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Don't Miss The Great Solar Debate: Where Does the Global Solar Industry Stand? Click Here to Register! ×

Another Volley as US-China Trade Battle Intensifies

Steve Leone, Associate Editor, RenewableEnergyWorld.com
May 24, 2012  |  30 Comments

China's Ministry of Commerce on Thursday said that after a months-long investigation it has ruled that the United States government broke World Trade Organization rules by supporting six renewable energy projects through unfair grants.

The department didn’t say what the projects were or whether it would impose any punitive measures. According to the Associated Press, an earlier announcement of the investigation indicated the probe would cover wind, solar, hydro and other renewable energy technologies for projects in Washington, Massachusetts, Ohio, New Jersey and California.

Tensions between China and the United States have been running high in recent months, and last week Beijing officials accused the Obama administration of “protectionism” following a 31 percent anti-dumping tariff it slapped on Chinese-made solar cells imported into the growing American market. The dispute over clean energy is far-ranging and it underscores the huge potential both countries see as they jockey for leadership in innovation, manufacturing and generation.

Recent legal battles include America’s push to ease China’s grip on rare earth minerals. The nation controls 97 percent of global production for minerals that are vital to everything from wind turbines to electric vehicles. The U.S. Department of Commerce is also investigating a trade complaint filed in December from domestic wind tower manufacturers against Chinese and Vietnamese manufacturers. The petitioners, which include Trinity Towers, DMI, Broadwind and Katana Summit, is looking for countervailing duties and anti-dumping tariffs of 64.37 percent for China and 59.11 percent for Vietnam.

And companies on both sides of the Pacific have done battle over intellectual property. The biggest dispute has been between China’s Sinovel, which has been accused by American Superconductor of stealing technology.

Perhaps the issue that has loomed as the most immediate potential retaliation from China is over polysilicon trade. Fear of backlash from China’s central government was a concern even before the trade complaint was filed in October. Then in November, China’s polysilicon suppliers filed a case accusing American producers of dumping their product into China.

According to Solarbuzz, China is the world leader in polysilicon production at 40 percent with the U.S., Germany, Korea and Japan making up the collective majority. China, though, uses that polysilicon to make 76 percent of the world’s solar wafers. Because of this high-volume wafer production, companies like America’s Hemlock, Germany’s Wacker and Korea’s OCI pump much of their product into the China market.

Chinese customs data, according to Solarbuzz, shows that in February and March of this year, tonnage of American polysilicon imported by China more than doubled the rate seen over previous months. That’s because the price dropped rapidly since the end of last year, making it the cheapest option. In March, that price was $4.4 per kilogram less than the average import price.

From there, the story looks familiar. Domestic producers have stopped or severely cut back production because of the falling prices, and they are asking their government to intervene. It’s impossible to say whether the recent DOC ruling will weigh into China's decision, but it certainly won’t help American polysilicon producers keep access to the world’s largest market.

30 Comments

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MARK SMITH
MARK SMITH
June 6, 2012
Also check out Nanosolar and Solaria...up and coming small solar panel companies with facilities in California , Germany, India, etc.
MARK SMITH
MARK SMITH
June 5, 2012
#21: Total recently purchased controlling interest in Sun Power.
#25: Wanxiang Solar has a small solar panel assembly plant in my hometown, Rockford, IL
#27: There are a half dozen utility scale solar panel projects set to begin construction in the SW USA soon. I recall that they all had some federal incetives, but those funds expired for new projects last dec..Also AES, which is very well financed, has had several such projects in the works,but I have seen no start dates. I read a lot of internet new letters.

I wish I understood all that technical stuff mentioned above.
Gary Richardson
Gary Richardson
June 5, 2012
@Peter
Interesting point of view and I have heard something to that effect. If true, then who is receiving intense capital from cell fabrication. Perhaps this will point the way to where the capital is stagnating or is the source of subsidies/cheap loans to support artifically low prices.
Chinese energy companies?
Rare Earth industry?
Polysilicon producers?
Silver mining?
Peter Bradshaw
Peter Bradshaw
June 4, 2012
I am confused about LCOE! Love Charlene On Estrogen? Layer Cheese Over Eggplant? Lazy Chinese Often Emigrate? Leave Check On Easychair? Low Cost Ovens Everywhere? Lobbyists Consolidate Oil Excesses?

