An industry note from Philip Shen, managing director, ROTH Capital Partners, said industry contacts have informed the firm that the first potentially meaningful supply of solar panels detained by Customs Border Patrol under the Uyghur Forced Labor Prevention Act (UFLPA) has been released to the U.S. market.
The note said JinkoSolar modules made with Wacker polysilicon were released. “We believe this could result in a ramp up of volume and imports. The company likely has a substantial amount of Hoshine WRO & UFLPA backlog to get through,” wrote Shen.
The UFLPA places a “rebuttable presumption” that goods from the Xinjiang region of China, home to roughly 50% of the global polysilicon supply chain, are made with forced labor. The act places the burden of proof on buyers to show that the imported goods have no connection to forced labor whatsoever.
To be in compliance with UFLPA, companies must provide a comprehensive supply chain mapping, a complete list of all workers at a facility, and proof that workers were not subject to conditions typical of forced labor practices and are there voluntarily.
Earlier this month, Reuters reported that over 1,000 shipments of solar energy components, valued in the hundreds of millions of dollars, have been blocked in U.S. ports under enforcement of UFLPA. ROTH said in August that as much as 3 GW had been held in Customs since the law was enacted. As much as 9 GW to 12 GW of solar modules could be prevented from entering U.S. markets by the end of the year, said Shen.
The module release is expected to have a meaningfully positive effect on the U.S. utility-scale solar sector, said ROTH.
The note warned that Customs Border Patrol may now turn its attention beyond the top solar component importers. “We could end up being in a two steps forward, one step back situation,” said ROTH.
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