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The USITC Decision Watched in Dispute Over Solar Imports from China and Taiwan: Reuters

published: 2014-02-17 16:30

The U.S. International Trade Commission made a preliminary decision last Friday and determined that solar products from China and Taiwan did injure U.S. solar industry. As a result, tariffs on some crystalline silicon products will be imposed to protect the fast-growing U.S. solar industry. According to a Reuters’ report, this causes a dispute and it’s necessary to be settled for the U.S. solar industry.

SolarWorld AG is an U.S. branch of German solar manufacturer which makes crystalline silicon solar panels. It twice accused that Chinese solar products injured domestic solar industry by dumping cells / modules with rich subsidies supported by the Chinese government. In 2012, penalty tariffs were imposed; this year, furthermore, the second petition was accepted and filed so ITC and DOC will continue discussing the duties to charge on solar products from China and Taiwan -- Chinese manufacturers are sidestepping the duties by shifting production of the cells used to make their panels to Taiwan and continuing to flood the U.S. market with cheap products, described in Reuters' report.

The preliminary determination was announced on February 14th as affirmative. Shayle Kann, senior vice president at solar market research firm GTM Research, said in the Reuters’ report: "Either the manufacturers will have to set up manufacturing elsewhere or they will have to pay the tariff. Either way, the impact will be a lot more than it was the last time around," indicating that this will make a broader impact to the global situation. "If the Commerce Department imposes tariffs that are significant with the scope SolarWorld has proposed, then prices for solar panels will be noticeably higher than they otherwise would have been."

According to Reuters, the Coalition for Affordable Solar Energy said the cost of modules had already gone up 10 percent since December 31, 2013, when the complaint was filed, as Chinese manufacturers prepared for likely heftier duties. Jigar Shah of the coalition said: "If ITC go against us, that could be an immediate 20 percent increase in solar module prices. We might lose tens of thousands of jobs.” He believes that higher duties can benefit workers of the U.S. solar industry.

Likewise, SolarWorld Chairman Frank Asbeck wrote to President Barack Obama a week before ITC’s announcement that Chinese subsidies and lower price is injuring U.S. manufacturers: "Illegal trade practices threaten to destroy any ongoing U.S. role in global solar industry competition."

As EnergyTrend’s data shows, solar cells and modules made in China and Taiwan represent almost 60 percent of the global capacity respectively, and the report wrote that about half the solar equipment installed in the United States last year was made in China. The report also gave the figure of the fast-growing rooftop solar market: 71 percent. ITC has concludes that Chinese solar products (and those made in or shifted from Taiwan) cause affirmative damage to the domestic industry so DOC will take over the probe to set duties in the following months.

Reuters toned this determination as a dispute within solar manufacturers and the governments of China, Taiwan and USA. However, the report also mentioned that Solar Energy Industries Association, a U.S. trade group, has been trying to get SolarWorld and all the related institutes to settle the dispute. Under the association's settlement proposal, Chinese companies would agree to pay into a fund that would then be used for the benefit of U.S. solar manufacturers. The deal would require China to revoke the restrictions on imports of U.S. polysilicon.

The broader tariffs would definitely cause deeper impact on both Chinese and Taiwanese solar industry, even changing how the global solar trade will go. 

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