IRA Domestic Content Guidance Hit

US steel producers and workers are warning that recent Administration guidance on rules for implementing the domestic content bonus credit requirements for solar and other renewable energy electricity generation projects under the Inflation Reduction Act could harm domestic producers by allowing the use of foreign steel.

In a letter to Treasury Secretary Janet Yellen, the groups noted that the Treasury Department’s guidance would allow firms to still qualify for the 10 percent tax credit even if imported steel is used.

“If the current Guidance were to be made final, it would significantly damage US domestic steel producers, putting at risk 1.5 million tons of production and jeopardizing the livelihoods of millions of Americans who depend on our industry,” according to the letter.

Investments at Risk

“It also puts at risk the hundreds of millions of dollars that companies are investing to support

domestic solar production,” it continues. “Additionally, if left unaddressed, it would severely undermine a key goal of the IRA: to require the structural steel components of new solar projects eligible for the domestic content bonus credit requirements to be manufactured with steel and iron that are produced entirely in the United States.”

The letter was signed by Zekelman Industries, Nucor Corporation, US Steel, Steel Dynamics Incorporated, North Star BlueScope Steel, United Steelworkers, the Committee on Pipe and Tube Imports and the Coalition for a Prosperous America.

The groups are calling for “immediate correction of an error in the Guidance that places the structural steel components of photovoltaic trackers, which are mounting structures, in the Manufactured Product category instead of the Steel and Iron category.”

“Categorization of tracking systems as manufactured products would permit many of the structural steel components countries desiring to target the U.S. market and U.S. jobs by dumping their excess steel capacity in the U.S., so long as the overall project met the 40 percent domestic content requirement.”

Fixing this error will ensure that the guidance does not “benefit China and other countries that have a history of using predatory, illegal trade tactics to target the US steel industry,” according to the letter.