SolarWorld Americas comments on duties exemptions for competitors, SunPower

Immediately prior to SunPower’s announcement that it intends to acquire U.S.-based solar PV module manufacturer, SolarWorld Americas Inc., the latter commented in a 270-page document on how companies should act with regard to import duties.

Most noteworthy is the fact that SolarWorld Americas now supports the exemption of SunPower’s modules, which are produced in Asia,¬†from President Trump’s recently announced tarrifs – something that is being rejected by SolarWorld America’s former parent company, Germany-based SolarWorld Industries, along with other European manufacturers.

SolarWorld Industries and SolarWorld Americas both emerged from the former SolarWorld AG, but are now completely separate companies.

EU Prosun spokesman Milan Nitzschke, who until the insolvency of SolarWorld AG was also its corporate spokesman, confirms that generally in such statements, all exemption requests would be rejected, in order not to create loopholes.

It is unlikely that SolarWorld Americas released the document, without knowing of the future transaction shortly before it was annouced. It looks rather like a deal. SunPower is investing in Oregon’s ex-SolarWorld production and is now trying to avoid the import duties.

In addition to SunPower’s application, SolarWorld Americas only supports exemption requests from six manufacturers of off-grid products and one manufacturer of colored solar modules. All other requests, however, were not supported, also on the grounds that the duties are not anti-dumping measures.

Imports should only be exempt from duties, if the technology is not available in the U.S. and not in competition with U.S. production. SunPower was in a more favorable position in this regard, as the company’s backside contact cells are a unique feature.

In contrast, SolarWorld Americas is opposed to Panasonic’s proposal for heterojunction technology (HIT), which is also something special. In spite of everything, it would compete with Made in USA modules.

EU ProSun has also requested an exemption for European module manufacturers. Although technology is not the unique feature, production is carried out according to “high European social and environmental standards”, and the modules, which are of high quality, are also sold at a higher price.

As part of the customs duties under Section 201, EU ProSun’s Nitzschke now expects Chinese manufacturers to “compensate most of the tariffs through further loss coverage.” Perhaps they could save logistical costs by moving production back to China. Module manufacturers in Europe cannot do that.

However, the published document does not yet present a final decision. Nitzschke believes that Section 201 could also be interpreted as accepting EU ProSun’s reasoning. He hopes the U.S. government accepts this interpretation.

The discussion shows how much the viewpoints depend on the interests involved: SolarWorld Industries and EU ProSun in Germany, which have been campaigning for duties in Europe and earlier in the United States, and are resisting the expiry of the EU’s minimum price agreement, are now fighting against tariffs on their own products in the U.S.

On the other hand, SunPower’s Vice President Tom Starr is chairman of the U.S. Solar Energy Industries Association (SEIA), which has campaigned vehemently against U.S. import duties.

When asked if, with the new insolvency of Germany’s SolarWorld Industries, and the acquisition of SolarWorld Americas by SunPower, the trade conflict is now over, SunPower’s CEO, Tom Werner said in an interview with pv magazine USA that “this is a step in the right direction”.

However, it was not enough to reject the tariffs for the competitors, as the document shows.