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Solar company head asserts China is endangering US industry
 
By: Daniel Cusick, Climate Wire - E&E
Published: February 6, 2014
 
The U.S. solar industry's phenomenal growth during 2013 -- marked by a 50 percent increase in solar power production -- has helped launch hundreds of small businesses and fueled surging employment in the solar sales, installation, and operations and maintenance sectors, according to industry officials.
 
Yet there is a glaring hole in an otherwise expanding solar pie, says the head of the nation's largest solar manufacturer, one created by the continued flood of inexpensive Chinese solar cells and modules into U.S. markets. According to U.S. government figures, imports of Chinese crystalline photovoltaic (PV) products to the United States were valued at $2.1 billion in 2012.
 
In an open letter to President Obama, Frank Asbeck, the chairman and CEO of German-based SolarWorld AG and its U.S. subsidiary, SolarWorld Industries America Inc., said the vision of a thriving U.S. solar industry is "in grave danger" due to "illegal trade practices [that] threaten to destroy any ongoing U.S. role in global solar-industry competition."
 
Asbeck also appealed to U.S. national pride in solar achievement, saying, "China is improperly seizing control of an industry that the United States invented, pioneered and grew."
 
"U.S. solar manufacturing should be thriving," the letter states, adding that U.S. firms remain among the most technologically advanced in the world. "Yet, China is destroying foreign manufacturing competition."
 
According to data compiled by Bloomberg New Energy Finance, U.S. solar module manufacturers saw their market share fall from 23 percent in 2009 to 11 percent in 2012, partly due to price competition from overseas. Over the same period, China's PV manufacturing market share exploded to nearly 71 percent, compared with roughly 40 percent in 2009.
 
"This drive has hurt and bankrupted dozens of well-run U.S. solar manufacturers and cost the jobs of thousands of U.S. employees," Asbeck wrote.
 
New U.S. dumping probe launched
 
The SolarWorld founder's comments follow recent reports that China's solar manufacturing sector is emerging from a difficult 12 months when a number of Chinese firms contracted or were forced into bankruptcy, including industry leader Suntech Power Holdings Co.
 
The hardships came as China's solar export market became overheated in 2012, leading to an oversupply of inexpensive photovoltaic cells and modules moving from Chinese ports into markets in Europe, Asia and the United States. And some Chinese manufacturers are still struggling, as evidenced by the recent struggles of LDK Solar Co. Ltd., which has failed to make interest payments to lenders since August.
 
At the same time, the Obama administration began taking steps to counter what a number of U.S. firms, including SolarWorld, charged were illegal subsidies by the Chinese government to prop up its solar industry and the widespread dumping of below-cost solar equipment into the United States. Since 2012, almost all Chinese solar equipment imported into the United States has been subject to tariffs of between 24 and 250 percent.
 
But the existing U.S. trade sanctions have had limited bite, critics say, because Chinese firms have continued to sell inexpensive PV cells and modules through subsidiary firms set up in other countries. Late last month, the Commerce Department and the International Trade Commission launched a new investigation into claims by SolarWorld that Chinese and Taiwanese manufactures are continuing to dump below-cost panels into the U.S.
 
Beyond its continued strength in foreign markets, China's solar industry is also getting a multibillion-dollar boost at home. In July, China's State Council said it would quadruple the amount of domestic solar power generation in the country to 35 gigawatts by 2015. In 2013, China added roughly 8 GW of domestic solar capacity, much of it in utility-scale projects.
 
Concerns about impact on growing U.S. market
 
According to recent reports, China's Ministry of Industry and Information Technology has called for consolidation of China's solar industry and technology standardization, which has been an issue for manufacturers. The government has also called for increased investment in developing decentralized solar power systems that could be used in areas without grid connectivity.
 
China has also imposed its own trade sanctions against foreign competitors, including the United States and South Korea. Last month, China's Commerce Ministry said it would impose a 57 percent tariff for five years on imports of U.S.-made polysilicon, a core ingredient in PV panels.
 
While SolarWorld and other U.S. firms, many of which are organized under the Coalition for American Solar Manufacturing, have pressed the Obama administration to increase the heat in its ongoing solar trade war with China, others have warned that such measures could work against U.S. solar firms by driving up prices for solar equipment and sending a chill through a domestic solar market that has just begun to show its growth potential.
 
In comments yesterday geared to the release of the Business Council for Sustainable Energy's latest "Sustainable Energy in America Factbook," Rhone Resch, chief executive officer of the Solar Energy Industries Association, touted an 80 drop in the costs of solar modules since 2008 as a primary driver of the industry's recent record expansion.
 
"This revolution is really happening before our eyes," said Resch, noting that the United States now produces roughly 13 GW of solar energy, enough to power 2 million average U.S. homes. The largest share of that growth came in the form of utility-scale projects, while the commercial and residential sectors accounted for 33 percent and 20 percent, respectively, of 2013 installed capacity, he said.