On December 23, according to Caixin, (Editor Liu Rui) Although Biden has only a few weeks left in his term, the Biden administration seems to be continuing to push forward with new plans.

According to sources, senior officials in the Biden administration are considering exempting tariffs on solar equipment imported from Mexico, but no final decision has been made. This decision could benefit a Chinese-controlled photovoltaic company.

Will US photovoltaic tariffs change?

For a long time, the deployment of photovoltaic systems in the USA has heavily relied on inexpensive foreign-manufactured equipment. As a result, the US government has been working to cultivate a domestic clean energy manufacturing industry while not wanting to affect domestic photovoltaic deployment, making tariffs on photovoltaic modules a significant topic of controversy.

In early 2018, former President Trump imposed tariffs on imported crystalline silicon solar cells and modules. Later, this tariff was extended by Biden until February 6, 2026, with the tariff level for photovoltaic cells and modules set at 14% for most of next year.

Although the USA exempted photovoltaic products from Canada two years ago, it did not grant the same exemption to Mexico, as the US government believes that domestic solar manufacturers would be severely harmed by exports from Mexico.

The changes currently being considered by Biden would effectively reverse the current situation, potentially increasing solar products imported into the USA and giving an advantage to the leading photovoltaic module supplier in Mexico, Maxeon.

Data shows that the company's factory in Mexico can produce 2.5 gigawatts of components annually, accounting for about 93% of the country's total capacity. The majority of the company's equity is held by TCL Zhonghuan Renewable Energy Technology Co., Ltd. (002129.SZ) from China.

The company is considering focusing on the USA market.

Tariff exemptions may give Maxeon an advantage in the USA for panels produced in Mexico. However, this does not address the other challenges the company faces, including the sluggish USA solar market.

In November last year, the company announced a comprehensive restructuring plan focusing on the USA market and selling other businesses.

Maxeon stated its intention to establish a module assembly plant in Albuquerque, New Mexico, although the planned capacity has been reduced from the initially announced 3 gigawatts in August 2023.

The company currently indicates that a locally built factory with a capacity of 2 gigawatts is expected to begin production in early 2026, one year later than originally planned.

The project has already been welcomed by New Mexico Democrats, including Senator Martin Heinrich, who will become the Democratic leader of the House Committee on Energy and Natural Resources next year.

Could Trump's rise to power overturn everything?

However, even if Biden exempts tariffs on solar equipment manufactured in Mexico, the sustainability of this policy remains in doubt given the upcoming presidential transition in the USA.

The elected president of the USA, Trump, has already threatened to impose a 25% tariff on Canada and Mexico as soon as he takes office to combat illegal immigration and fentanyl trafficking.

Currently, some manufacturers in the USA that heavily rely on imported photovoltaic components have lobbied the government to increase the tax-free quota for photovoltaic components next year.

They stated that while expanding domestic Battery production capacity in the USA, imposing high tariffs would adversely affect American Battery panel manufacturers who rely on foreign supplies.

Editor/lambor