ESIA: U.S. Launches Photovoltaic Trade Fight Both ignorant and hypocritical

solarF.net News Recently, several photovoltaic companies in the United States “grouped” to file a lawsuit against the US Department of Commerce and the US International Trade Commission, accusing the Chinese government of providing billions of dollars in unfair subsidies and cash subsidies and tax deductions for the solar industry.

These companies require the U.S. government to impose "more than 100%" punitive tariffs on solar panels imported from China. Since 95% of solar panels produced in China are exported and a large part of them are exported to the United States, once the US government approves this request, China's Solar Panel makers will face a heavy blow. The total value of solar panels that China exported to the United States alone this year reached nearly $2 billion.

However, I have heard hypocritical temperatures in the Solar Alliance lawsuit led by Solarworld, because US solar companies also receive huge subsidies from the US federal government, state government, and local governments.

Solyndra, a recently bankrupt solar panel maker, received more than $500 million in loan guarantees from the federal government. SolarWorld also received a $4 million R&D fund from the federal government. Last year, the total federal government subsidy for the solar industry exceeded $1 billion.

In fact, both the United States and China’s solar industry benefit from government assistance. The reason why this is happening now is because China’s moves are more successful.

There is a strong political scent behind this lawsuit. At present, the United States is in an economic crisis. Because there is no practical way to stimulate the economy, American politicians need to find a scapegoat. As a result, China has unfortunately become their thorn in the eye.

The reason why the US Solar Manufacturing Alliance dared to initiate trade lawsuits was largely supported by US politicians. They accused China of being a “swindler” and doing “rogue behavior”. Given that the US economic slump will not turn around in a short period of time, protectionist sentiment against China will continue to spread and expand into other industries, especially next year’s US presidential election.

History has proved that the practice of trade protectionism is very problematic. The American solar energy industry will swallow the bitter fruit and become the biggest loser.

The export of solar panels in China caused the price of solar panels to fall from US$3.30 per watt in 2008 to US$1.15 per watt, a drop of 65%. The continued decline in solar panel prices has greatly increased the interest of investors and public utilities in solar power generation, and eventually contributed to the formation of a US$6 billion solar market scale in the United States. It is very important that solar panels account for less than 40% of all solar power systems, and the other 60% consist of auxiliary equipment (steel structures and cables and installation and maintenance services), which are all completed by local companies. Not imported.

Therefore, when the cost of solar panels rises, it is not only foreign component manufacturers who are injured, but also local companies that provide auxiliary equipment and services for the solar industry.

Trade protectionism measures will also make the U.S. government take a lot of measures to reduce its dependence on fossil fuels. As the cost of solar power generation is still higher than that of oil and natural gas, the proportion of solar power generation in the total power generation in the United States is less than 1%. Rising prices will reduce the share of solar power generation, making the United States more dependent on oil and natural gas.

Even if the U.S. government approves this trade lawsuit, the anti-dumping duties will not cause much harm to China's solar industry in the long run. With the rapid development of solar power in the global market, Chinese manufacturers can develop new markets, including of course China's huge market. According to the targets set by the relevant Chinese authorities, China's solar power generation capacity will increase by 150% to 50GW in the next 10 years, and by then it will become the world's largest solar energy market.

For US solar energy companies, a more practical approach is to strengthen vocational training and increase the status of the US solar energy industry in the entire industry chain. Through investment services, it is possible to leave such services as design, construction, installation and maintenance in the country by importing inexpensive solar panels. This achieves a win-win situation.

Instead of setting up trade barriers, the United States should show true leadership and increase investment in this sustainable energy.