U.S. PUTS TARIFF ON CHINESE SUN

U.S. slams Chinese solar panels with new tariffs

James O’Toole (w/Parij Kavilanz), May 17, 2012 (CNNMoney)

“The U.S. Commerce Department announced stiff tariffs on Chinese-made solar panels…[It] could raise costs for consumers and further inflame trade tensions with Beijing…The preliminary ruling came as a result of a finding that Chinese solar cell manufacturers are ‘dumping’ their products on the American market below production costs.

“The issue has divided the U.S. solar industry, with some manufacturers complaining that Chinese trade practices are driving prices down artificially and smothering U.S. production. U.S. manufacturer Solyndra became the highest-profile victim of plunging panel prices last year, forced to file for bankruptcy despite receiving $535 million in federal loan guarantees…[O]thers in the industry say the complaint is counterproductive, given that most solar-related jobs in the U.S. are in fields like installation and sales that have benefited from cheap Chinese panels…”

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“The tariffs are two-tiered. The first comprises a group of 61 exporters, including Yingli Green Energy and Trina Solar, who face rates of roughly 31%...The second level encompasses all other Chinese producers not currently exporting to the U.S., who would be hit with a 250% rate should they begin doing so. This higher level was set in order to deter the 61 Chinese exporters named in the decision from attempting to duck the tariffs by shifting production to other companies…

“…[It is thought] that Chinese manufacturers would still likely circumvent the new tariffs by shifting solar cell production or procurement to Taiwan…The ruling will be finalized in the fall, and the Coalition for Affordable Solar Energy, an industry group opposed to the tariffs, said it would work between now and then to get the rates lowered…Shares of China's Yingli (YGE), Trina Solar (TSL) and Suntech Power (STP) fell…[and] U.S. panel makers First Solar (FSLR) and SunPower (SPWR) rose…The ruling comes at an already-tense time in U.S.-Chinese trade relations…[and] China could retaliate with a World Trade Organization complaint based on U.S. production of polysilicon, which is used to make solar panels…”

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