Federal research lab concludes China’s costs to produce and deliver solar to US market exceed those of US producers08. February 2012 | By: CASM
Analysis dispels faulty assumption that Chinese manufacturers enjoy cost advantage.
The Coalition for American Solar Manufacturing (CASM), a group of seven U.S. solar manufacturers representing more than 150 employers of more than 14,650 workers, is heralding a revised research presentation from the National Renewable Energy Laboratory, posted on the NREL website today. The presentation concludes Chinese production of crystalline silicon solar technology for the U.S. market costs more than U.S. production for the domestic market, when the costs of shipping are included.
CASM contends the findings validate its position that the Chinese solar-manufacturing industry enjoys no cost advantage in solar production costs but, rather, benefits from a government-underwritten export campaign to injure competition from U.S. manufacturers. At least 12 U.S. manufacturers have suffered layoffs, plant shutdowns or bankruptcies over the past two years. The coalition supports petitions that SolarWorld filed Oct. 19 to seek anti-subsidy and anti-dumping duties on Chinese imports.
The NREL presentation, “Solar PV Manufacturing Cost Analysis: U.S. Competitiveness in a Global Industry,” concludes that Chinese producers have an inherent cost advantage of no greater than one percent, compared with U.S. producers. However, when trans-ocean shipping costs are counted, Chinese producers face a five percent cost disadvantage, according to the analysis (slide 26). “Massive government subsidies,” the government says, sponsor the Chinese industrial drive to export about 95 percent of domestic production, a campaign that has already seized 55 percent of global market share, according to NREL (slides eight and 20).
“This analysis from the renewable-energy research arm of the U.S. government corroborates our view that an export drive sponsored by the Chinese government is improperly intervening in the U.S. market,” said Gordon Brinser, president of SolarWorld Industries America Inc., based in Oregon. “Highly efficient U.S. producers like SolarWorld can vie with any company in the world in legal competition. But the government of China’s illegal trade practices are neither economically nor environmentally sustainable for anyone. Free trade is trade free of illegal foreign government intervention.”
“We are countering the illegal trade practices of China and its state-sponsored industry only as a first step to reviving renewable-energy competition, manufacturing and jobs and augmenting national energy security and world environmental stewardship,” Brinser said. “All of the advantages of solar should be available to the United States and to the competitive U.S. industry that pioneered this technology.”
On Dec. 2, the ITC issued a unanimous preliminary determination that Chinese trade practices are harming the U.S. domestic solar manufacturing industry. The next step in the trade case will be Commerce’s March 2 preliminary anti-subsidy determination. On March 27, Commerce is scheduled to make its preliminary anti-dumping determination on whether to impose duties to offset the effects of Chinese import pricing at artificially low prices.
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