The Department of Justice has pulled its support for the executive order that enabled solar components from Cambodia, Malaysia, Thailand, and Vietnam to enter the country duty-free.
Total duty exposure for the industry is estimated to be between $50 billion and $70 billion for the approximately 88 GW of solar capacity imported during the moratorium period, according to the Coalition for a Prosperous America.
By filing a motion to dismiss its appeal of a lower court ruling, the government is effectively stepping away from the “bridge” policy it created to keep the solar market moving during a period of extreme supply chain volatility. The move follows a court decision that the administration lacked the authority to waive these trade penalties, a ruling that has now left the industry exposed to significant financial risk.
With the government no longer defending the policy, the legal and financial burden has shifted entirely to the private sector.
Organizations like the Solar Energy Industries Association and the American Clean Power Association are now the primary defenders in a battle to prevent the retroactive collection of anti-circumvention duties. Major industry players, including NextEra Energy, Invenergy, and several top-tier manufacturers like JinkoSolar and Canadian Solar, must now carry the appeal forward on their own.
If the industry fails to overturn the original ruling, developers could be hit with massive bills for imports that arrived during the two-year moratorium.
Retroactive duties are calculated based on the following equation:
Total duty = (AD rate + CVD rate) x Declared import value
The declared import value is based on the cost of goods as reported to Customs and Border Protection at the time of entry. The Coalition for a Prosperous America estimates that average declared import values were about $0.14 per watt for cells and $0.27 per watt for modules during the import moratorium.
The potential for retroactive duties represents a massive liability for the domestic solar market. For projects that were financed and built based on the assumption of duty-free modules, an unexpected tariff bill of up to 200% could erase profit margins and threaten the viability of existing installations.
The industry now has a limited window to file its opening legal arguments and convince the court that the moratorium was a valid and necessary response to a national energy emergency.
The decision to drop the appeal reflects a tightening trade environment in Washington. While the moratorium was originally intended to prevent a collapse in solar deployments, the political focus has shifted toward protecting domestic manufacturing interests. As the legal battle continues, the industry is forced to defend against a trade policy that the government is no longer backing.
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