President Joe Biden’s recently announced $7 billion Earth Day scheme to distribute federal grants for residential solar projects across the US has garnered criticism, with experts warning that it could funnel money to China and undermine domestic manufacturing efforts.
The initiative aims to support roughly 900,000 low and middle-income households, as well as community gardens, in installing solar panels. However, critics have expressed concerns that it contradicts the Inflation Reduction Act, which was passed in 2022 and seeks to stimulate US manufacturing in clean energy industries.
Jeff Ferry, an economist at the Coalition for a Prosperous America, cautions that a substantial portion of the $7 billion could flow to Chinese manufacturers, potentially jeopardizing the entire project. He emphasizes the need for stricter import restrictions on solar panels, which are currently predominantly sourced from Chinese companies based in Southeast Asia.
Despite encouraging the use of US-made products, the cost difference between American and Chinese-made solar panels is significant. Chinese panels are approximately 60% cheaper, and China currently accounts for 80% of global solar panel production.
Republicans have previously criticized Biden’s reliance on Chinese solar panels, with Dave McCormick, a Republican senate candidate for Pennsylvania, claiming that the administration has increased US dependency on solar panels and lithium batteries from China.
