‘Two weeks left to negotiate end to US-China solar spat’

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Time is fast running out for the US and Chinese to reach a negotiated settlement to their ongoing solar trade dispute, according to a leading expert on the case.

Speaking at Solar Power International in Las Vegas today, John Smirnow, the Solar Energy Industries Association’s VP of trade and competitiveness, said a window of only around two weeks remained for a deal to be struck.

The US Department of Commerce is set to reveal its final determination on anti-dumping and countervailing duties on Chinese and Taiwanese PV imports in mid-December.

The SEIA has been leading discussions between SolarWorld, the lead petitioner in the case, and the Chinese industry in an attempt to find a negotiated settlement to the dispute, under which China stands accused of outsourcing production to Taiwanese companies to avoid earlier duties introduced in 2012.

If such a deal is to be reached, using a so-called suspension mechanism, Smirnow said it would have be agreed at least 30 days before the DOC announces its final determination.

That would mean mid-November, but Smirnow said an additional consideration was the fact that the issue, he understood, was due to be raised at a bilateral meeting between President Obama and his Chinese opposite number, Xi Jinping, at the Asia-Pacific Economic Cooperation summit in Beijing on 12 November. Any policy positions to be taken during the summit must be vetted in advance by the administration, Smirnow said.

“If we achieve a settlement in the context of a suspension agreement, the next two weeks are when that deal is going to happen,” Smirnow said.

Smirnow said he was hopeful that a deal could be struck and that it if was, it would most likely contain a minimum price agreement and an import quota, along similar lines to the deal between the EU and China last year.

Shayle Kann, senior vice president at GTM Research, agreed the negotiations were “down to the wire”.

As to the implications of a negotiated agreement for the market, Kann said: “The possibility of a negotiated settlement and what that means for the market is entirely dependent on the structure and details of that settlement. So a minimum price sounds great, but if it’s a 78c per watt price that’s bad for the market. But if it’s 60c/w that could be good for the market, but is not something SolarWorld is going to agree to. So there’s a lot of room between that, which is where the real meat is in what happens.”

On any volume quota, Kann said a big consideration in how that is set is the likely rush in 2016 to complete projects  ahead of the Investment Tax Credit expiry due at the end of that year.  

“Unless you design the quota system around that, we could see supply restrictions in 2016,” he said.

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