Solar Firms Seek Duties in China Dumping Case

A group of U.S. solar-panel makers Wednesday called on the federal government to punish Chinese rivals with extra duties for allegedly dumping their products on the U.S. market.

Executives of SolarWorld AG, a German-based company that makes solar panels in Oregon, led the group at a news conference here, flanked by both U.S. senators from Oregon.

SolarWorld "can compete with anyone in the world," said Gordon Brinser, president of the company's U.S. unit. But, he added, "illegal subsidies in China" have prompted "the Chinese solar industry to come in and gut and own the U.S. solar industry."

One of China's top solar-panel makers, Suntech Power Holdings Co., rejected the accusations. It called SolarWorld's petition "protectionism" that could "put thousands of jobs at risk." Suntech added, "A solar trade war would deal a major blow to the global economy and to our common goal of achieving a clean energy future."

The solar battle touches on two hot debates in Washington and on the Republican presidential campaign trail: China's trading practices and the future of clean energy in the U.S. The Obama administration has blamed China in part for the demise of Solyndra LLC, the solar-panel maker that recently filed for bankruptcy after receiving $535 million in U.S. loan guarantees.

SolarWorld, one of the largest solar-panel suppliers in the U.S., recently shut down one of its Oregon facilities and laid off more than 150 workers.

The industry is struggling with soft demand in Europe—the world's largest solar market—and falling prices that executives blame on oversupply from China and other Asian countries. The difficulties have driven solar-panel company stock prices to multiyear lows.

Sen. Ron Wyden (D., Ore.) said that while U.S. demand for solar power has been "skyrocketing," the "American solar industry has been collapsing."

Joined by Sen. Jeff Merkley (D., Ore.), Mr. Wyden said China was "cheating" by giving panel makers inexpensive loans. Mr. Merkley said Chinese government-backed banks extended $25 billion in loans to large solar-product manufacturers last year at fixed, subsidized rates.

Suntech has denied receiving special help from the Chinese government or government-backed banks.

The U.S. makers are asking the Department of Commerce and the International Trade Commission to impose a duty on panels imported from China, a market that totaled $1.6 billion in the first eight months of 2011. SolarWorld accused Chinese manufacturers of selling solar panels at less than half of what the production costs would be in a comparable free-market economy, and is asking for tariffs to make up the difference.

The U.S. could take a year to make a decision, though some duties could be imposed earlier on a preliminary basis.

The case includes only panels made with crystalline silicon. Some U.S. firms that use other technologies, including First Solar Inc., said they weren't involved in Solar World's petition and avoided endorsing it.

"We are a global firm, and in our experience the industry and our customers benefit most when trade is free and fair and all participants operate on a level playing field," First Solar said.