Sloan referred to it as a “band-aid” and called it an “ineffective use of taxpayer dollars and falls well short of a durable solar industrial policy.”
Others were pleased: Several groups, including the Solar Energy Industries Association, American Clean Power Association, and American Council on Renewable Energy, felt served by the White House’s actions.
Gregory Wetstone, president and CEO of the American Council on Renewable Energy, said it gives the industry “a reprieve from the destructive impacts of the Commerce inquiry.”
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Jeremy Beaman (@jeremywbeaman) and Breanne Deppisch (@breanne_dep). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
SAUDI ARABIA HIKES PRICE OF JULY CRUDE: Saudi Arabia hiked July crude prices for Asian buyers to higher-than-expected levels, far outpacing most market forecasts and taking many traders by surprise as the kingdom sought to respond to concerns of high demand and an ongoing supply squeeze.
Saudi state-owned oil producer Saudi Aramco ultimately raised its July selling prices by $2.10 a barrel, rising to $6.50 a barrel over the benchmark it uses, Reuters reports. The hike exceeded most market forecasts, which had predicted an increase of roughly $1.50 per barrel.
News of the increase also touched off a rise in oil futures, which climbed as high as $120 per barrel today before settling a bit lower.
News of the increase comes days after Biden announced he will travel to Saudi Arabia this summer to meet with Crown Prince Mohammed bin Salman, underscoring the extent to which oil concerns have become a major priority for the administration.
And since Biden would almost certainly face harsh political blowback for striking deals with Iran or Venezuela—the two other oil-producing countries that could help the U.S. ramp up production—calling on the kingdom to drill more may be Biden’s best decision in the short-term. “A president has to try,” former Clinton-era energy secretary Bill Richardson told the New York Times. “Unfortunately, there are only bad options. And any alternative options are probably worse than asking the Saudis to increase production.”
FRANCE IN TALKS WITH UAE TO SECURE OIL: French Finance Minister Bruno Le Maire said his country is in talks with the UAE as a source to potentially replace Russian oil and diesel supplies, a shift that comes as EU countries seek to secure alternative sources just days after the bloc passed a phased-in ban on Russian crude.
UAE supplies could provide a “temporary solution,” Le Maire said yesterday in a local radio interview. The war in Ukraine, he added, is “accentuating a much deeper phenomenon,” and one that underscores the belief that becoming energy independent is the best move.
UN NUCLEAR WATCHDOG CHIEF CITES ‘GRAVE CONCERN’ OVER CONDITIONS AT RUSSIAN-CONTROLLED POWER PLANT: International Atomic Energy Agency Director-General Rafael Mariano Grossi said he is deeply concerned about the status of the Russian-controlled Zaporizhzhia nuclear power plant in Ukraine, citing conditions that he described as posing a “clear and present risk to safety, security and safeguards” at the facility, which is the largest nuclear plant in all of Europe.
Speaking today at the IAEA’s Board of Governors meeting, Grossi said he is working to deploy an international team of experts to visit the site and assess the situation on the ground, after plant operators failed to submit data on their nuclear material to the IAEA for review. Grossi also cited rising concern from Ukrainian regulators about its ability to send spare parts to Zaporizhzhia, if needed—which he said undermines one of the seven “indispensable” pillars of nuclear safety and security.
In total, Grossi said, “five of the seven indispensable pillars of nuclear safety and security have been compromised” at Zaporizhzhia.
The situation “has not only raised serious and pressing humanitarian concerns, but is also a clear and present risk to the safety, security and safeguards at the nuclear power plant,” Grossi said. Read more from Breanne here.
LEADERS CONVERGE IN BONN AHEAD OF UN CLIMATE SUMMIT: Leaders from around the world gathered today Bonn, Germany, for the start of a 10-day meeting to help lay a foundation for the upcoming United Nations climate summit in Egypt this fall. Leaders will take stock of their own efforts and progress they’ve made since last year’s UN climate summit in Glasgow—which saw 200 nations pledge to take steps to more urgently deliver on goals set in the 2015 Paris climate accord.
But the talks come as geopolitical instability, in particular Russia’s war in Ukraine, have forced many countries to rethink their approach to energy security, at least in the short-term. And with just five months to go until the start of the UN climate summit, few nations have offered plans to strengthen their climate pledges or to cut the length of time to do so.
Speaking at the outset of the Bonn meeting, UN climate chief Patricia Espinosa urged leaders not to give in to “despair” on global warming. “I appeal to all of you, especially in these difficult and challenging times, not to lose hope, not to lose focus, but to use our united efforts against climate change as the ultimate act of unity between nations,” Espinosa said.
“We must understand that climate change is moving exponentially. We can no longer afford to make just incremental progress,” she added.
REACTION TO EPA’S RECORD RFS BLENDING VOLUMES: The EPA’s announcement on Friday, which locked the refining industry into a record year for biofuel blending while also retroactively setting blending obligations for 2020 and 2021 to equal the volumes actually blended, was well-received by renewable fuel trade groups.
“We take this as EPA’s position that biofuels continue to play a critical role in mitigating climate change and, most importantly, today in lowering prices at the pump for drivers across America,” Joe Kakesh, general counsel for renewable fuels industry group Growth Energy, told Jeremy.
Kakesh declined to consider the announcement a “qualified” victory. Growth Energy had discouraged EPA against retroactively lowering volumes.
Republican Sen. Deb Fischer of Nebraska, the nation’s no. 2 corn producer, however, criticized the administration’s “contradictory approach” for lowering volume obligations retroactively.
Refiners’ take: Fuel refiners and the broader oil industry criticized the finalized 2022 volumes in particular, which American Fuel & Petrochemical Manufacturers called “bewildering,” arguing it will increase costs to their members and thus to consumers.
Washington Post Army Corps blocks strip mine near Okefenokee wetlands after opposition
Bloomberg China’s renewable energy fleet is growing too fast for its grid
Financial Times US Treasury takes aim at World Bank over climate change inaction
Associated Press NY girding for shark season with more drones, vigilance
TUESDAY | JUNE 7
10:00 a.m. SVC-217 The Senate Relations Committee will hold a closed briefing on the World Threat Assessment.
10:00 a.m. 562 Dirksen The Senate Agriculture, Nutrition and Forestry Subcommittee on Conservation, Climate, Forestry and Natural Resources will meet for the first time since 2013 for a hearing to discuss the persistent drought in the West and discuss ways to establish resilience.
WEDNESDAY | JUNE 8
10:00 a.m. 406 Dirksen The Senate Environment and Public Works Committee will consider the nominations of Annie Caputo and Bradley R. Crowell to be members of the Nuclear Regulatory Commission.
10:00 a.m. 2318 Rayburn The House Science, Space, and Technology Committee will hold a hearing on detecting and quantifying methane emissions from the oil and gas sector.