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US Department of Commerce Ignores WTO, Imposes Preliminary Anti-Dumping Tariffs of 26-165%

china solar panelsThe global solar trade wars are myopic at best, and downright criminal at worst. Various countries around the world have been working to bring down the cost of solar power, and that has happened at a very good clip. Chinese solar cell and solar panel manufacturers have been very helpful, bringing the costs to record lows, and they have likely received a bit of support from the Chinese government. The US government and other governments have also supported their manufacturers. Yet, under bankruptcy threat, a handful of no longer competitive solar manufacturers in the US and Europe instigated efforts to put anti-dumping tariffs on Chinese technology. The results haven’t been pretty.

Without any legitimate willingness to compromise on the topic, the trade attack has gone on for a few years now. In response, China has started its own attack on polysilicon imports from the US (and South Korea). Recently, the World Trade Organization (WTO) came out and stated that the US tariffs on Chinese solar modules, steel products, and other exports were inconsistent with obligations under the 1994 Marrakesh accord. Nonetheless, the US Department of Commerce has just imposed preliminary anti-dumping tariffs on solar cells and solar modules produced in China (or Taiwan). The tariffs range from 26-165%.

This is on top of anti-subsidy tariffs imposed on such products about one month ago. The anti-dumping and combined anti-dumping + anti-subsidy tariffs for some specific Chinese companies are as follows:

  • Yingli, Canadian Solar, Hanwha SolarOne: 42.33% / 47.27%
  • Trina Solar: 26.33% / 29.30%
  • Wuxi Suntech: 42.33% / 49.24%
  • Companies not named due to “adverse facts” (for example, for not cooperating with the investigations): 165.04% / 197%

The final ruling will come around December 16th, 2014, and an International Trade Commission confirmation around January 29th, 2015.

Overall, GTM Research projects that these penalties on Chinese solar products will result in an increase in cost of about 14%. Needless to say, solar power installers in the US are not happy with these tariffs. Given that they make up the bulk of the 120,000+ solar jobs in the country, this has been a hotly opposed target. The leading company behind the tariffs is Germany-based SolarWorld, which has some manufacturing facilities in Washington state.

I do understand the point of anti-dumping tariffs. If a company or country artificially lowers the price of a product without actually lowering its costs and it kills off competitors that are actually have more cost-effective products, it can stifle technological and manufacturing advancement in the country. However, practically every major country in the world has supported its solar manufacturers, in a variety of ways, and at this point in the fight against global warming, what we need is a global effort to bring down the costs of solar (which is going to happen most as manufacturing scales up). What we don’t need is countries fighting companies from other countries in order to protect a few vested interests and their lobbyists.

Image: China solar panels via Shutterstock

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