Price Wars Seen Hurting Solar Sector in China

nsaspook

http://www.nytimes.com/2012/08/22/business/global/chinas-solar-panel-manufacturers-face-trade-and-finance-hurdles.html?src=recg

“Everyone talks about the struggle of the U.S. producers, but it seems like the Chinese producers are in a struggle of their own,” he said.

The Chinese Commerce Ministry has complained repeatedly, most recently in a statement Monday, that renewable energy programs by five state governments in the United States discriminate against imports from China, but it has not said whether it might file a challenge with the World Trade Organization. The ministry is also investigating a complaint from Chinese industry that the United States is exporting polysilicon, the main ingredient for solar panels, at prices below manufacturing costs.

American companies have contended that their polysilicon prices are low because they rely on very inexpensive hydroelectric power in Oregon, and energy is the biggest single cost in polysilicon production.

inetdog

Re: Price Wars Seen Hurting Solar Sector in China

nsaspook wrote: »

American companies have contended that their polysilicon prices are low because they rely on very inexpensive hydroelectric power in Oregon, and energy is the biggest single cost in polysilicon production.

So is the hydro power being sold at below (true) cost, making it an illegal government subsidy to the US producers?

nsaspook

Re: Price Wars Seen Hurting Solar Sector in China

inetdog wrote: »

So is the hydro power being sold at below (true) cost, making it an illegal government subsidy to the US producers?

During excess production hydro power is given away (when the true cost is zero) but it's a response to federal regulations about water quality for fish. Wind-farm owners also object to it because it costs them money in subsidies (The PWN wind war). The current amount of excess production and the resulting low electrical rates is a net positive for high usage consumers like data-centers and semiconductor plants but it pales in comparison to what the Chinese are doing with direct subsidies to solar production.

http://www.nytimes.com/cwire/2011/02/25/25climatewire-bonneville-power-to-wind-generators-shut-dow-22723.html?pagewanted=all

The financial impact of curtailment on wind generators may be severe. Notes from a BPA-sponsored workshop in December record this warning: "BPA believes that displacement potential exists over periods of 6 to 10 weeks, and that the cost will be in the tens of millions of dollars as Northwest wind generation capacity grows to 6,000 megawatts from the current capacity." The wind generators could lost as much as $50 million per year under worst-case conditions of excess generation and limited transmission capacity to export power out of the region.

But BPA said it will not reimburse idled wind generators for the money they would otherwise be receiving from federal production tax credits and state renewable energy credits if they were operating.

"We feel it's not good policy to pay someone to take electricity when it's necessary to comply with the Clean Water Act and Endangered Species Act," BPA spokesman Michael Milstein said.

http://www.forbes.com/sites/jonbruner/2011/10/20/the-high-stakes-math-behind-the-wests-greatest-river/