The Commerce Department announced Tuesday it will impose small import duties on Chinese-made solar cells, disappointing a handful of U.S. solar panel makers who complained of being undercut by subsidized Chinese firms and who wanted stiffer penalties.
The Commerce Department set preliminary countervailing duties for subsidized Chinese firms at 4.73 percent for Trina, 2.9 percent for Suntech and 3.61 for all others.
The decision was hailed by U.S. companies that install solar panels and U.S. companies that export solar manufacturing equipment. Investors also welcomed the news; Suntech’s shares soared 14 percent and Trina’s jumped 7.85 percent.
But the manufacturers who brought the case said they still hope that higher tariffs might be added in mid-May for separate dumping allegations.
The case has split the U.S. solar industry. SolarWorld, a maker of solar panels, led a group of seven manufacturers in a bid to persuade Commerce to “halt . . . an ever-rising tide of heavily subsidized solar cells” from China that it said was putting U.S. firms out of business. Other solar businesses, however, opposed any duties, noting that they would make solar panels more expensive and hurt American consumers as well as workers who install the devices.
“The rates were very low, which is a huge victory for the U.S. solar industry and its 100,000 employees,” said Jigar Shah, president of the Coalition for Affordable Solar Energy, which opposes import tariffs. “On the topic of whether the Chinese government is systematically oversubsidizing its solar industry, they were found not guilty.” He said the decision would not significantly raise the price of solar panels.
The Commerce Department will review the countervailing duties later this year. Meanwhile, companies importing solar panels made in China will have to put money in escrow until the duties are final. Moreover, the duties are retroactive for 90 days.
The Commerce ruling also closed a key loophole, said Timothy C. Brightbill, a lawyer at the firm Wiley Rein who represents the U.S. solar panel makers. Commerce said its duties apply to Chinese solar cells regardless of where they are assembled into larger panels or modules. Chinese companies had publicly discussed circumventing tariffs by assembling panels in third countries.
Brightbill said he hoped that the Commerce Department would raise the countervailing duties when it reviews them, but Shah said it was rare for the department to raise duties after setting a preliminary level.
Brightbill also said that an investigation into anti-competitive factors in Chinese glass manufacturing could later add to the import duties because glass is a key component in solar panels.
“Today’s announcement affirms what U.S. manufacturers have long known: Chinese manufacturers have received unfair and WTO-illegal subsidies,” Steve Ostrenga, chief executive of Helios Solar Works in Milwaukee, said in a statement. Helios is a member of the group that brought the trade complaint.