As to assembling panels here from foreign-made cells, the historic pattern in the semiconductor industry is the opposite; cell fabrication (IC fabrication) is capital-intensive, but low in labor cost, so done anywhere, including in the US, but assembly is low capital cost but labor-intensive, so done in developing countries. The shipping cost for ICs is, of course, very low in comparison with value, and this is probably not true of PV panels. Of course, car manufacture is the other way around.

The 'solar financing investments...' here in the US are largely done by PV installation companies, rather than panel manufacturers (except in a few cases where one company does both). I would not expect such financing to be done by a Chinese panel maker. The funding mostly comes from a bank, surely.
Gary Richardson
Gary Richardson
June 4, 2012
Another angle to this story is the disparity between Chinese and American trade overlooks franchise owners in convenience business such as fast food, gas stations, mini-marts, and other stores who have:
*made millions from their ventures (Mc Donalds, Arco, Oil Lube, etc...)
*paid off their debts decades ago
*benefited immensely from loopholes in our tax code
*send large amounts of their earnings back home every year, perhaps undetected by GDP figures because of US citizenship blanketing thier economic movements.
*many of these workers of franchises (except the manager) are underpaid and cannot support financing a mortgage let alone a PV integration.

Perhaps it is wise to not only consider tariffs as the only measure against economic hemmoraging but one of many tools to manage this type of economic loss.
Gary Richardson
Gary Richardson
June 4, 2012
I agree with smith mark @#20 they could at least assemble them here.

Also @Jens, do you know of any solar financing investments for american commercial/residential conducted by Chinese firms?
If not, then why?
Gary Richardson
Gary Richardson
June 4, 2012
Continuing on from #23

This threatened loss of competitive advantages also causes fear amongst potential PV consumers to pay down debt levels low enough to survive loss of wages and other earning potentials.

For instance, those impacted have tried to do this by hedging investments overseas in places like Brazil, Russia, India, and China (BRIC countries) only to face markets restricted by exclusive contracts given to government ran industries, theft of intellectual property, tarrifs imposed on us, limits on currency revaluations and other economic impingements/limitations.

Continuing on, those in the Middle East will also fight to hedge their future losses by tying money up in resource investments. By the looks of it, the impingements/restrictions mentioned earlier appear to be resource investments on China's part. As a result of resource reallocation, the question begs to when will the money flow back to us to afford buying imported panels projected to cost 80% less 10 years from now?
Gary Richardson
Gary Richardson
June 4, 2012
#22 continued

I'd like to back up a little here and mention other influences our collapsing housing bubble has revealed.
For starters, the GDP of America is partially hedged against the inheritance of baby boomer and Gen x wealth. Such hedging ocurred because many parents of new homeowners had come to the rescue of their children by borrowing against their assets.

Unfortunately, these parents also defaulted as well and are now penniless. Such hemmoraging was quickly soped up by many imports such as personal electronics (wide screen televisions, computers, laptops, tablets, smart phones, etc...)

In turn, these dollars are not coming back because they are being used to bail out other economies.

This bleeding shows up in the equation in #22 (see below) at the difference between exports/imports and investments overseas.

GDP = private consumption + gross investment + government spending + (exports ? imports)

This bleeding is not sustainable under current circumstances because the well is running dry and some are not taking risks with their investments.
To elaborate further on investment risk:
I. If you invest in financing rooftop solar you want to be sure that those who buy can pay it off plus interest.
a. Their borrowers earnings have to be sustainable
1.installation jobs created from investments rely on outside industry jobs (aerospace, farming, other exports/investments) for financial stimulus. Additionally, many of these other industry sources are or were heavily invested in real estate/stocks and are currently recovering from their losses. Therefore, we have to turn to importers currency rising enough in value to entice growth in our export market. However, our importer sources are also nipping away at our competitive advantages (China is starting to develop their aerospace industry)
There is more
Gary Richardson
Gary Richardson
June 4, 2012
@Jens,

When tying LCOE to GDP, I looked at how GDP is calculated on an expenditure basis:

GDP = private consumption + gross investment + government spending + (exports - imports)

I then look at some of the influences of how GDP rises and falls but with one catch.....

