Asia Report: Solar Trade Battles Brewing Between India, US, China

Renewable Energy World Editors
February 11, 2013 | 2 Comments

With solar trade tensions still high between the US and China, now there's another front in the competitive global solar marketplace -- the U.S. has formally filed a complaint with the World Trade Organization over portions of India's National Solar Mission that spell out domestic content requirements.

India has long been seen as the next major market for solar, and its government aims to add roughly 20 gigawatts (GW) of grid-tied solar energy in the next decade. That plan also included domestic content stipulations for solar cells and panels, initially excluding thin-film technologies (a big help to First Solar) but new proposals would close that loop.

Domestic content requirements are already under scrutiny, with the WTO ruling against such rules in Ontario. Some argue that there is middle ground for supporting solar at a national level without closing the borders. Others claim that India should become an active investor in solar technologies to help walk the "knife's edge"between manufacturers and developers. With India standing as one of the biggest market potentials for solar energy -- and thus solar industry supply-chain members -- this promises to be another heated debate.

Meanwhile, things are heating up again between the U.S. and China. The SolarWorld-led Coalition for American Solar Manufacturers (CASM) is now appealing last year's ruling that levied tariffs on Chinese suppliers, seeking to revisit the lower duty rates applied to several companies, as well as add criteria for cells imported to and assembled in China, and aluminum extrusions and rolled glass. European glass companies have filed their own antidumping complaint against Chinese rivals.

There are more than 10 solar trade disputes now ongoing at both a domestic and international level, notes Solarbuzz senior analyst Michael Barker. Their outcomes, he says, could "dramatically change the solar PV industry supply-chain, potentially creating separate zones in terms of supply and demand -- a risky prospect within an industry already struggling to reach supply/demand rationalization."

IN THE NEWS

Australian Wind Energy: Now Cheaper Than Coal and Gas: Wind is now cheaper than fossil fuels in producing electricity in Australia, the world's biggest coal exporter, according to data compiled by Bloomberg. Electricity from a new wind farm can be supplied at A$80 (US $84) per megawatt hour (MWh), compared with A$143/MWh from a new coal-fired power plant or A$116 from a new station powered by natural gas, including the cost of carbon emissions, according to Bloomberg New Energy Finance. Older, 1970s/80s-era coal-fired power plants can still produce power at lower than the cost of wind, they note.

Taiwan's solar cell output exceeds 5.5 GW: Taiwan's solar PV cell manufacturers shipped a record of nearly 5.5 GW in 2012, a 67 percent increase from 2011. EnergyTrend (a division of market research firm TrendForce) projects more record shipments in 2013 due to trade rulings affecting China and a surge in Japan's PV market.

Conergy Wins 31.5-Megawatt Solar Power Plant Orders in Thailand: Conergy will develop, supply and install three 10.5- megawatt plants in two provinces in western Thailand for a unit of Thai Solar Energy Company Ltd. The German company wants to increase its 10-percent share of Thailand's solar market.

Panasonic sets mark with 24.7-percent efficient solar cell: Panasonic has built a solar cell with record-setting 24.7 percent conversion efficiency, confirmed by Japan's National Institute of Advanced Industrial Science and Technology (AIST), the Nikkei reports [subscription required]. The company's commercially available solar cells offer 21.6 percent efficiency.

Japanese firm eyes ocean energy plant in Marshall Islands: Venture firm GEC Co. is proposing what would be the world's first commercial power plant to make electricity using temperature differences in seawater. The company is eyeing a 10-MW system online by 2017, seen as a better option for island regions near the equator lacking the land for solar projects and with insufficient winds for power generation.

ON THE HORIZON

Hydro Tasmania Plans Remote Power Projects, Broader China Links: Hydro Tasmania is considering developing renewable energy projects outside Australia's island state to supply power to remote non-grid-connected areas, as the company looks to expand its partnership with a unit of China's Shenhua Group Corp. Mining companies in particular are attractive targets in remote area power supply, according to company CEO Roy Adair.

Japan Banks Ante Up to $19 Billion Solar Market: Japan's biggest banks are following Goldman Sachs into domestic solar-power projects, anticipating an eightfold increase for investments in the industry over the next three years. Thanks to its aggressive subsidy program (which is currently being reevaluated), Japan is expected to become the third-largest global market for solar power in 2013, behind China and either the U.S. or Italy.

