Solar trade remedies set by U.S. Department of Commerce determinations are weakened by Chinese solar producers who fail to show they are “free of Chinese government control,” Oregon-based SolarWorld argues in an appeal filed in an international trade court last week.
The move is the latest development in an escalating trade war between the U.S. and China. The U.S. International Trade Commission (ITC) last November unanimously determined that imports of crystalline silicon photovoltaic cells and modules from China materially injured the U.S. industry, clearing the way for the Commerce Department to issue antidumping and countervailing duties of between 31% and 250% on Chinese producers. In July, the Chinese Ministry of Commerce (MOFCOM) slapped provisional anti-dumping duties on imports of U.S. solar-grade polysilicon of between 53.3% and 57%.
SolarWorld, which leads the Coalition for American Solar Manufacturing (CASM), filed the October 2011 antidumping case finalized by the ITC determination. The coalition’s membership has grown from seven to 240 companies since the case was first filed. In an appeal filed with the U.S. Court of International Trade in New York, SolarWorld now argues that some Chinese companies failed to disclose Chinese government ownership and control, in some instances even failing to detail their ownership. In that light, SolarWorld claims, “these companies should not have received ‘separate’ antidumping rates, but instead should have been subject to a China-wide rate of 250%.”
The company notes, however, that the Commerce Department is investigating potential trade duty evasion and circumvention. “In particular, Commerce is investigating numerous Chinese producers who claim to use non-Chinese cells in their solar panels to ensure that their claims are accurate. Many Chinese producers have said they are legally avoiding the trade remedies by exploiting a loophole opened by Commerce when it determined that they could import solar panels duty-free if they fabricated the panels in their Chinese factories from solar cells manufactured in third countries.” SolarWorld is also appealing that so-called “scope ruling.”
The company’s brief additionally argues that the Commerce Department mistakenly set aside a U.S. Customs and Border Protection (CBP) ruling that determined the “proper classification” of aluminum frames used by one of the biggest Chinese producers in its solar panels. “By failing to use the proper classification … Commerce substantially undervalued the aluminum frames and therefore understated antidumping margins against all Chinese companies,” SolarWorld argues.
“U.S. costs to make and deliver solar technology for the U.S. market are lower than those of Chinese producers. Our better record of solar-equipment reliability, [research and development] and quality also is far longer. Moreover, we have the law—and history—on our side: Free trade is not trade without rules,” Gordon Brinser, president of SolarWorld said last week. “But to fairly compete, we need our federal trade-law enforcement system to show fortitude in applying that law.”
Brinser also said that CASM was “exhausting all avenues to engage well-established international trade law in countering China’s illegal trade aggression.”
According to the ITC, the U.S. has 14 crystalline silicon photovoltaic module makers, with about 1,900 employees in states across the nation. In 2011, U.S.-produced shipments of crystalline silicon photovoltaic modules were valued at about $790.5 million, while the nation consumed $3.01 billion worth of modules. About 57.4% of all consumed modules were imported from China, goods worth about $1.9 billion.
A study published in the Royal Society of Chemistry journal Energy & Environmental Science last week from researchers at the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL) and Massachusetts Institute of Technology (MIT) meanwhile suggests that U.S. solar panels can be produced at a “minimum sustainable price (MSP)” of $1.19/W versus $0.91/W for Chinese solar panels—representing a price advantage of 23% for a China-based manufacturer. The MSP represents the minimum price at which a company can sell its products while providing an adequate return for the company.
Sources: POWER, SolarWorld, NREL
—Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)