I'm looking at solar's worth from only my perspective and to those around me and what I see as worthwhile is:

*Investment by those who can:
1. Pay in full a complete PV system with 2 tier storage
(preferably electric vehicle with auxiliary storage, or similar replacement of more expensive energy sources)
2. Hedge collateral against a loss of earning potential and yet come out ahead because of a lowered financial footprint. (offer lower wages to stay employed or sell a product at lower costs than my competitors and yet still pay on the loan for PV setup mentioned earlier)

However, we have a large consumer base that is affected by the housing bubble and is experiencing some of the following:

1. Mortgage is under water
2. Earning potential is threatened by lower wages overseas or other changes to administration policies
3. Incurred debt is at risk of default due to #2

There is more
George Reynoldson
George Reynoldson
June 4, 2012
Though, as comment #1 suggests, this spat does fit many aspects of a simple game theory matrix, but to confine this discussion to solar or national competition seems uncomfortably similar to the simplistic energy debates and political disinformation tactics that destroyed US solar thermal in the early 80s. Unsurprisingly, as then, the two dueling "energy prisoners" formed within the DOE PR bureaucracy were really Mr. Carbon Extractor vs. Mr. Solar Converter. And as then, natural gas was billed as our economic savior with minimal environmental discussion or even a concern for the long range impact that this solar detour may have on an already unsustainable American infrastructure. So it hardly seems coincidental to me that this two-country trade war just happens to coincide with this week's glitzy World Gas Conference (a zero-sum minded cartel) in Malaysia. What a fantastic run up! Even Romney's grandstanding at Solyndra headquarters yesterday to discredit solar serves the purpose of a well timed smokescreen for more energy biz as usual. It even fits his Reagan wannabe imagery to a tea!

Yep! It sure seems like a well scripted plan to me! There, in Kuala Lumpur, executives from BP, Exxon Mobile, Shell, Chevron, Total etc. will quietly tout their new gas-fracking and liquefying technologies to other energy giants and all energy hungry political leaders from China, Poland, Japan etc. and all other points of interest around the world. And like in June of 1982, while the media thoroughly marginalized solar, a hopeful and growing collection of solar manufacturers are again headed to bankruptcy court and/or prostrating themselves for new tax credits at the feet of Mr. Carbon Extractor's offspring, Big Gas.

This is not a single-industry trade war! It is an emotionally charged and well-scripted geopolitical extension of the Reagan era Energy Great Game of 1982 when US gas extraction thrived and the President publicly claimed solar was simply not needed!
MARK SMITH
MARK SMITH
June 4, 2012
Obviously some very sharp people read this news letter.

Worldwide chinese business strategy is very consistent. What's theirs is theirs and what's ours is theirs. In this case, we did put that stick in their wheel.
But in some ways they are not very smart.USA cannot repay their $trillion if Americans don't have jobs to pay income taxes.
Americans are better off without any imported solar panels. If foreigners want to sell solar panels here, they should at least assemble them here..
Jens Stubbe
Jens Stubbe
June 3, 2012
#18 Hi Gary Prize is price, BNP is GDP and GRID is meant as the electric grid. I will be more careful in the future. ;)

The situation in the PV business is that supply and demand does not meet well through out the entire value chain.

Currently US PV panel manufactures just like PV manufacturers all over the globe face a market situation where global over investment in production capacity, despite a booming market, has led to a much lower price point than hoped for.

The principal ways to bring PV LCOE down and thus stay competitive are to lower square meter prizes and increase efficiency.

The problems for US PV manufactures are that they cannot lower squaremeter prices as they produce without profit margins as it is and while US researchers have a unique track record for developing PV technologies the US PV industry cannot get exclusive rights to the outcome of these researchers work.

