EU solar firms to challenge EC on Chinese solar duties

European solar industry leaders are set to challenge the European Commission's "rose-tinted" findings on the impact of punitive duties on Chinese solar products on Wednesday.

Over 30 European photovoltaic (PV) companies are travelling to Brussels to attend a hearing at the commission organized by the Alliance for Affordable Solar (AFASE), AFASE said in a statement issued Tuesday.

Business leaders will detail on how the preliminary anti-dumping duties are already leading to order cancellations and job cuts, said AFASE, a coalition of over 740 European PV firms offering more than 65,000 jobs.

This result is "contrary to the European Commission's optimistic findings that the industry could miraculously create other markets or absorb the duties itself during the economic crisis," the association said.

The European Commission on June 4 decided to impose provisional anti-dumping duties on imports of solar panels, cells and wafers from China.

Starting from June 6, EU imports of Chinese solar products was subject to a punitive duty of 11.8 percent until Aug. 6, from when on, the duty will be raised to 47.6 percent if the two sides cannot sort out the dispute through negotiations.

The commission's decision has triggered widespread opposition from EU solar companies, especially the upstream and downstream operators.

"The commission has based all of its assessments on a sample of only seven companies," said Dennis Gieselaar, managing director of the Dutch company Oskomera Solar Power Solutions and board member of AFASE.

"The vast majority of EU installers cannot afford to absorb duties, even at the current level of 11.8 percent. For most of the downstream players, net profits are well below 10 percent," Gieselaar said.

"The commission is also wrong to claim that PV installers can shift sectors easily. PV installers and project companies cannot move to a totally different activity such as wind," he added.

"We are a professional and specialized industry, our staffs receive specific training and cannot switch sector from one day to the next," Gieselaar said.

As an unfortunate illustration of the impact of preliminary duties, Gehrlicher Solar AG (GSAG), one of the oldest companies in the solar industry, announced on July 9 that it had filed for insolvency.

The closure was a "direct consequence of EU-wide introduction of anti-dumping tariffs on Chinese modules and the resulting deterioration of market conditions in Europe," AFASE said.

With that example in mind, Thorsten Preugschas, CEO of Soventix GmbH, said,"Continuing these harmful and detrimental duties, as they are only leading to market contraction and are costing many green jobs across Europe."

"We have already had to lay off workers as prices increased and demand has been severely scaled back since registration and preliminary duties," said Preugschas, also chairman of AFASE.

"I can only hope the example of Gehrlicher Solar will awaken the European Commission and tomorrow's intervention will convince them to act rather than sit by the sidelines while our industry collapses," Preugschas added.

Earlier this year, a study presented by the independent Swiss research institute Prognos highlighted that the imposition of duty, at any level, would automatically trigger a demand contraction resulting in job losses.

As many as 242,000 European employments could be destroyed in the coming three years with duties of 60 percent, the study concluded.