China's Solar Power Industry Rebuffs U.S. Sanction Threat
Business + Economy

China's Solar Power Industry Rebuffs U.S. Sanction Threat

Leaders of China's solar power industry rejected a U.S. trade complaint that they receive unfair government support and said Tuesday possible sanctions would hurt American consumers and development of clean energy.

Solar and other renewable energy technology has emerged as an irritant in U.S.-Chinese trade. The two governments have pledged to cooperate in development but accuse each other of violating free-trade pledges by subsidizing their own manufacturers.

The chairmen of four of China's biggest solar companies, including Suntech Power Holdings Co. and Yingli Green Energy Holding Co., said at a news conference that their success comes from more advanced technology and skillful management.

"If you ask whether the solar industry in China has received special treatment or special support, the answer is no," said Suntech's Shi Zhengrong, one of the solar power industry's most successful entrepreneurs.

Beijing is promoting renewable energy both to curb rising demand for imported oil in the world's second-largest economy and in hopes of creating a profitable technology export industry. It gives research grants and tax breaks to developers but says they are in line with those given by other governments and comply with free-trade rules.

China's producers of solar panels and equipment grew rapidly over the past decade as they supplied demand from Germany, Spain and other markets where power companies were required to meet renewable power production quotas.

The U.S. Commerce Department launched an investigation this month into complaints that Chinese companies were exporting solar panels and equipment to the United States at less than fair value. A final ruling is due in July. If the complaint is upheld, the U.S. government could impose punitive tariffs.

The case has attracted unusual attention for a trade complaint following the bankruptcy of solar-panel maker Solyndra LLC, after the California-based company received a $528 million U.S. government loan.

Last week, China's Commerce Ministry announced its own trade probe into whether U.S. government support for producers of wind, solar and other renewable energy technology is an improper trade barrier.

Also at Tuesday's news conference were Yingli chairman and CEO Miao Liansheng; Gao Jifan, chairman and CEO of Trina Solar Ltd.; and Qu Xiaohua, chairman and CEO of Canadian Solar Ltd., headquartered in Ontario with factories in China.

If Washington imposes sanctions, one result will be a loss of American jobs because U.S. companies are both buyers of Chinese products and suppliers of materials, the companies said in a statement. They said Chinese manufacturers spend some $2 billion a year to buy materials such as polysilicon from U.S. suppliers.

"Any trade restrictive measures that may be imposed will unavoidably cause serious impairment to the sustainable development of the green energy industries as well as consumers' interests both in China and the United States," said the statement.

The executives sharply criticized the lead company in the Commerce Department complaint, SolarWorld Industries America Inc., a unit of Germany's SolarWorld AG. They said it receives U.S. and European subsidies while complaining about Chinese support.

"We applaud the support of the European Union and the U.S. government toward renewable energy. But we are very sorry that SolarWorld has applied such a double standard when they talk about subsidies," said Canadian Solar's Qu.

Tensions over access to renewable energy markets are especially sensitive at a time when the United States and other Western governments want to boost technology exports to revive economic growth and cut high unemployment.

The United States and China, the two biggest emitters of climate-changing industrial gases, agreed in 2009 to create a joint center to research cleaner coal, building efficiency and clean vehicles.

Chinese authorities have tried to mollify foreign companies that complain Beijing might be trying to squeeze them out of renewable energy and other emerging industries.

The U.S. commerce secretary, John Bryson, said Chinese officials at trade talks this month pledged equal treatment for foreign companies in electric vehicles and other emerging industries. According to Bryson, the officials said foreign producers would be eligible to apply for government subsidies.



Suntech Power Holdings Ltd.:

Yingli Green Energy Holding Co.:

Trina Solar Ltd.:

Canadian Solar Ltd.:

Copyright 2011 The Associated Press.