Companies such as 1366tech would never limit their technology to US panel makers only - they would go for the best paying customers they can find.

1366tech is started by scientist from MIT backed by VC and government, and there is simply no way that government and VC's will accept that 1366tech limit their market to domestic players.

As a nation I think USA should relieve fossil dependence and establish RE capacity that delivers the cheapest possible power.

If this benign development for the entire globe means transfer of US technology and purchase of products produced in China then it is no different from the situation in the computer industry or many other industries where the hardware production has migrated to Asia.
Gary Richardson
Gary Richardson
June 2, 2012
@Jens
Please proof your statements so I am not guessing what you mean.
I assume
prize is price
BNP is GNP or GDP
GRID???
Jens Stubbe
Jens Stubbe
June 1, 2012
#15 I totally agree that you have to emphasize consumer protection. For the utility installation I think there almost always will be engineers involved but for the ordinary house owner there should definitively be reliable industrial standards. Very few PV companies has a track record of 30 years and none of the products that are available looks even remotely like the 1982 models so the pivoting point of established credibility is really tricky. Samsung was rumored to enter PV industry more seriously last year and if they did this I would undoubtedly believe them and their products because they have a consistent semiconductor track record. I would in fact be prepared to pay a premium prize for the very reason you point out about credibility and commitment to customers.

Consumers does however not have to rely directly upon the producer of PV but could just as well rely on the retailer, the installer or the PV service provider.

Your vision of US retooling to bring US PV back to competitive prizing is not realistic. The kind of mega factories you will see in the next few years resemble the mega factories that build displays and there is only one display manufacturer cluster in the world and that is in Asia. The same will be true for semiconductor based PV.

Just as with displays US researchers will still contribute to the technology progress and many companies will still hold patents and ripe the benefits of licensing to the PV manufacture industry but I do not see a future where US PV industry, which is currently 1/10 of chinese PV industry, can turn the tables.

Further you do not have to rely on domestic PV to enjoy the benefits of reduced fossil dependence.
Jens Stubbe
Jens Stubbe
June 1, 2012
#13 I share your concern over human rights in China but you should consider the competitive situation. It is not labour cost but labour skills and knowledge that differ between China and US. Thousands of jobs have been lost in Denmark over the years to countries with little or no labour rights, little or no regard for human rights and often un fair government subsidies.

In the great scheme of things it is natural that the poor masses in developing countries have to ask less for their labour. The international economy is based on labour division where not all production can stay in the developed countries.

The energy usage from 1950 to 1960 equaled all the years since the dawn of mankind and this happened again from 1960 to 1970. This stunning growth happened because the energy usage grew 7% annually. Today the world economy grows 5% annually. Growth is still needed as about 2 billion people are of GRID but growth is no longer sustainable based on fossil energy.

Since the beginning of the industrialization cost of energy has dropped relative to BNP. In the last few years and in a few years in the seventies the energy prize trend was reversed but I consider this to be an energy prize bubble. With just 7% annual LCOE decrease for PV the prize will drop 50% in just 10 years and with just 15% annual LCOE decrease the prize will drop 80% in 10 years.

Wind has had about 5% LCOE decrease as a general trend but is picking up due to fiercer competition.

The transition to RE energy is under way and will undermine the current high fossil energy prizes. Most of the associated job creation and economic growth will be in the sales, installation and service businesses as the hardware prizes continue to drop. US job creation and US foreign exchange depends upon access to cheap PV and wind - and for PV this means chinese.
Gary Richardson
Gary Richardson
May 31, 2012
@jens response to #7 post @#10 post,

I believe America has enough innovative edge to retool below existing low PV costs without much impact to growth trends.
The concern I see here is having ANY type of open market drive lower costs.
Do you have no concern over the living conditions of the workers making these panels?
Perhaps you believe the lowered costs come exclusively from 10X scaled production and have no unfair advantage.
What proof do you have of living conditions of these PV workers in China?
If you accept the standards of living of these workers without enough evidence then that sets the precedence of establishing it here. Then the only true opportunities of getting decent pay is corrupt business practice and government policy.
Temporary tarrifs help to buffer against those who falsely sell 10year panels as 25year warranty and conveniently go out of business at 11 or 12 years to appear sincere. These momentary measures also make it expensive and risky to retool for counterfiet panels in a restricted or closed market.
MARK SMITH
MARK SMITH
May 29, 2012
Some of these comments are close to the truth. Most are not.

