In an energy sector dominated for more than a century by polluters, the relatively small solar-power industry has been the good guy. Now it has a darker side.
To be clear, using silicone cells to trap the sun’s rays and turn them into fuel is still better for the climate than burning fossil fuels. But this simple point is complicated by China’s efforts to dominate the market for the polysilicon used to make those cells.
A new report from a geopolitical consulting firm called Horizon Advisory has found signs that major Chinese polysilicon manufacturers are using forced labor from the Uighur Muslim minority in Xinjiang Province. According to a New York Times article about the report, the Chinese government denies the use of forced labor, which is not surprising since this government also denies the very existence of forced labor in China.
Nonetheless, the report adds to growing concerns over the issue. Over the summer, the State Department released a report that highlighted the risks of forced labor in supply chains that run through Xinjiang or other Chinese factories. In September, the House passed legislation that sought to block the import of any goods produced with forced labor in Xinjiang. And in October, the Solar Energy Industries Association said it would not tolerate suppliers that relied on forced labor from Xinjiang. (The association said it found last week’s Times report “deeply troubling.”)
That’s all promising. The problem is that almost all polysilicon in the world today is produced in China. And most industry analysts believe that half of all Chinese polysilicon is produced in Xinjiang province.
According to John Smirnow, a vice president and general counsel at the Solar Energy Industries Association, a decade ago the US sought to protect the US solar industry by closing a loophole whereby Chinese manufacturers used Taiwanese cells in their finished solar panels. China retaliated by closing its market to US-produced polysilicon. The result was that the US industry was hobbled.
“Over the past decade China has made considerable investment in its solar manufacturers,” Smirnow said. “US polysilicon companies have been the victim of the US-China trade conflict and have unfairly been blocked from selling polysilicon to China.”
During the presidential campaign, President-elect Joe Biden promised to unveil a $2 trillion initiative to create a new clean energy economy. A portion of that money will be for federal subsidies to purchase solar panels. Will Biden ignore the supply-chain risk posed by China on solar energy, or will he also invest in reviving US companies that dominated the polysilicon market before the 2010s?
One group that has an interest in this question will be a new lobbying association calling itself the American Clean Power Association. Its CEO, Heather Zichal, worked as legislative director for then-Senator John Kerry, who will be Biden’s new climate czar. The new association is made up of some of the world’s largest energy companies, including the world’s largest solar wafer manufacturer, the Chinese firm LONGi. Another board member is NextEra Energy, which has purchased solar panels from JinkoSolar, which has subsidiaries in Xinjiang Province.
Zichal declined to be interviewed for this column. But the association provided a statement that noted its support for the Biden administration’s “recognition that both strong domestic deployment of clean energy resources and international collaboration are essential for the US and the world to achieve the carbon reduction levels necessary to combat climate change.” Notably, the statement also included this sentence: “American Clean Power is fundamentally opposed to forced labor practices and our members are committed to ethical operations.” The statement made no mention of China.
Biden’s administration will soon have to explain how it plans to go green without enriching what are widely viewed as the instruments of Uighur repression. And even if no polysilicon was made with forced labor in China, it’s still dangerous for the US to be reliant on an adversary for a cleaner energy grid.
The question is not so much whether the US should subsidize more purchases of solar panels for public and private use. It’s whether the US government can also help revive American polysilicon manufacturers and encourage allies to find alternatives to China’s solar-industry supply chain. If it does the former without the latter, it will be helping to solve a climate problem by exacerbating a human rights crisis.
(Bloomberg)
