U.S. Tariff on Chinese Solar Panels

Written By Brianna Panzica

Posted March 21, 2012

On Tuesday, the U.S. Commerce Department announced a tariff on Chinese panels after a preliminary decision that Chinese solar panel production companies have been receiving unfair subsidies.

The tariffs are set between 2.9% and 4.73%, matching the subsidy levels of Chinese companies.

China exports roughly 95% of its solar panels to nations that offer more incentives and better markets.  The low costs of these panels have been hurting U.S. companies that can’t keep up with the competition.

But trade relations have been tense between China and the U.S., both in regards to solar panels and China’s tightening control of rare earth minerals.

Luckily, the Chinese media did not respond negatively to the tariffs, noting that tariffs were lower than expected.

Chinese Premier Wen Jiabao has also recognized the problem:

“We will prevent blind expansion in our capacity to manufacture solar energy and wind power equipment.”

But New China New Agency commentary says that the U.S. should work to keep trade relations decent:

“The U.S. government’s lighter than expected tariffs on China’s solar panel imports reflects some degree of rationality, but it has to do more to keep bilateral trade ties from derailing.”

In May, the Commerce Department will decide if China is unfairly selling panels below reduction cost.  This could lead to a change in the tariff, especially considering it’s based only on a preliminary decision.  For now, however, it will remain below 5%.

Jigar Shah, president of the Coalition for Affordable Solar Energy, foresees danger in a possible tariff increase:

“…tariffs large or small will hurt American jobs and prolong our world’s reliance on fossil fuels. Fortunately, this decision will not significantly raise solar prices in the United States.”

The low prices are beneficial for the greater purpose of alternative energy expansion.  But they could be harmful to U.S. companies and those they employ.

That’s all for now,

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