To China, a communist country, treatment of businesses like solar anything is part of longterm national strategy. Our laws mean nothing to them.If they momentarily happen to be on the right side, it is just coincidence. Without government help even large American or European companies cannot compete against the government of China. Period.
Mark Hagerty
Mark Hagerty
May 29, 2012
Peter - It seems the figures you gave for California hold true for Michigan (percentages not kW installed) We have done more residential jobs but the kW we have installed for commercial/municipal exceeds the kW installed for residential.

Jen - It really surprises me how passionate people get about supporting a country like China that has human rights abuses to the extent they have. Or a country that routinely sends dangerous and poorly manufactured items like they do on a daily bases. We have given them our steel industry, machine tool industry, appliance industry and many others. On equal footings those industries would have survived but we cannot pay uneducated labor $40.00 a hour while they are paying the same laborers $2.00 an hour. Our country cannot survive with a service industry base. The only argument I can think of to support your position is gaining a year or two on saving the planet at the expense of our country.
When we started installing solar we were charging around $8.50 a watt. Now we are charging around $4.50 a watt. In the same time frame electricity has gone up about 20%. We can offer a payback term of around 8 years for panels that have a life expectancy of about 35 years and a warranty of 25 years. Our industry survived for 30 years before the Chinese got into it. We have seen it go from first adopters being our only customers to people doing it, without incentives, because it makes good business sense. Solar is here to stay the question is are we going to have to rely on China for our energy in the future.
Jens Stubbe
Jens Stubbe
May 28, 2012
#11 Thank you Peter these figures are new to me. If US PV producers can make a convincing case for their claim that they supply better value for money in terms of LCOE then they should compete for utility projects.

The PV utility LCOE should drop about 80% in the next ten years due to a combination of efficiency improvements, better optics, longer projected lifetime, better solar traction, better cooling, better localisation, better land utilization, better electronics, lower BOM, less maintenance requirements, better industrial integration of the entire value chain and better financial instruments.

80% equals that PV LCOE drop consistently 15% annually in the coming 10 years, which is far less than the display business prize down spiral we all have gotten used to and consistent with Ray Kurzweils law of accellerating returns.

80% LCOE price drop should still leave room for very healthy margin improvements in the business as it is not so much about making things cheaper but rather about making things better.

US companies that whine over chinese competition and the lack of the needed PV production infrastructure makes the case for US PV panel industry as a part of a solar future unlikely.

USA has an antiquated GRID with no solar flare protection to prevent a potential national catastrophe no HVDC backbone to stabilize fluctuating RE power across the continent and no SMARTGRID matching of demand and supply.

Europe and China is planning infrastructure strategically. US government should protect the nation and do the same.

The US wind energy cluster is competitive and wind LCOE could follow the same trajectory as PV LCOE due to great advances in materials science and generator designs without rare earth minerals. USA needs wind energy to run a competitive economy in the northern hemisphere diurnally and seasonally PV power fluctuations.
Peter Bradshaw
Peter Bradshaw
May 27, 2012
#10 says "Home owners are driving the market" but the California data belies that. The data available on the CalSolarInitiative web site

http://www.californiasolarstatistics.ca.gov/reports/agency_stats/

shows that the residential installed capacity is 332MW, while the non-residential amount is 502MW. The pending installations show an even bigger non-residential proportion, 67MW to 286MW.

