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SolarWorld Among 20-Plus Manufacturers to File EU Complaint

A SolarWorld coalition of European-based manufacturers officially filed a trade complaint in Brussels late Wednesday, eliciting a strong response from leading Chinese manufacturers and setting the stage for a process that could further shake up the global solar industry.

SolarWorld’s Germany-based operation was certainly emboldened by the thus-far successful initiative launched by its American subsidiary in the United States, where modules with Chinese cells from leading manufacturers are being hit with preliminary tariffs totaling about 35 percent. Now, SolarWorld turns its attention to the far larger European market, which has gone through a remarkable growth period with installations dominated by Chinese products. In 2011, about 74 percent of the world’s new installed capacity came in Europe. Meanwhile, some of the European companies that a few years ago dominated the solar industry have filed for insolvency while citing their inability to keep up with Chinese competitors.

While the scope of the request made to the European Commission remains unclear, SolarWorld has cemented its place as the company that continues to drive the effort to push back against Chinese products. The company for months has been building a coalition of companies willing to file a complaint. The complaint was officially launched by EU ProSun, a group of more than 20 European solar manufacturers. None of the companies was named in a release issued by the newly formed group, but it did indicate that its president will be Milan Nitzschke, a vice president for SolarWorld AG. According to Bloomberg, Nitzschke said the group includes companies from Italy, Spain and Germany, and that it includes German manufacturer Sovello.

“Chinese companies have captured over 80 percent of the EU market for solar products from virtually zero only a few years ago,” he said in a press release. “EU manufacturers have the world’s best solar technologies but are beaten in their home market due to illegal dumping of Chinese solar products below their cost of production.”

A short time after SolarWorld filed its American complaint, a group of American companies and large Chinese manufacturers launched the Coalition for Affordable Solar Energy (CASE), arguing that the low-cost panels are helping the industry achieve its goal of widespread adoption. A similar divide is likely to follow the EU case, especially as many European nations see their goals of a renewable-powered grid coming to life. The European-based Alliance for Affordable Solar Energy (AFASE) so far has 70 members including material suppliers, equipment manufacturers, project developers, installers and maintenance companies.

Findings in the EU are generally less punitive than in the United States, according to a Brussels-based trade attorney, and the commissioners who ultimately make a ruling can take into account external factors such as the impact on the overall economy and the effect on the environment. The U.S. Department of Commerce does not consider those factors when issuing a ruling.

According to published reports following a media briefing in China on Thursday, Yingli Solar's chief strategy officer Wang Yiyu said “the investigation would also trigger a whole-scale trade war between China and the EU, which would cause huge losses to both parties.” He was joined at the briefing by SunTech, Trina and Canadian Solar. According to the companies, almost 60 percent of its exports went to the European market in 2011, and a trade ruling on behalf of SolarWorld would have a devastating effect on Chinese manufacturers.

A trade investigation in Europe could hasten China’s move to expand into emerging markets. Chief among those is the emerging Chinese domestic market, would could install 6 gigawatts (GW) this year alone with a target of 21 GW by 2015. There’s already talk that those numbers could push upwards as the nation starts its march to become the world’s leading installation market. China is also making efforts to tap into the expanding Japanese and Indian markets while beginning to invest in peripheral Asian nations. China is also moving toward markets like Chile, where the installations are few but the potential is immense.

The European market, meanwhile, has been surprisingly resilient — mostly because of those plummeting PV prices. However, Europe as a whole is on a path to a major scale back in its PV policies as struggling nations look to cut government spending in the face of an EU debt crisis.

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