Some Solar Companies Want Duties On Chinese Solar Imports

Some U.S. solar companies are pressuring the Obama administration to impose duties on Chinese solar imports. SolarWorld Industries America, a solar panel manufacturer, filed petitions Wednesday with the Commerce Department and the International Trade Commission alleging that China is illegally subsidizing its solar industry. The company alleges that China is flooding the U.S. market with underpriced solar panels and subsidizing its solar industry in violation of World Trade Organization rules. China’s efforts, the company says, are burdening U.S. solar manufacturers and are partly responsible for seven U.S. companies going out of business or downsizing in the last year.

Some solar companies believe the Chinese industry is illegally seizing control of the U.S. solar market and manufacturing and our jobs. But the petition has caused a backlash in parts of the solar industry, with several companies raising concerns that the effort will hurt some solar companies by raising the cost of panels. Petition opponents believe putting a trade barrier in place would protect this market and keep it safe for a group of manufacturers who can’t compete would stop growth. Opponents hold that petitioning companies can’t compete in the market so they are trying to use tariffs so they can sell their more expensive panels.

Solar panel prices have dropped by more than 40 percent in 2011. That’s great news for U.S. solar developers and generators, who have access to an inexpensive product. But U.S. manufacturers are struggling to compete with countries like China, which has invested billions to build its domestic solar industry and produces huge quantities of cheap panels. Companies like SolarWorld say that they simply can’t compete with the low-cost solar panels produced by China.

The 3,000-page petition alleges that China subsidizes its raw materials, provides preferential loans and offers discounted land, power and water to companies, among other things. The petition also says China is “dumping” underpriced solar panels into the market, making it impossible for U.S. companies to compete. Petitioners believe these subsidies are enormous in size and scope and they are illegal under U.S. law and World Trade Organization law.

Six other solar manufacturers have signed on to the SolarWorld petition. But all of the other companies remain anonymous, fearing backlash for challenging China.

The solar industry’s trade group, the Solar Energy Industries Association, has not taken a formal position on the petition, noting that it has a broad membership that likely has differing positions on China’s role in the solar sector. (The Hill, 10/23/2011)