By Eric Watkins
LOS ANGELES, May 18 – Solar panels are at the center of a dispute between the United States and China, a dispute that grew shriller this week as the Department of Commerce slapped anti-dumping duties on the Chinese solar panel industry.
China’s state television denounced the U.S. government’s decision to levy anti-dumping duties on Chinese solar panels as “protectionist” and insisted that the tariffs were “unreasonable and without basis.”
More than 60 Chinese firms, including Suntech Power Holdings Co., the world’s largest solar panel maker, and Trina Solar Ltd., face a 31% duty on their exports to the U.S., while all other Chinese exporters of solar cells will be hit with a tariff of 250%.
“These duties do not reflect the reality of a highly-competitive global solar industry,” said Suntech Chef Commercial Officer Andrew Beebe, adding that Suntech will work closely with the Department of Commerce prior to their final decision to demonstrate why these duties are not justified by fact.”
‘NO CHOICE BUT TO EXIT’
An anchorwoman with state-run China Central Television expressed the fear that, “If these tariffs are levied in full, Chinese companies may have no choice but to exit the U.S. market.”
Not least, she said U.S. consumers would be harmed by the measures, along with solar U.S. firms in the solar industry – a view not shared by the Coalition for American Solar Manufacturing, which said the decision marked “a very positive” first step.
Gordon Brinser, president of SolarWorld, the company that filed the dumping case against the Chinese firms, expressed satisfaction with the decision.
“The verdict is in,” said Brinser. “In addition to its preliminary finding that Chinese solar companies were on the receiving end of at least 10 WTO-illegal subsidies, Commerce has now confirmed that Chinese manufacturers are guilty of illegally dumping solar cells and panels in the U.S. market.”
The Department of Commerce also granted SolarWorld’s request for a finding of “critical circumstances” to counter the recent flood of Chinese imports into the U.S. market ahead of the decision.
As a result, the preliminary dumping tariffs will be retroactive 90 days from the date the decision is published in the Federal Register.
The case began last October when SolarWorld, with the support of six other solar manufacturers filed anti-dumping and countervailing duty petitions with Commerce and the International Trade Commission.
The petitions alleged that Chinese manufacturers were illegally dumping solar cells and panels in the U.S. market and receiving billions in WTO-illegal subsidies. Commerce issued its preliminary decision on the countervailing duty petition on March 17, 2012.
“Commerce’s ruling in the SolarWorld case is a bellwether decision,” said Steve Ostrenga, chief executive officer of Helios, one of the six firms that launched the complaint along with SolarWorld.
“It underscores the importance of domestic manufacturing to the U.S. economy and will help determine whether the country will be a global competitor in clean technologies or outsource them to China,? Ostrenga said.
But disagreement over the finding of the Department of Commerce came from the Coalition for Affordable Solar Energy, a lobbying group that represents domestic solar installers, Chinese manufacturers and others in the industry said the decision will raise prices for consumers.
“We think it’s raising taxes 31% on solar cells and we think it’s going to increase solar electricity prices in the U.S. precisely at the moment that solar power is becoming competitive,” said Jigar Shah, president of the Coalition for Affordable Solar Energy.
The decision by the Department of Commerce coincided with reports that China’s solar panel industry is mired in widespread losses, its profit margins crimped as prices have fallen faster than production costs amid huge overcapacity.
TOO MANY PLANTS
The South China Morning Post reported that the industry, which exports about 85% of its output, has built “too many plants and has suffered from a slowdown in growth in overseas markets.”
Its biggest market, Europe, has cut back subsidies amid its sovereign debt problems.
The paper cited Dr Henning Wicht, principal solar sector analyst at industry research firm iSuppli, who projected global prices of solar panels would fall a further 20% this year after declining 38% last year.
Wicht also forecast that the growth rate of solar panel installations worldwide would drop to less than 10% this year and next year, from 55% last year, before recovering to between 20-30% during 2014-16.
© Glamma Productions Inc. 2012