Enphase seeks Section 201 exclusion for AC modules

Enphase Energy has registered as a lobbyist with a K Street law firm that specializes in WTO topics – Sidley Austin LLP. The firms website states, ‘members of Sidley’s WTO team have been involved in almost half of (the 400 WTO trade) disputes – more than any other law firm.’

Big guns out.

Currently, any pv modules with the Enphase microinverter attached at a factory outside of the U.S. has the Section 201 30% import tariff applied to the total value of the pv module, including the value of the inverter.

In the federal filing, the purpose of the lobbying is explicitly stated:

Enphase laid their strategy clear in the 4th Quarter earnings calls (which by the way showed off a very successful 4th quarter). At minute 41 of the call Raghu Belur responded to a question on Section 201,

The 201 ad valorem has inadvertently affected the AC Module, but if you think what the intent of the 201 was, it was limited to cells and modules, and inverters should be outside of the scope. Clearly it was not the intent.

Back in the days of integrated memory devices they had a similar issue and they established a process for separating out the two values to tax the separate pieces appropriately.

Belur also suggested they could, as a backup plan, detach the inverter from the solar panel before importing the product and paying the tariff, then at a U.S. factory attach the hardware. This would increase the cost over a standard home factory installed unit, but would be a lower total cost than the 30% tariff.

The company expressed confidence is being able to receive an exclusion due to precedents set – for instance the memory devices case mentioned above.

Enphase had the required documents needed to file for the exclusion, and said they had 60 days to file – but expected to complete the documents and submit within 30 days.