Let us hope that the tariff bickering does not slow down the rate of installation.
Jens Stubbe
Jens Stubbe
May 27, 2012
#7 solar energy has to lower cost considerably and to do this there has to be open markets. Home owners are driving the market currently. It is in the interest of everybody that the solar industry keeps its momentum. This is why it is a pity that government protect shareholders in US PV companies in stead of viewing the transition from fossil to renewable as a strategic necessity. There is no quick fix that will make US PV industry competitive or able to scale to meet the demand increase in a renewable energy future. Chinese PV industry is 10 times larger than US PV industry and growing fast. Putting up a price umbrella on vague grounds is wrong and will not save US pv manuacture jobs.

#8 China has real infringement issues in many other business sectors (also mentioned by #5) and as USA is buying a whole lot more in China than the reverse and could become justifiable angry and hit back hard. A lot of contract work is done for US industrial giants that could easily be moved to other countries so I think it is unwise for China to escalate conflict.

#5 Denmark have been at war with all our neighbors and have occupied huge parts of Europe. Germany and Sweden have invaded us and Britain attacked us twice. This violent past also included piracy, slave trade and absolutely unfair trade wars before we finally decided that peace, trade, human rights, democracy and collaboration create wealth.

Despite Carter, Gore, Schwarzenegger and other good americans the bulk of US direct and indirect government subsidies consistently went to fossil and nuclear energy. Obama has invested $8 billion in nuclear and the Iraqi embassy employs 15.000 - a stark contrast to the puny and unreliable support for RE. US was for decades leading in RE innovation but never pursued the market for real, but now China is doing it US decides to put a stick in the wheel.
Gary Richardson
Gary Richardson
May 26, 2012
Continuing on with my previous comments, I ask, why haven't we started looking at how much available "non conflict and reliable output" real estate we really have to utilize for PV, how much can be generated per sq mile, divide by less than 25 to reflect reasonalbe replacement rates, and see how much positive impact can be made against other energy dense sources. Albeit, there is alot more to cover than these figures but at least go with this as partial basis of understanding.
Gary Richardson
Gary Richardson
May 26, 2012
@jens
Why do you believe China is unwise?
Please be specific about your reasons.
Foolish to trust?

Also, PV Installation job stimulus?
I'm a union member in the International Brotherhood of Electrical Workers (IBEW) and I don't see my fellow brothers too excited about PV installation jobs. Sure there is a surge in hiring but once installed, there is a 25 year cycle minus minor maintenance and warranty issues before installing again. Also, there is too little concern over the possiblity that the panels will not last as advertised and then having to pay for a PV installation bubble. As a result, be watchful of those taking too much credit for installation job stimulus at the expense of sustainable employment or promising 25 year lifecycle at the expense of increased taxes to bail out a fiasco.

Also, ask yourself this: How much evidence can you find of nations investing in our treasury also investing in our insurance industry?
Gary Richardson
Gary Richardson
May 26, 2012
@jens and eystein

I disagree and believe you are over reacting.
These tarrifs are only meant to be temporary measures to ensure fair play and peace.
There are indications of "I want what the American's have" resentful attitude brewing over there and all that does is close peoples eyes. I don't know how true that is and to what extent but I know in my heart that I wish for fairness. I also am concerned about buying the "American dream" lifestyle if I cannot pay it back sometime in my life.
Gary Richardson
Gary Richardson
May 26, 2012
Amen to that #5

