Who Wins in a U.S.-China Solar Panel Trade War?

Photo: Living Off Grid, Flickr
Photo: Living Off Grid, Flickr

Greenough prides itself on our knowledge of the clean tech industry and our ability to serve clients in that industry, which includes solar, wind and biogas, among others. One on-going issue of critical interest across the clean energy industry is Chinese solar panel sales in the U.S.

In early February, the International Trade Commission (ITC) will announce the results of its investigation into alleged solar panel “dumping” by Chinese manufacturers. The possibility of ITC-imposed tariffs against Chinese and other international manufacturers has prompted vocal protest on both sides of the issue by a number of U.S. companies operating in the solar industry.

To understand the full story, it’s worth going back to the genesis of the dispute. SolarWorld Industries America, a U.S. subsidiary of a German-owned corporation, petitioned the U.S. Department of Commerce to determine whether Chinese solar panel manufacturers had obtained export subsidies from the Chinese government. The Commerce Department tasked the ITC with a slate of hearings to assess whether Chinese manufacturers were taking advantage of in-country subsidies and consequently “dumping” solar panels into the U.S. market for less than it costs to manufacture and distribute them.

Companies affected by the issue quickly toed the line in opposing camps, and are watching closely as the ITC proceeds. The Coalition for American Solar Manufacturing (CASM) was first to vocalize its position, led by SolarWorld, and CASM is now rolling out a well-crafted messaging and advocacy campaign in coordination with SolarWorld’s formal petition to the Commerce Department. More recently, the Coalition for American Solar Energy (CASE) entered the debate by charging that tariffs placed on Chinese solar panel manufacturers would amount to “protectionism” and would actually harm the U.S. solar industry – not to mention the ever-advancing goal of grid parity.

Who is right? The ITC is scheduled to announce its determination on February 6 (though this could be pushed back for 30 or even 60 days). Regardless of the ITC determination, this dispute over trade policy will likely continue in other areas of the solar industry, and will have direct impacts on both upstream and downstream businesses in the U.S. solar space. Watch this space for further commentary on the decision.

Jay Staunton is vice president of Account Services at Greenough. He can be reached at jstaunton@greenoughcom.com.