U.S. Customs solar exclusions may be “de facto ban on Chinese polysilicon”

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Under enforcement of the Uyghur Forced Labor Prevention Act (UFLPA), U.S. Customs and Border patrol has reportedly excluded Longi solar modules made with Tongwei polysilicon from entering the market, reported ROTH Capital Partners in an industry note.

Further pv magazine USA industry checks show that modules made with Astronergy (Chint) polysilicon have been detained and are under review under UFLPA.

The UFLPA places the burden of proof on importers to show that the supply chain has no traces to forced labor practices. China has consistently denied allegations of forced labor of the Uyghur population in Western China, a Muslim minority group.

Prior to the exclusion of these goods, any imports sourced from the Xinjiang province of China, responsible for a little less than 50% of global production, would be barred from entry. However, it was unclear whether other Chinese suppliers outside the region would face similar scrutiny and market bans.

(Read: “A moral trilemma for U.S. solar procurement“)

The ban of Tongwei polysilicon-supplied Longi panels may mark a “de facto ban on Chinese polysilicon,” warned a pv magazine USA industry contact. Tongwei was the world’s largest polysilicon provider in 2022, producing over 345,000 MT, and has no presence in the Xinjiang province.

This is a dramatic negative development for the supply of solar panels in the United States as China produces “a share of 89% in the global output of solar-grade polysilicon in 2022, and expansion continues unabated,” according to Bernreuter Research.

Longi is expected to appeal the import exclusion, but the process for appeal may take several months, drying up module supply in the meantime.

To be in compliance with UFLPA, show that a product has no inputs from Xinjiang. To show this, companies must provide a comprehensive supply chain mapping.

While the U.S. moves to onshore its solar supply chain, doubts persist that the industry can move fast enough to manufacture a steady supply of components to build towards its clean energy goals. Wood Mackenzie expects the U.S. solar market to triple in size over the next five years, bringing total installed solar capacity to 378 GW by 2028.

Clean Energy Associates (CEA) shared that while module assembly has a strong presence today in the U.S., ingot, wafer, and cell production plans have not kept pace, and no plans for greenfield polysilicon plants have materialized.

CEA forecasts the U.S. to reach 17 GW of polysilicon production, 3 GW ingots, 3 GW wafers, 18 GW cell manufacturing, and 40 GW module manufacturing capacities by 2027, suggesting that the U.S. will continue to rely on energy imports for years to come. However, the recent UFLPA enforcement developments may pose a serious challenge to finding suppliers.

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