Solar panel fines could have ripple effect: experts

The US Department of Commerce on Tuesday issued its final finding on solar panels from the Chinese mainland and Taiwan, saying they were dumped in the United States with manufacturers offered subsidies from their respective governments.

Commerce said it will instruct US Customs to collect cash deposits from the exporters of the solar panels equal to the weighted-average dumping margins.

The department said solar panel products from the Chinese mainland were sold in the US at dumping margins ranging from 26.71 percent to 165.04 percent, and those from Taiwan have been sold at margins ranging from 11.45 percent to 27.55 percent.

The products from China received government subsidies ranging from 27.64 percent to 49.79 percent, according to the Commerce department.

If the International Trade Commission announces on Jan 29, 2015, a final affirmative determination - that there has been injury to the US domestic market caused by imports from the Chinese mainland and Taiwan - then Customs will require cash deposits for countervailing duties equal to the final subsidy rates, Commerce said.

If the ITC issues a negative injury determination, all cash deposits already collected will be refunded.

Wu Dacheng, secretary-general of the Solar Photovoltaic Committee of the China Renewable Energy Society, said that US government's decision is mutually disadvantageous for both countries involved.

"China's photovoltaic industry is massively buying equipment and materials from the US. The trade is two-way, so the damage will be made to both sides. You anti-dump me and I anti-dump you. Trade barriers are built and the prices will go up for both sides. It negatively impacts the promotion of photovoltaic products," he said.

"Today's decision by the U.S. Department of Commerce to further tax solar panels from China, even those with key components made in the U.S., will undercut the growth of American solar jobs, hurt the American solar industry and make it more difficult for solar technology to compete against fossil fuels. These unnecessary taxes inhibit competition and put upward pressure on solar panel prices needed by US homeowners, installers, and utilities," said Jigar Shah, president for the Coalition for Affordable Solar Energy, in a statement released after the Commerce released its decision.

"Taxing solar trade undermines both the spirit and efficacy of pledges made by the U.S. and China to work together in the battle against global warming," he said.

The year-long investigations of solar-panel dumping began after the US arm of German solar manufacturer SolarWorld AG filed a petition on Dec 31, 2013, saying that Chinese manufacturers were sidestepping 2012 import duties by taking production of solar products to Taiwan. The Chinese companies were also flooding the US market with cheap goods, the German manufacturer said, and they were being unfairly subsidized by the Chinese government.

"This is certainly suboptimal from the perspective of solar manufacturers in China as well as for project developers in the United States," said Michael Barker, senior analyst at NPD Solarbuzz.

"The argument against duties has been that the United States' downstream market - the people installing the systems - need to import components into the market and they're trying to do so at the lowest cost possible because they can be more competitive," he said.

Paula Mints, chief market research analyst at SPV Market Research, said that the real impact will be on the companies that install solar panels.

"On the demand side, they're going to see higher prices and that will hurt them because this entire industry runs on thin, little tiny margins. If you have any kind of any rupture or earthquake in terms of pricing of the components, it affects the demand side: the installers, the system integrators," she said.

In the last three years, imports of solar panel products from China have decreased to 33 million units in 2013 from 93.5 million units in 2011, according to the Commerce department. The value of the imports also decreased to $1.5 billion in 2013, from $3.1 billion in 2011. At the same time, imports from Taiwan increased in value to $656.8 million in 2013. from $256.6 million in 2011.

Lu Huiquan in New York contributed to this story.

amyhe@chinadailyusa.com