Bill Opalka | Nov 01, 2010

The road to the clean energy economy is getting a little bumpy as one of its most prominent champions said China is using illegal subsidies to export solar panels and wind turbines. The United Steelworkers of America wants the government to file a trade case before an international body and has a 5,800-page document to bolster its claims.

If the United States doesn't build a clean energy economy, the Chinese gladly will. That's treated like gospel in the Obama administration, and among renewable energy trade groups. Take one look at the plummeting cost of solar panels and increased Chinese market share, for instance, and you can see why.

Now, that message has gotten a little more complicated.

The United Steelworkers of America (USW) has asked the Obama administration to file a trade case against the Chinese before the World Trade Organization [3] (WTO), essentially saying that those great deals on solar panels are due to illegal subsidies given to exporters.

"China has utilized hundreds of billions of dollars in subsidies, performance requirements, preferential practices and other trade-illegal activities to advance its domination of the sector," the USW said in a statement.

The USW, having fought battles on the trade front over dumped steel against Japan, China and other countries for more than three decades, isn't afraid of a fight like this.

"Green jobs are key to our future," said Leo W. Gerard, International President of the USW. "Right now, China is taking every possible step - many of them illegal under international trade laws - to ensure that it will control that sector. America can't afford to cede more of its manufacturing base to China."
 
The trade associations for wind and solar are now in a tight spot. What complicates the matter for them even more is that prominent association members are American and European manufacturers of wind turbines and solar panels that openly court Chinese customers with plants based there, or who have set up joint manufacturing ventures in the Far East

The trade associations also have significant membership among smaller U.S. manufacturers who have expanded or converted operations to serve the domestic component markets. Think about the bolt makers who now make parts for wind turbines or the automobile mirror companies that have added concentrating solar panels.

As reported here previously, groups like the American Wind Energy Association (AWEA), the USW and the manufacturing-environmental group the Blue Green Alliance (BGA) have partnered to promote favored policies [4] in Washington like a national renewable energy standard (RES), manufacturers tax credits and the extension of U.S. Treasury grants.

One association avoided taking sides but essentially took the opportunity to remind policymakers that the status quo is a loser for the U.S.

"China and many other countries are using every tool at their disposal to lead in clean energy manufacturing including strong renewable energy targets. The U.S. has an opportunity right now to stay in the game by passing an RES -- one of the very few policies that has bipartisan support in Congress," said AWEA CEO Denise Bode.

The BGA (which includes the steelworkers) was more confrontational.

"Every day America delays action is another day that China capitalizes on jobs created in the production of clean energy technologies that could and should be developed, manufactured, and installed in the United States," said its Executive Director David Foster.

As reported by the New York Times [5], the case practically forces the hand of the Obama administration to take a stand on the issue before the November election. By law, the U.S. Commerce Department has 45 days to respond with an October 24 deadline to begin proceedings before the World Trade Organization.

One more thing: China has not been afraid to retaliate against complaining trade partners.

Another day, another issue that makes the transition to a clean energy economy seem more difficult.

This story first appeared in RenewablesBiz Daily and was written by Bill Opalka, its editor-in-chief.

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