JA Solar Withdraws From EU Minimum Solar Pricing Agreement

  • Commission’s minimum price doesn’t reflect market, says JA
  • Panels exported to EU will be made outside JA’s China plant

JA Solar Holdings Co., the fourth largest maker of solar modules, opted out of an European Union program that spares them from paying tariffs in exchange for agreeing to a minimum price-floor for their products.

The minimum price set by the European Commission’s Price Undertaking program is outdated and “considerably” higher than average selling prices in the 28-nation bloc, the Shanghai, China-based company said in a statement to GlobeNewswire Inc. on Wednesday.

JA Solar is the second manufacturer after Trina Solar Ltd. to voluntarily withdraw from the Commission’s Price Undertaking, which was introduced in 2013 to allow Chinese exporters to avoid anti-dumping and anti-subsidy duties on solar cells imposed by another EU body, the Council of the European Union.

At least 16 other companies have lost the exemption for allegedly breaching terms of the price undertaking, and about another 100 companies remain in the agreement.

JA Solar said all future panels sold to the EU will be manufactured outside of China, allowing it to circumvent the tariffs. “Selling prices continue to decline, while the MIP has remained unchanged for the past 18 months,” said Baofang Jin, chairman and chief executive officer of JA Solar, in the statement.

Competition among Chinese solar manufacturers has created a glut of panels, squeezing margins and pushing down prices by about 80 percent since 2009, according to the International Renewable Energy Agency.

“Unfortunately, the current MIP adversely affects our ability to execute our business strategy and hinders the growth of the European solar industry,” Baofang said.

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