SolarWorld’s China Trade Complaint Divides U.S. Solar Industry

SolarWorld’s China Trade Complaint
Suntech Power Holdings Co., the world’s largest solar panel maker, is reviewing the complaint. Photographer: Qilai Shen/Bloomberg

A trade complaint seeking to protect U.S. manufacturers of solar panels from unfair competition from Chinese rivals may harm other parts of the U.S. solar industry, project developers said today.

The complaint filed yesterday by the U.S. unit of Bonn-based SolarWorld AG and six other panel makers asked the government to impose duties on more than $1 billion of Chinese imports.

The action may drive up prices for U.S. companies that buy solar panels and slow the use of renewable energy, said Arno Harris, chief executive officer of Recurrent Energy, the San Francisco-based project development unit of Sharp Corp. Solyndra LLC, the failed panel company that received a $535 million U.S. Energy Department loan guarantee, cited cheap Chinese products in its September bankruptcy filing.

“The result of that action is really not good,” he said yesterday during a conference call with reporters. “It prevents Americans from getting access to low-cost solar panels and low-cost solar electricity.”

The complaint filed with the International Trade Commission alleges that Chinese companies have sold solar panels below cost. China produced 55 percent of the world’s panels in 2010, according to Bloomberg New Energy Finance.

The dispute is “in the narrow self-interest of the manufacturers” Harris said. “It’s clearly not in the interest of slowing global climate change.”

China’s ‘Positive Role’

Nor will it help companies build solar projects, said Carlos Domenech, president of SunEdison, the development unit of St. Peters, Missouri-based MEMC Materials Inc.

“I think China is playing a positive role in lowering panel costs for U.S. consumers,” he said today in an interview at the Solar Power International conference in Dallas. “Reducing the cost of panels also helps create green jobs in the U.S.”

The dispute is “a matter of manufacturer versus manufacturer and it’s not the whole industry,” Rhone Resch, chief executive officer of the Solar Energy Industries Association, said today in an interview.

He said the Washington-based trade group hasn’t taken a position on the trade fight. “We’re not involved so our role is only to keep people informed of what develops.”

The U.S. exported more solar products last year than it imported, by $1.9 billion, according to an August report from SEIA and GTM Research. Polysilicon, the raw material in solar cells, and manufacturing equipment made up the majority of the $5.63 billion in exports, and much of that went to China. The U.S. imported $2.4 billion in solar panels.

Falling Panel Prices

Cuts in incentives in Europe and large increases in production drive down solar panel prices more than 40 percent this year, breaching the $1-a-watt milestone this month, Aaron Chew, an analyst at Maxim Group, said in a research note today.

SolarWorld is part of the newly formed Coalition for American Solar Manufacturing, whose six other members are also petitioners in the ITC complaint. The company’s SolarWorld Industries America Inc. unit received an $82.2 million clean energy manufacturing tax credit to expand a plant in Hillsboro, Oregon, in January 2010.

The six companies haven’t been identified. “It is not uncommon that companies will support a case and have their identity remain confidential,” Adam Gordon, a partner at Wiley Rein LLP, which filed the petition for SolarWorld, said today in an interview.

“This petition is supported by a significant majority of the U.S. industry,” Gordon said, which the petition defines as “the domestic industry producing crystalline silicon photovoltaic cells and modules.”

Suntech Power Holdings Co., the world’s largest solar panel maker, is reviewing the complaint. “Anyone can file one of these actions,” the Wuxi, China-based company said today in a statement. “We are confident in our position and well-prepared to substantiate our strict adherence to fair international trade practices.”

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