Trump may end tariff exemption for imported solar panels, judge rules

NEW YORK, Nov 19 (Reuters) - A U.S. judge overseeing trade issues on Thursday upheld a recent proclamation by President Donald Trump to allow the reimposition of tariffs on some imported solar panels, in a victory for domestic manufacturers.

Judge Gary Katzmann of the U.S. Court of International Trade said Trump’s decision to revoke a tariff exemption for double-sided, or bifacial, solar panels did not run afoul of an earlier court order that left the exemption in place.

The judge said Trump acted under a different law than what governed U.S. Trade Representative Robert Lighthizer, to whom the earlier order was directed.

Bifacial technology is a small but growing part of the solar panel market, costing more but capable of producing greater power than traditional panels.

Trump said in his Oct. 10 proclamation that the exemption “impaired and is likely to continue to impair the effectiveness” of tariffs meant to bolster the domestic solar industry “in light of the increased imports of competing products.”

Shares of U.S. solar panel manufacturers rose after the decision. In afternoon trading, First Solar Inc was up 3.3%, while SunPower Corp was up 3.9%.

Katzmann’s decision is a defeat for companies that build solar farms, including Chicago-based plaintiff Invenergy Renewables LLC.

A trade group, the Solar Energy Industries Association, also favored the exemption, saying higher tariffs could wipe out a few billion dollars of domestic investment a year.

The decision’s impact may be temporary, because Katzmann said the plaintiffs may file new lawsuits directly challenging Trump’s proclamation.

John Smirnow, the trade group’s general counsel, said it may sue over the proclamation.

“The bifacial exclusion has already saved consumers hundreds of millions of dollars and many thousands of American jobs,” he said. “It should be preserved.”

The United States imposed duties on solar panel imports starting at 30% in 2018 and now expected to drop to 18% by 2021.

It unexpectedly exempted bifacial panels in June 2019 but began trying to withdraw the exemption four months later.

The case is Invenergy Renewables LLC v U.S. et al, U.S. Court of International Trade, No. 19-00192. (Reporting by Jonathan Stempel in New York; Editing by Steve Orlofsky)