US imposes new import duties on Chinese solar products

America imposes duties after ruling the panels were made using Chinese government subsidies, in the latest solar trade spat between the nations

PUBLISHED : Wednesday, 04 June, 2014, 2:27pm
UPDATED : Thursday, 05 June, 2014, 4:57am

The United States has slapped new import duties on solar panels and other related products from China after the Department of Commerce ruled they were produced using Chinese government subsidies, potentially inflaming trade tensions between the two countries.

The US arm of German solar manufacturer SolarWorld filed a petition complaining that mainland Chinese manufacturers are sidestepping duties imposed in 2012 by shifting production of the cells used to make their panels to Taiwan and continuing to flood the American market with cheap products.

The new complaint seeks to close that loophole by extending import duties to also cover panels made with parts from Taiwan.

In a preliminary determination, the commerce department imposed duties of 35.21 per cent on imports of panels and other products made by Wuxi Suntech Power and five affiliated companies, 18.56 per cent on imports of Trina Solar and 26.89 per cent on imports from other Chinese producers.

China's Ministry of Commerce expressed its "strong dissatisfaction" with the US decision to impose the tariffs.

In a notice posted on its website, the ministry said the US had "ignored the facts" and abused trade rules to protect its own industry, adding that the use of trade measures "would not solve the development problems of the US solar industry".

China retaliated against the original US duties by introducing anti-dumping and anti-subsidy duties on imports of American polysilicon, the key raw material in solar cells, and has accused the US of trying to curb Chinese imports.

About half the solar equipment installed in the US last year was made in China.

In the US, the complaint pitted SolarWorld Industries America, which makes crystalline silicon solar panels at its factory in Hillsboro, Oregon, against US solar companies that mainly focus on installation and that say import duties will only push up the cost of solar power.

"The ruling is a major setback for the entire US solar industry, because it will immediately increase the price of solar power and cost American jobs in one of fastest-growing sectors of the US economy," the Coalition for Affordable Solar Energy said.

The Solar Energy Industries Association said SolarWorld and Chinese manufacturers should try to settle the dispute before the industry was hurt.

But SolarWorld said it is not fair that Chinese solar producers benefit from government aid from their own country, including discounted loans and free utilities, making it hard for US firms to compete.

Last year, Chinese imports of the crystalline silicon photovoltaic cells covered in the complaint, which typically form the basic element of solar panels and modules, were valued at an estimated US$1.5 billion, the commerce department said.