20 Mar 2012

Tariffs on China’s solar panels don’t change what’s needed from U.S. energy and industrial policies

Written by Jim Pierobon

Of all the assertions made by parties on both sides of the heightening debate about China’s subsidies of its solar panel manufacturing companies one reality should be more clear with each passing day:

At the heart of the race for solar manufacturing leadership are the shortcomings of  energy policies that could  help consumers invest more in clean energy and industrial policies that could help companies and industries commercialize new technologies and learn how to sell into new markets.  And while they’re at it, help coordinate investments where the success by one sector or company fosters success with others in a supply chain.

That, in a nutshell is not only what China is doing; to varying degrees, it’s also what Germany, Japan and certain other countries are doing for their economies and their environments. It appears that leaders in Congress and the Obama Administration need to get a grip and raise the U.S.’ game to compete more effectively — a LOT more effectively.

So today’s ruling out of the U.S. Department of Commerce’s International Trade Administration setting preliminary import duties on Chinese solar panels ranging from 2.9 percent 4.73 percent matters for appearances. But most likely it will be a mere blip on the solar radar screen. That would probably still be the case if the duties were significantly higher, which some analysts were expecting. The ruling is to be posted here.

 

 

 

 

These are three of the seven U.S. companies or U.S. affiliates that filed for tariffs on U.S. imports of Chinese solar panels.

Andy Hersh, an economist at the Center for American Progress is spot-on in asserting here that the U.S. “cannot win by just appealing to the referee” in trade disputes such as the one being addressed in the U.S. by the International Trade Commission and the Department of Commerce. Indeed, the U.S. has not settled any trade case with China since it joined the World Trade Organization in 2001.

Needless to say the complexities of this trade case have many dimensions. You can bone up on most of them here, courtesy of the Center’s Kate Gordon and Melanie Hart also at the Center for American Progress. You can find both sides reflected in three previous posts on TheEnergyFix here, here and here.

One of more of the Center’s recommendations you’ve probably read about before but they deserve repeating because we’re finding these scenario repeating itself through more of the U.S. economy. Indeed, the Obama Administration is moving to some degree on many of these fronts to the extent it can. There is also responsibility to be born by the states.

What the recommendations touch on are prerequisites for succeeding in global markets. What the U.S. and the states are doing now now is nowhere near enough. In the end, they will all pay a steep price for inaction.

  • Robust pursuit of fair trade practices
  • Demand-side policies to keep solar energy growing where it makes sense
  • A means to lower harmful emissions be it with a tax or cap and trade program as many established business leaders have called for
  • Modernization of basic infrastructure to allow businesses to collaborate and compete internationally
  • Investments in science and math education (thank you Exxon and Phil Michelson) and workforce development to equip U.S. workers to participate fully in an increasingly technology-driven economy
  • Finance policies to make more capital — public and private — available to innovators while bolstering a culture of entrepreneurship (ARPA-E is a good start)
  • Hone R&D policies to invest not just in basic research but also in the full cycle of innovation, from invention to development to commercialization.

A statement by the Coalition for American Solar Manufacturing here, led  by the three companies illustrated above, should be findable here.

A statement by the Coalition for Affordable Solar Energy, representing installers and integrators using Chinese solar panels, should be findable here.

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