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US boosts duties on Chinese solar imports

By Dana Hull, San Jose Mercury News –

SAN JOSE, Calif. — The U.S. Commerce Department on Wednesday slapped big duties on solar panels imported from China, the latest decision in a highly politicized trade case.

The Commerce Department investigated two issues — illegal subsidies and illegal dumping — in separate but parallel proceedings. In March, it set duties ranging from 2.9 percent to 4.7 percent in the subsidies portion of the case, which were lower than many had anticipated. But on Wednesday, it revised those figures sharply upward, to 14.78 percent for U.S. imports made by China’s Suntech and 15.97 percent for imports made by China’s Trina Solar.

The department chose Suntech and Trina Solar as “mandatory respondents” in the trade case, as they were the two biggest exporters during the period of investigation, which covered all of 2010.

The “illegal subsidies” duties are not the only ones imposed on the Chinese companies.

Complaining that Chinese manufacturers are illegally “dumping” their products in the United States and putting U.S. manufacturers at a competitive disadvantage, the Commerce Department in May slapped preliminary tariffs of 31 percent on Chinese solar cells and panels. On Wednesday, they basically reaffirmed those percentages, calling for anti-dumping duties of 31.73 percent on imports from Suntech, 18.32 percent from Trina Solar and 25.96 percent from other Chinese companies.

Suntech now faces combined tariffs of 46.51 percent.

The highly contentious trade case began last year when a group called CASM, or the Coalition for American Solar Manufacturing, filed a petition claiming that Chinese solar companies benefit from enormous subsidies like free land and low-interest government loans and are illegally dumping solar cells in the United States, driving American companies out of business. CASM is largely led by the American arm of Germany’s SolarWorld and a small coalition of U.S. solar manufacturers.

When Fremont, Calif.-based solar maker Solyndra filed for bankruptcy, fierce competition from China was cited as a key factor in the company’s implosion. Evergreen Solar also blamed China when it laid off 800 workers and shut down its plant in Massachusetts.

SolarWorld, which shuttered its California plant last year, now manufactures in Oregon. Its aggressive stance against China has put it at odds with many other players in the solar industry who argue that ever-lower panel prices are good for U.S. consumers and are driving the rapid adoption of solar on homes and businesses across the country while creating thousands of installation jobs.

A group called CASE, or the Coalition for Affordable Solar Energy, was formed to oppose the trade petition. CASE members include fast-growing startups, such as SolarCity, SunRun and Sungevity, that install solar panels, including panels made in China.

Last year, imports of solar cells from China were valued at about $3.1 billion, according to the Commerce Department. That was up from $1.5 billion in 2010 and just $640 million in 2009.

The ruling covers imports of solar cells produced in China and solar panels made in China that use Chinese-made solar cells. It also covers solar panels made outside of China that use solar cells produced in China.

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