Solar giants join forces in quest for tariffs, survival

Source: Christa Marshall, E&E News reporter • Posted: Friday, May 26, 2017

SolarWorld Americas is joining Suniva’s advocacy in favor of solar tariffs, putting most of the U.S. solar manufacturing industry’s heft behind a plan that could start a global trade war.

Previously, SolarWorld had said it would stay out of Suniva’s petition to the International Trade Commission to enact tariffs.

Suniva, which filed for bankruptcy last month, said it couldn’t compete in the U.S. solar manufacturing industry because of a flood of cheap cells primarily from Asia.

In a statement today, SolarWorld said it decided to become a co-petitioner with Suniva because the U.S. solar marketplace remains “highly distorted by state-sponsored overcapacity” and cheap exports from China and elsewhere.

“We have hoped and waited for serious proposals for settling the overall U.S. solar industry’s trade tensions with China, but we have received none,” said Juergen Stein, president of SolarWorld Americas. “Therefore, we have decided to join the case to pursue the best remedy available to us to restore fair competition in the U.S. market.”

The U.S. solar industry can’t afford to cede the future of renewable manufacturing industries and allow a mass loss of jobs, he said.

“Suniva welcomes SolarWorld to this important battle,” added Matt Card, Suniva’s executive vice president of commercial operations. “Without a global safeguard, the U.S. solar manufacturing industry will die.”

Timothy Fox, vice president at ClearView Energy Partners, a consultancy, said SolarWorld’s move was significant because the 1974 Trade Act stipulates a petition must come from an entity that is “representative of the industry.”

“This may have proven difficult for Suniva as a sole company with a comparatively modest market share of domestic solar cell and module manufacturing, but each incremental solar firm that joins the petition reinforces its potential to be representative of the industry,” Fox said.

SolarWorld Americas is the largest U.S. crystalline-silicon solar producer. Earlier this month, its parent, SolarWorld AG, filed for insolvency (Greenwire, May 11).

SolarWorld Americas is likely trying to avoid the fate of its parent company by joining the petition, said Max Halik, a research associate at Lux Research.

Earlier this week, the company, which operates a large manufacturing center in Oregon, warned of layoffs of “significant size.”

Will Trump weigh in?

SolarWorld was the lead petitioner in an earlier trade case that led to the Commerce Department slapping countervailing and anti-dumping duties on Chinese and some Taiwanese solar manufacturers five years ago.

The petition with Suniva under Section 201 of the Trade Act of 1974 is much broader, as it could affect the global industry rather than specific countries. It requires proof of “a substantial cause of serious injury.”

Fox didn’t rule out President Trump supporting Suniva and SolarWorld’s claims. “President Trump’s general indifference towards renewable power could encourage him to pursue strong trade action. Politically speaking, [Trump] can probably afford to lose a fight on solar products,” Fox said.

The ITC gave notice earlier this week it would consider the petition, making it likely Trump will weigh in on the issue in November (Energywire, May 24). The ITC said it would make a decision by September and forward its report to the president by Nov. 13.

The original Suniva request asked that tariffs of 40 cents a watt be placed on solar cells outside the U.S. The company pushed for a base import price of 78 cents per watt on foreign-made panels, which could lead to a doubling in their prices (E&E News PM, April 26).

Since then, solar companies — and analysts at financial giant Goldman Sachs — have warned that tariffs could spike prices and stifle demand for solar installations dramatically.

Solar Energy Industries Association CEO Abigail Ross Hopper said in a statement that the Section 201 case is about a sector of the solar industry, not just a particular company.

“The potential damage to the solar industry as a result of this petition could kill many thousands of American jobs and put a stop to billions of dollars in private investment,” Hopper said.

Bloomberg New Energy Finance analyst Hugh Bromley said the move is not entirely surprising, considering the similarities between SolarWorld and Suniva. Both companies rely on dated production lines with low levels of automation, he said.

“In essence, both firms are producing Cadillacs and wondering why they can’t compete against a Toyota Corolla,” Bromley said.