MANY MINDEDWashington is weighing a legal floor under the price of polysilicon
Reuters reports that the US Commerce Department has completed a year-long Section 232 national security investigation into polysilicon and is expected to announce a hybrid regime later this month, combining a minimum import price with tariffs on polysilicon and derivative products. Importers investing in domestic wafer and cell production would reportedly be able to offset the cost. Domestic producers Hemlock Semiconductor and Wacker Chemie are named as beneficiaries; solar developers and semiconductor buyers face higher input costs, and one panel maker's chief executive warned that inflated costs could cause projects to fall down. China's Washington embassy called for the measures to stop.
A minimum import price is worth distinguishing from a tariff, because it does something a tariff does not. A tariff raises the landed cost by a percentage and leaves the underlying price free to keep falling. A price floor sets a number below which the material may not legally be sold, which forecloses further decline by statute. Polysilicon is the first input in the solar supply chain, so a floor there propagates upward into wafers, cells and modules — the curve a floor would sit under is at manyminded.com/curve/solarModule.
This is the second card today about a government acting to stop solar getting cheaper — Kunming's capacity suspension is the other, from the opposite side of the trade dispute.
The reason this carries low weight despite a large potential effect is evidential. The story rests on four unnamed sources describing a decision that has not been made public. No rule, no numbers, no floor price. A White House official declined to comment and Commerce did not respond.
Source: Reuters