IN CASE YOU MISSED IT

Jan. 23-Feb. 5, 2012 Asia Report: India Scales Back Subsidies, What it Means for Solar

Jan. 11-22, 2012 Asia Report: Reacting to China's Goal of 49 GW of Renewables in 2013

Dec. 18-30, 2012 Asia Report: China Solar Shares Soar as Government Bails Out Sector

Dec. 11-17, 2012 Asia Report: India Hopes to Ramp Up Installed Solar Capacity to 9 GW by 2017

Dec. 4-10, 2012 Asia Report: India's Wind Power Capacity Expected to Balloon by 2020, Says GWEC

Nov. 27-Dec. 3, 2012 Asia Report: China Dominates 2011 Global Wind Installations

Nov. 20-26, 2012 Asia Report: Another Week of Woe for China's Solar Panel Manufacturers

Nov. 13-19, 2012 Asia Report: Australia Lays Out 2050 Renewable Energy Vision

Nov. 3-12, 2012 Asia Report: Panasonic Freezes Investment in Malaysia PV Manufacturing

Lead image: Whitetail deer bucks, via Shutterstock

2 Comments

RobX Miller
February 14, 2013

China already won the Solar Trade Battles because they control Silver that is required to manufacture. The US CME and CFTC failed to allow a couple of 'too big to fail' banks corrupt the trading in the US. Discussing PV manufacturing with out discussing Silver is completely pointless. US Solar manufactures will loose heavily due to the outright market manipulation of trading paper silver contracts that are not backed by physical silver. China produces 23% of the world's silver and was the largest exporter until mid 2012. Now China is the largest importer of silver. China, Australia, and the Swiss have just opened a competitive Silver Exchange due to the outright corruption recognized by the industry and traders. The lawsuits and allegations are that the CFTC allowed non-transparent secret propitiatory trades of paper silver contracts in the US ETF market. The CFTC has an ongoing 4 year investigation into this corruption where a couple of companies manage the prices. Despite public concerns, the investigation can never see the 'light of day' (pun intended). The GSA predicts that silver will be earth's first element to be depleted over the next few decades. Both US and Canada mints ran out of silver coins in Jan 2013. There are no new silver mine discoveries of any size to meet the PV demand. At the 2012 mining convention, all mines are reporting lower-grade ore. As a political leader in England stated in last weeks broadcast, the Asians must be laughing their socks off as the Western countries are giving it all away, and they didn't have to lift a finger. Wishful thinking of the PV industry is overshadowed by the supply of an essential building material. Investors need to dig deeper than just the good intentions and market demand. Until the US cleans out the market and recognizes silver as a strategic element, the future of PV manufacturing is extremely risky.

E.V.R. Sastry
February 13, 2013

It is unfortunate that the US has chosen to file a complaint against India with the WTO. When its PV manufacturing industry was being decimated by low cost imports from China, the US initiated action unilaterally to impose anti-dumping duties on Chinese products. India caused no such injury to US industry. On the contrary, Indian PV industry itself has suffered badly in the last 2-3 years due to imports from China and the US. Many companies are operating at low capacity utilization levels and some have shut down altogether. Does the US want to kill whatever is left of the Indian PV industry?

The fact is that the domestic content requirement of the National Solar Mission (NSM) regulates less than half of the total Indian PV market. Major states such as Gujarat, Karnataka, Andhra Pradesh and Tamil Nadu have their own programs which are fully open to imports of all types of modules. Even within NSM, thin film modules faced no restriction so far and First Solar has perhaps been the largest supplier of thin films to India. So what is the US complaining about? It seems the action is intended only to pre-empt any tightening of the requirements for the second phase of NSM.

A lesser known fact is that US companies have shown little interest in developing the Indian PV market or in investing in manufacturing facilities in India although the policy fully allowed imports and investments for two decades now. Even today, barring SunEdison, there is no major US developer active in India and no major EPC company either.

Finally, if PV has to grow, it has to grow all over the world. Manufacturing cannot be the monopoly of any one country.

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Renewable Energy World's network editors help deliver the most comprehensive news coverage of the renewable energy industries. Based in the U.S. and the UK, the team is comprised of editors from Pennwell Corporation's myriad of publications...