Trade war over solar panels comes one step closer

  • Published on August 19th, 2017

Hearings for the much-hyped and controversial Section 201 trade case filed with the US International Trade Commission by Suniva and SolarWorld began this week, further raising fears that if Donald Trump is brought into the equation, tarrifs could be slapped on solar panels and the US solar industry may suffer.

By Joshua S Hill 

The first public hearings held by the US International Trade Commission (ITC) for the Suniva and SolarWorld Section 201 trade case were held Tuesday, with what was described by one ITC staffer as the largest crowd for a trade case he had ever seen. I’ve done my best to cover the lead-up to this week, ever since the ITC formally accepted the petition made by Suniva (and later joined by SolarWorld) in May and began an ‘Antidumping and Countervailing Duty Investigation’.

Since then, there have been several reports published highlighting the devastating impact such a case would have if Suniva and SolarWorld were found to be justifiably injured. The US Solar Energy Industries Association (SEIA) published figures claiming in June that showed if Suniva and SolarWorld were successful in forcing the US to place a tariff on all imported solar cells and to set a price floor for nearly every imported panel, the US solar industry could lose a third of its workforce, or approximately 88,000 jobs. This was followed quickly by research published by GTM Research claiming that a successful ruling in favor of Suniva and SolarWorld — companies which are both foreign-owned, and in bankruptcy — would devastate the US solar industry, risking up to two-thirds of solar installations expected over the next five years.

Earlier this month, however, an economic analysis conducted by global legal services provider Mayer Brown and published by Wiley Rein claims that a successful ruling in favor of Suniva and SolarWorld — deemed “an effective remedy in the Solar 201 Safeguard case” — would result in a net increase of over 1124,800 new jobs across all segments of the US solar industry. The study was conducted on behalf of Suniva and SolarWorld, raising serious questions about its legitimacy.

In response, Abigail Ross Hopper, president and CEO of SEIA, explained that “The notion that doubling the price of solar panels would somehow increase demand and create jobs is preposterous.” The SEIA also published its own pre-written statement that it presented to the ITC, in which it argued that Suniva and SolarWorld’s financial troubles were brought on by the companies’ themselves.

In the hearings on Tuesday, however, Matt Card, the executive Vice President of commercial operations for Suniva, said that, “As a country, we will have ceded manufacturing of the next meaningful source of electrical generation to China and its proxies in Southeast Asia and other global outposts,” adding that, “As we continue to stress the needs of energy independence as a country, the US, in fact, will have no control of its own destiny when it comes to power generation from the sun.”

Card was joined in his condemnation of foreign imports by Stephen Shea, formerly vice president at Beamreach Solar, another solar manufacturer which went bankrupt, who said that his company “was forced in Chapter 7 bankruptcy in large part because of the surge of low-cost imports.”

“Beamreach could not keep pace with the rapid reduction in prices driven by imports, first from China, then from countries like Taiwan, Vietnam, Malaysia, Korea, etc. and the resulting glut of product quickly destroyed the profit margins,” Shea added.

What is concerning at the moment is that the SEIA’s case is based around its belief that imported solar components are vital for the US solar industry to continue flourishing, and that, as mentioned, foreign-owned solar manufacturers brought their financial issues upon themselves. However, given that US President Donald Trump is already in the midst of applying and seeking to apply various tariffs on other imported goods from China and other countries — such as aluminium foil and steel — it raises concerns that the SEIA’s strategy may play right into Donald Trump’s hands. The ITC will likely aim to do everything it can to please the new Commander in Chief, and as the Administration has already revealed its hand, a desire to restrict international trade and imports in favor of jobs at home — good in theory, except that prices will soar across the board — there’s no guarantee that the ITC will rule against Suniva and SolarWorld.

“The Trump administration has given a very clear indication that [trade remedies are] are their preferred mechanism for protecting existing manufacturers and attracting investment into new US manufacturing — and we’re not the only ones,” one solar industry expert told GTM. “It’s not like this trade case is magically popping up because solar is in trouble; it’s because the administration gave a signal that this is something they would support.”

(Originally appeared at our sister-site, Cleantechnica.)

About the Author

Jeremy Bloom is the Editor of RedGreenAndBlue. He lives in New York, where he combines his passion for the environment with his passion for film, and is working on making the world a better place.