WTO tells US to reconsider solar panel tariffs

In a move that many in the solar industry applauded, a World Trade Organization panel found that the US government overstepped its bounds when it imposed tariffs on solar panels and other goods from China.

us solar tariff
The World Trade Organization has ruled that the United States had violated certain rules regarding international trade in imposing duties in various Chinese-made goods including solar panels. Image: Shutterstock

Yesterday the World Trade Organization (WTO) announced its findings in the dispute between China and the United States over countervailing measures imposed on various Chinese-made goods including solar panels.

The WTO committee ruled that the US had violated certain rules regarding international trade in imposing the duties. You can read the entire ruling, complete with its (confusing) international-trade language, at this link. As a consequence, the US is now urged to “bring its measures into conformity” with the agreement on subsidies and countervailing measures, otherwise known as the SCM Agreement.

The solar industry was quick to support the ruling. Tony Clifford, CEO of Standard Solar had this statement: Like the overwhelming majority of the US solar industry, I certainly welcome yesterday’s decision by the World Trade Organization (WTO). This decision affirms what we all believed in 2012 – the US Department of Commerce trade decisions against the Chinese module manufacturers are essentially protectionist in nature. However, while welcome, the WTO decision will likely provide no relief for the US solar industry in the next few years, if ever.

Clifford said that the US is already paying too much for solar panels as a result of the initial ruling. He re-iterated many of the statements he made as keynote speaker during PV America in June. 

Today the cost of tier 1 Chinese modules delivered to the west coast of Mexico is $0.58/Watt. The same modules delivered to the west coast of the US cost American companies $0.76/Watt

Tony Clifford, CEO of Standard Solar

“Today the cost of tier 1 Chinese modules delivered to the west coast of Mexico is $0.58/Watt. The same modules delivered to the west coast of the US cost American companies $0.76/Watt,” he said. 

Referring to the new tariffs that were also announced in June, Clifford said that “the US DOC trade decisions are costing the American solar industry about $0.18/Watt — and likely costing more as early as next week.”

Jigar Shah, CEO of the Coalition for Affordable Solar Energy (CASE), had similar comments. “CASE agrees with the WTO that some important parts of the protectionist 2012 US solar tariffs are inconsistent with our trade commitments to others. Even more importantly, they hurt American solar workers and slow the deployment of clean energy,” he said in a statement.

Shah is equally concerned about the new tariffs and urged the Obama administration to “reconsider the wisdom of additional solar tariffs,” he said.

“The Administration should work to bridge the divide between all parties involved, and help to negotiate a win-win settlement that supports growth across all sectors of the US solar industry.”

SolarWorld, the petitioner in the trade cases against China and usually quick to comment on developments regarding the matter, did not issue a statement.

However, today on its website the comany posted a press release stating that the Coalition for American Solar Manufacturing (CASM), which it founded, has swelled to more than 250 employers of 25,000 Americans. 

On July 9, we reported that new global trade negotiations were underway in Geneva in an effort to come up with an Environmental Goods Agreement.  In addition to the US, China, and the EU, the WTO members in those talks are Australia, Canada, Costa Rica, Hong Kong, Japan, Korea, New Zealand, Norway, Singapore, Switzerland and Chinese Taipei.

This ruling, while unrelated to the new Environmental Goods negotiations underway, will surely have an impact on those very important discussions.

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