* Case clears first hurdle at U.S. trade commission
* SolarWorld says faces unfair competition from China
* Case could lead to broadening of import duties
* Installers say duties would push up cost of solar power
By Krista Hughes and Nichola Groom
WASHINGTON/LOS ANGELES, Feb 14 The United States
took a step on Friday towards potentially extending import
duties on Chinese solar energy products to also cover panels
made with parts from Taiwan in a case that could have a major
impact on the fast-growing U.S. solar market.
The U.S. International Trade Commission found there was
reason to think the imports could harm the local solar industry,
putting Washington on a path toward widening the reach of the
steep duties it slapped on products from China in 2012 and
potentially escalating a tit-for-tat trade spat.
The U.S. arm of German solar manufacturer SolarWorld AG
had complained that Chinese manufacturers are
sidestepping the duties by shifting production of the cells used
to make their panels to Taiwan and continuing to flood the U.S.
market with cheap products.
"Step by step, U.S. solar producers are returning to a day
when they no longer are forced to compete with the government of
China," said Mukesh Dulani, president of SolarWorld Industries
America, which makes crystalline silicon solar panels at a
factory in Hillsboro, Oregon.
SolarWorld said it had the support of other solar
manufacturers operating in the United States in pushing for a
broadening of the duties.
But the Coalition for Affordable Solar Energy, which
represents about 50 U.S. solar companies that mainly focus on
installation, said installers would suffer if there was another
jump in the cost of modules. CASE said those prices had already
gone up 10 percent since the complaint was filed on Dec. 31.
"By raising the cost of solar for American homeowners,
SolarWorld is poised to inflict critical damage on an industry
which last year added more than 20,000 solar installation,
sales, and distribution jobs to the U.S. economy," CASE
President Jigar Shah said in a statement.
Lawyer Richard Weiner, a partner at Sidley Austin who is
representing the Chinese solar industry, said SolarWorld was
trying to shut competition out of the U.S. market but did not
have the capacity itself to supply all the goods needed.
"We remain convinced that fairly traded imported solar
products from China and Taiwan are vital for America to continue
its shift away from fossil fuels," he said.
Taiwanese solar manufacturers have never engaged in dumping
practices in the United States, the Taipei Economic and Cultural
Representative Office in the U.S. said in a statement, adding
that prices on Taiwan-made solar cells are 8 percent above the
global average due to their "excellent quality."
The ITC's preliminary decision means the Commerce Department
will continue with its investigation into whether the products
are being sold in the United States below their fair value, or
if their manufacturers receive inappropriate levels of
subsidies. It could eventually suggest duties.
The department is due to make a preliminary decision on
subsidies from China on March 28 and a preliminary decision on
dumping on June 11.
The value of imports of solar products from China fell by
almost a third from 2012 to 2013, while imports from Taiwan rose
more than 40 percent, although from a much smaller base,
according to ITC data. Commerce Department figures show solar
imports from China were worth just over $2 billion in 2012,
while imports from Taiwan totaled $510 million.
China, which has criticized the United States over the new
investigation, has slapped anti-dumping and anti-subsidy duties
on imports of U.S. polysilicon, solar's key raw material.
China's solar manufacturers have taken over the global solar
market by offering cheaper modules than their peers, but the
glut of solar equipment has led to a pricing slump over the past
four years, throwing many companies into crisis.
U.S. solar installations were worth more than $13 billion in
2013, according to research firm GTM. About half the solar
equipment installed in the United States last year was made in
China. In the fast-growing rooftop solar market, that figure was
The U.S. solar trade group, the Solar Energy Industries
Association (SEIA), is against the trade litigation and has been
trying to get SolarWorld, Chinese manufacturers and the Chinese
and U.S. governments to settle the dispute. This marks a new
approach for SEIA, which in SolarWorld's previous trade case did
not take a public stance on the dispute.
Under the association's settlement proposal, Chinese
companies would agree to pay into a fund that would be used for
the benefit of U.S. solar manufacturers. The deal would require
China to revoke the restrictions on imports of U.S. polysilicon.
The group is seeing some "signs of progress" in its push for
a negotiated settlement, according to John Smirnow, SEIA's vice
president of trade and competitiveness.
"We're getting more interest from all of the key players on
having a negotiating dialogue," Smirnow said. "The next step is
actually having SolarWorld in the room with Chinese