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Presidential Face Time

The brewing solar trade dispute could get an airing as soon as today between President Obama and the presumed head-to-be for China who is visiting the United States.

A faction of the U.S. solar industry that opposes any trade sanctions certainly hopes so. As a reminder, CEOs of 45 solar energy companies sent a letter to President Obama in advance of his visit with China’s Vice President Xi Jinping.

‘We are hopeful that you and Vice President Xi will discuss the mutual interests that America and China have in regard to expanding the use of solar technology. This is especially important in light of the potential for a mutually destructive trade war as both nations consider tariffs and duties on each other’s imports of solar technology,” they wrote.

The meeting comes at a critical time for the trade relations. In less than three weeks, the Commerce Department seems likely to impose tariffs on Chinese solar cells after a petition by a coalition of manufacturers alleged dumping into U.S. markets. A preliminary finding said that if dumping did in fact occur, duties would be retroactive for 90 days. That finding is unprecedented before the final resolution of a trade complaint.

Companies signing the letter manufacture polysilicon, the key component in solar cell manufacturing; build machinery and equipment used to produce solar cells; develop residential, commercial and utility solar projects and install solar panels.

Among the CEOs signing the letter are those leading some of the nation’s largest solar manufacturers and installers: AES Solar, MEMC/SunEdison, GT Advanced Technologies, REC Silicon, Rosendin Electric, Sungevity, SunRun Inc., and Swinerton, Inc. The companies represent segments of the industry from 19 states.

“We are at a crucial time in the development and growth of the solar industry with broad benefits for both countries and the rest of the world,” the letter continued.

The companies pointed out recent successes in the industry. “While US jobs increased by less than 1 percent last year, jobs in the solar industry increased by nearly 7 percent and are expected to grow by 24 percent this year.”

The Coalition for American Solar Manufacturing – founded by seven domestic crystalline silicon solar technology producers led by SolarWorld, the largest U.S. producer for more than 35 years – filed anti-dumping and anti-subsidy trade petitions in October 2011 against Chinese solar manufacturers to halt what the petitions characterize as pervasive, systemic use of state support to injure the U.S. industry.

China is also threatening retaliation, which could heighten tensions – and raise prices for everyone. Chinese polysilicon manufacturers are seeking tariffs on U.S. exports of polysilicon (most of which is produced in Michigan, Tennessee and Washington) which amounted to $873 million in 2010, nearly equal to the solar panels shipped to the U.S.
And a recovering economy and election-year politics only complicate matters further.

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