WASHINGTON — Dozens of solar industry executives, government officials, and foreign diplomats gathered Tuesday to urge federal trade commissioners to reject a petition from two troubled domestic solar equipment manufacturers to impose steep tariffs and minimum price guarantees on similar imports.
At risk, they argued, is the future of the solar industry itself.
“They seek a public remedy for their own private failings,” said Matthew R. Nicely, a lawyer representing the main solar trade group, the Solar Energy Industries Association, before the US International Trade Commission. “If successful, they will undermine the hard work and innovation that is making solar a viable alternative to conventional energy sources.”
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But Matthew J. McConkey, a lawyer for Suniva, the Georgia-based manufacturer that originally brought the petition, argued that the case was about more than two companies that managed to outlast the many manufacturers squeezed out of business by foreign competition.
“The United States is literally strewn with the carcasses of shuttered solar manufacturing facilities,” he said. “It’s about all of those companies and their workers who are out of business.”
The case, which follows an unusual procedure that could put the final decision about government intervention, and any remedy, directly in President Trump’s hands, could become one of the first major trade decisions of his administration. It also could determine how and whether the US solar industry can continue to grow.
At issue is whether the financial woes of Suniva and its co-petitioner, SolarWorld Americas, are a result of unfair competition from Chinese companies benefiting from state subsidies, or of their own business practices. And though the sharp drops in the cost of panels have made it difficult for domestic manufacturers to compete, they have also fueled a boom in solar development throughout the country, providing a lift to an industry that says it now has more than 250,000 jobs.
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Further complicating matters is that Suniva, once lauded on the White House blog as “an American success story” during the Obama administration but now in bankruptcy, is majority-owned by a Chinese company that now disavows the case.
With roots in a protracted trade war between the United States and China that started in 2011, the dispute centers on crystalline silicon cells, the major electricity-producing components, as well as the modules, or panels, into which they are assembled.
SolarWorld Americas, a subsidiary of a now-bankrupt German panel maker, had filed a trade complaint along with six other domestic solar manufacturers that accused their Chinese counterparts of using unfair government subsidies to finance their operations and then selling their merchandise for less than the cost of manufacturing and shipping it.
SolarWorld won the case, as well as a second that included Taiwan, where Chinese manufacturers had turned for cells to avoid anticipated tariffs. But that, the petitioners argue, set off a global race to the bottom on price, as manufacturers opened factories in other low-cost countries, leading to the current case. This time, the companies are seeking blanket global protections to keep manufacturers from circumventing tariffs aimed at specific countries by expanding elsewhere in what the petition referred to as a game of Whac-a-Mole.
The case, which the commission itself designated “extraordinarily complicated,” has given rise to a number of unusual alliances and fault lines.
It has lined up almost the entire domestic industry — from electricians to corporate executives — against two of its own. It has also made bedfellows of solar businesses and conservative-minded policy groups opposed to trade restrictions and subsidies that have in the past worked to undermine solar’s forward march.
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Among those opposing the Suniva petition is the American Legislative Exchange Council, which is connected with Charles G. and David H. Koch, billionaire brothers whose fortunes derive, at least in part, from fossil fuels.
Interest in the proceeding was so high that shortly before the hearing began, staff members were scrambling to squeeze extra chairs into the hearing chamber to accommodate all the witnesses and their lawyers, as well as the public. In that group was a crew of solar workers organized by the solar trade group, wearing T-shirts that said, “Save America’s Solar Jobs, No New Solar Tariffs.”
But at least one government official traveled to testify in support of the case: Bucky Johnson, the mayor of Norcross, Ga., where Suniva is based.
“Some might say protectionism — I say bunk,” he told the commission. “Given a level playing field, I believe that Suniva and the solar manufacturing industry can thrive in our economy and provide some of the most innovative and sustainable products in the world.”