US electricity utility NextEra Energy warns of approximately 2.1 GW to 2.8 GW of its solar and storage projects scheduled for installation in 2022 to be shifted to 2023 due to lack of sufficient solar panel supply, till the US Department of Commerce makes a preliminary determination in its circumvention investigation.
During 2021-2022, it signed contracts for 11.55 GW of wind, solar, energy storage and wind repowering capacity, of which the share of solar was 3.927 GW and that of storage 1.655 GW. The project build push back is feared out of this capacity.
Sharing the company's Q1/2022 financial results on April 21, 2022, NextEra's Executive Vice President and CFO Kirk Crews said that several suppliers are not expected to ship panels to the US until the department submits a preliminary determination which is expected till late August 2022 and owing to that the company expects this capacity to be adversely impacted.
He also said that US solar panel assemblers are for the most part sold out through 2024 and may not be able to support the thriving domestic solar panel demand. This will also be because they rely on imported cells from Southeast Asia for their US produced panels.
"And all of the uncertainty from the investigation is occurring at a time when natural gas, coal and oil prices have increased dramatically, leaving solar and storage as one of the few ways to alleviate inflationary pressures on electricity prices," added Crews.
In the event of the department confirming tariffs on the 4 nations, Crews further stated, "We believe such a decision would create significant price uncertainty as additional tariffs on panels from the four Southeast Asian countries would likely remain unknown until close to 2025, as final tariff amounts are not determined for about 2 years after the year of importation. This price uncertainty would likely result in the unintended consequence of U.S. solar panel supply once again being sourced significantly from China, because the tariffs applicable to imports from China are more certain based on 10 years of assessed duty history."
While the company said it is comfortable with its current plan to build roughly 23 GW to 30 GW wind, solar and storage between 2021 till 2024 relying on its competitive advantages and supplier relationships, it did hope the Commerce Department's investigation will end with the decision to not impose additional anti-dumping and countervailing duties on cells and panels sourced from the Southeast Asian nations.
Recently, the Solar Energy Industries Association (SEIA) had released the preliminary results of a survey it is conducting to assess the impact the department's investigation against solar imports from Vietnam, Cambodia, Malaysia and Thailand at the behest of Auxin Solar. As per the association, the majority of the 200 respondents said panel deliveries have either been cancelled or delayed (see SEIA's Auxin Solar Survey Preliminary Results).
US solar tracker supplier Array Technologies also expects project delays owing to module uncertainty in the US (see Array Technologies' 2021 Annual Results).