Big Winner Of Section 201 Solar Case Is SunPower

One of the largest solar companies, SunPower, which has been paying up to $2 million in tariffs per week, can breathe a sigh of relief.

The U.S. Trade Representative on Tuesday filed a long-awaited document in the Federal Register detailing cuts for Section 201 solar trade case tariffs. The prohibitions, which are not retroactive, will be formally published on Wednesday.

The exclusions encompass cells and modules with a kind of specific characteristics including back contact solar cells, frameless solar panels that are not blue or black, and off-grid 45-watt or fewer panels of a certain length. SunPower announced its interdigitated back contact solar cells and modules are dismissed.

SunPower said the elimination lets the company “turn the page” after the exclusions go into effect on September 19. According to the company, “for the past several months” it’s been funding $1.5 million to $2 million per week in tariffs while it waits for news on a possible exclusion.

Jade Jones, a senior solar analyst at Wood Mackenzie Power & Renewables, said the administration's dismissals look tailored to SunPower.

"It looks like it was composed for SunPower," stated Jones. "They are the only champion, and if you look at the list of companies that filed for exclusion, it's not like they were the only one attempting to seek exclusion," Jones replied that one of the exclusions covers building-integrated PV akin to Tesla's solar roof, but the company is already planning to manufacture that product in the U.S. at its Buffalo, New York factory.

SunPower stands out within the solar industry, which has collectively analyzed Section 201 more of a hiccup, as a company damaged by the administration’s plans.

The latest Solar Market Insight report from Wood Mackenzie Power & Renewables shows the initial negative results from tariffs have stabilized somewhat. While the U.S. utility-scale pipeline grew to a report 8.5 gigawatts over the first half of 2018, SunPower in its Q2 2018 earnings report estimated a net loss between $195 million and $215 million in the coming quarter.

Further On Solar News

In supplement to its weekly cash hemorrhage, SunPower suggested it has made significant business decisions based on the tariffs.

According to Natalie Wymer, SunPower’s vice president of global corporate communications, the company remained “optimistic” about its exclusion question up until the announcement “due to our reasons on why we should be excluded.” A business handout detailing why the company deserves an exclusion provides top billing to its investment in U.S. manufacturing.   

In April, SunPower declared it would acquire SolarWorld Americas, one of the petitioners in the Section 201 trade case. At the time, CEO Tom Werner said the movement would “align” SunPower with the current administration.

SunPower requires to close the deal in Q3 2018. Until Tuesday, it seemed the purchase had compelled limited action from the trade representative.

During the winter and spring, SunPower sought and scheduled several meetings with trade staff, according to emails and meeting invitations received by Greentech Media.

What About Connections?

Though connections between stakeholders and trade representatives are not themselves unusual, in the months following the tariff letter, staff schedules show meetings with companies including Canada Solar, JinkoSolar and Majestic Steel, the timing of SunPower’s requests further suggest that the company pursued the acquisition as a result of the Trump administration’s policies. JinkoSolar, Hanwha Q Cells and LG Electronics have also invested in U.S. manufacturing since the tariff announcement.

On April 6, a little over a week before SunPower would announce the acquisition, emails show Werner contacted Payne Griffin, the U.S. Trade Representative’s deputy chief of staff, requesting a meeting with Griffin and a colleague to discuss an “update on SunPower and U.S. manufacturing.” Documents show a meeting was scheduled for April 10.

At the same time, the Trump administration has pursued further tariffs. Just recently the administration announced its final decision on duties that encompass inverters, a further blow to the solar industry that could impact balance-of-system prices.

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