China would have to present enough evidence to compel an investigation like we did. However, I believe the difference between us is we did legitamately advance polysilicon production enough to sell it for less and not use unfair subsidies to monopolize that industry. Also, I have no desire to see China or any other countries fail. Therefore, one of my concerns is of an underlying anger directed unfairly toward us.
Mark Hagerty
Mark Hagerty
May 25, 2012
We are a PV installation company in Michigan. We have never used Chinese panels. Price is not the only consideration. Value is much more important than price. We cannot support the use of Chinese panels for several reasons, some of which are;
- China has demonstrated a complete lack of concern in regards to the quality, and safety, of the products they build. Stainless steel that rusts, kids toys with lead paint, mis-graded bolts that snap under load, pet food with antifreeze, drywall that gives off caustic fumes that ruins copper wire and pipes, etc., etc..
- China has a complete disregard for international patent laws. They produce knock offs for every quality brand our country produces. Companies that have invested everything to build a brand have to sit back and watch the Chinese government look the other way.
- China has taken over almost every manufacturing industry that has built our country. If it was done on fair footings it would not be so bad, but the conditions their workers live with and they pay they receive, is inhumane at best.
- Solar panels have a twenty-five year warranty. Why would anyone trust a company in China to honor a warranty such as this when they don't even honor patents?
- How can people support converting our reliance on foreign oil, to a reliance on the Chinese for renewable energy?
These are just a few of the reasons we believe people need to look at the big picture and not just their immediate gratification.
ANONYMOUS
May 25, 2012
Chinese manufacturing is notoriously inefficient and according to various studies, uses far more energy and resources for equivalent quality and output. Given this, even with lower labor costs (and that is changing rapidly), the only way the Chinese manufacturing sector can make a profit is by eliminating the competition. This is done by selling low cost with high government subsidies to strangle competitors and is a common tactic in China, even against other Chinese companies.

In the end, there will be only the company (usually a state run company) that has the most government support. Through stupidity, the American government allows it's own companies to fail and then complains loudly as in the strategic metals area.

This time, the Americans acted wisely but slowly to an obvious threat to their manufacturing base. The Chinese complain loudly even though this problem of solar manufacturing dumping product is well known and discussed in China. The rest is all face saving but makes the Chinese look ludicrously stupid.
Eystein Hansen
Eystein Hansen
May 25, 2012
#2 you have a point that the populist does not mind the conflict. I also agree that it will add cost to projects in America.

But the way I see it is that the american market even with added cost would survive, as it is currently in a state of booming and the price is below grid parity in some cases. More importantly the developers of projects have good margins and can afford to cust back some on the margins.

The same cannot be said for the chinese industry with allready deeply cut margins.

Thats why I mean China have more to loose on pushing forward with even more trade blockades. What if the EU answer with another tariff? What if Japan do the same?

The sad part about this is that China has done a fantastic job with making solar a viable energy source for the future. And now populistic elements in american politics are trying to destroy this with the tariff. I suspect lobbying did its part..

I am optimistic for China and I think they can prevent the tariff from hurting them too much. I agree with what many downstream chinese companies have said that this is now a global industry.

One more thing I recently read that Chinese industry sources claim to have proof of dumping of polysilicon for contract players, but what about the ones that are selling purly on the spot marked? And how will they even compare FBR costs when there is no chinese FBR production. (Granted GCL is researching it but they are not yet there.)
Jens Stubbe
Jens Stubbe
May 25, 2012
#1 i do not agree entirely. I think China is unwise. USA decided on the foolish and totally unfair 31% anti dumping tarif. Escalating conflict will not remove the tarif because the roots of the tarif is nationalistic protectionism.

The populist behind the illegitime tarif dont mind conflict. They dont care that they have added cost to american home owners who want solar energy and have slowed job creation among companies that install and service home PV installations. And they dont consider that putting a tarif upon China will only slow them for a while.
Eystein Hansen
Eystein Hansen
May 24, 2012
How will China make a case for polysilicon dumping? The WTO will not sanction illigal dumping charges.

If China pushes through with dumping charges there is a chance they will end the same fate as the American steel tariff of 2002 ended in 2003?

Is there any evidence of dumping?

And finaly more importantly, is it in Chinas interest to make a tariff on the polysilicon? It would probably cause higher manufacturing costs for all Chinese based producers of wafer/cell/modules as the wafers would increase in cost if the polysilicon increased in cost. The way I see it China got a very good grip on the industry right now, and can easily be domininating if they keep focusing on low costs and higher efficiency.

Like a game theory text book case, does not everyone loose in escalating trade wars? Especially where both sides are mutually dependant on each other. In this case it seems to me China have more to loose than America. (Bigger industry, increased costs if continuing trade war etc.)

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Steve Leone

Steve Leone

Steve Leone has been a journalist for more than 15 years and has worked for news organizations in Rhode Island, Maine, New Hampshire, Virginia and California.
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