After reviewing the petition brought by SolarWorld, the U.S.
Department of Commerce recently announced it will impose
anti-subsidy duties against US imports of Chinese solar technology
products and block state-sponsored Chinese solar producers from
evading US duties on their solar panels by outsourcing production of
photovoltaic cells to third countries, such as Taiwan.
Effective immediately, the Commerce Department imposed preliminary
duties of 35.21 per cent on imports of panels made by Suntech Power,
18.56 per cent on imports of Trina Solar and 26.89 per cent on
imports of most other significant Chinese producers.
Mukesh Dulani, president of SolarWorld Industries America Inc.,
called the ruling a “strong win” for the U.S. solar industry,
adding: “We look forward to the end of illegal Chinese government
intervention in the US solar market, and we applaud Commerce for its
work that supports fair trade.”
SolarWorld’s petition — which covers panels assembled in China from
Taiwanese or third-country cells made from Chinese inputs — alleges
that Chinese solar producers benefit from an array of government
assistance, including cash grants, discounted loans and loan
guarantees, free land and utilities, and heavily discounted
polysilicon, solar glass and aluminum extrusions.
In filing the petition, SolarWorld said it was acting with support
from the Coalition for American Solar Manufacturing (CASM).
Many of CASM’s founding manufacturers, SolarWorld argues, are no
longer in business or struggling to restructure.1 CASM
represents nearly 250 companies employing roughly 21,000 Americans.
Industry response
Those companies named in the petition — and now set to face hefty
duties — are clearly at odds with the ruling by the US Commerce
Department.
“The US ruling imposing a 35% duty on Wuxi Suntech is completely
unfair, as our company receives no subsidy from the Chinese
government,” said Suntech CEO Eric Luo. “Our ability to
produce high-quality, low-cost PV modules stems from our highly
efficient manufacturing process and from the scale of our supply
chain.”
As a leader of a company which was shaken up by the sudden drop in
prices of solar modules, Luo says he can share his American
competitors' concerns over extreme price declines. At the same time,
he points to the need to highlight the greater risks of industry
instability – to which the current trade disputes (in his opinion)
are contributing.
“The real danger we're facing as an industry is not if a Chinese,
European or American company goes bankrupt, but if the entire
industry value chain collapses,” Luo explained. “China can
manufacture high-end panels at truly competitive prices, but it
cannot replace inexpensive, high-quality American silicon — or a
talented American workforce, which would be the first to suffer from
a spike in prices of solar energy."
Trina Solar, another compulsory respondent, faces lower duties
than Suntech (18.56%), the lowest among the Chinese
exporters. Still, the company says it is disappointed by the
preliminary findings and believes the allegations made by SolarWorld
are contrary to the principles of free and fair trade, and are
ultimately unfounded. Furthermore, Trina Solar stresses that its
transactions with all its customers in the United States are in
accordance with international trade practices.
In a written response, Trina Solar stated: “As a company, Trina
Solar is dedicated to bringing the benefits of clean and innovative
solar energy products and services to our customers around the
world, and we remain committed to serving our many customers and
business partners in the US, where we have built a solid and
long-standing reputation for high-quality products and services."
The statement goes on to say: "With deploying the strategy prepared
for further growing Trina Solar’s business in the US market, our
competitive cost structure, our in-house manufacturing abilities,
our brand and quality recognition in the market will provide us the
competitive strengths not only amongst the Chinese solar
manufacturers, but also globally. We believe we will continue to
grow our business in US profitably, and we will continue to play an
important role in the US market and serve our customers in the
region.”
Precedence set
Back in late 2012, the US crystalline silicon solar
manufacturing industry won duties averaging 31 per cent to offset
illegal government subsidies that enabled Chinese producers to sell
at artificially low prices to seize market share from domestic
manufacturers operating within the US market. But fair trade
advocates say many Chinese producers evaded the duties by
commissioning manufacturers in other countries to partially or fully
produce solar photovoltaic cells for assembly into solar panels back
in China. According to SolarWorld, state-controlled Chinese media
said at least 70 per cent of US imports from China contain Taiwanese
cells. To that end, SolarWorld filed cases on 31 December to close
the loophole.
Industry observers say more fallout is expected on July 25, when the
Commerce Department is scheduled to announce anti-dumping duties in
the aforementioned cases.
- In March, Sharp Solar was forced to shut down its manufacturing facility in Tennessee amidst aggressive import pricing pressure, among other competitive issues.