23 February 2013, 21:21

Cheap Chinese solar panels – pros and cons

Cheap Chinese solar panels – pros and cons

Hundreds of thousands of workers in the EU may lose their jobs. According to estimations of German experts, if the EU implements it plan of introducing antidumping duties for solar panels from China, this would very likely be disastrous for European producers of solar batteries. Solar batteries production would reduce in Europe, and mass dismissals would start.

EU leaders have noticed long ago that solar panels from China are sold in Europe for much cheaper prices than their European analogues. It looked suspicious to the European Commission, and they started an investigation.

However, if the commission finds out that the Chinese are really selling their solar panels to Europeans for artificially lowered prices and introduces antidumping duties against China, Europeans would probably suffer from this even more than the Chinese themselves. Prices for solar batteries would sharply increase in Europe, which, as experts from the German consulting company “Prognos” are predicting, may decrease sales of them by 80%. Many companies that produce solar batteries would go bankrupt. As “Prognos” is predicting, in 3 years, Europe’s economy would suffer a damage equal to more than $ 30 bln, and about 240,000 workers would lose their jobs.

However, Russian experts are skeptical towards such pessimistic prognoses. After all, the Chinese might have influenced the German analysts to speak against these antidumping duties.

The Director of the Russian Institute of Energy and Finances Vladimir Feygin believes that the introduction of these duties would be only beneficial for the European market.

“I cannot imagine any catastrophic consequences for Europe if import of solar panels from China stops,” Mr. Feygin says. “After all, only 2 years ago, production of solar batteries in Europe, including Germany, was developing quite rapidly and successfully – and, most likely, it would only develop further if Chinese competitors go away from the European market.”

However, Mr. Feygin probably does not take one circumstance into account. True, only a couple of years ago, production of solar batteries was flourishing in the EU countries – but this was so because at that time, governments of these countries were actively supporting those who were working in the sphere of alternative types of energy. Now, the policy has changed. The governments are cutting expenditures on production of solar batteries.

The European Commission has not so far declared the results of its investigation about whether the Chinese are artificially lowing the prices for their solar panels. However, as some experts suppose, this is hardly because the commission has not found any evidence of that so far. The reason is that with the appearance of the cheap Chinese solar panels, sales of solar batteries in Europe have considerably grown. If antidumping duties for Chinese solar panels are introduced in Europe, this, together with lowing of subsidies to European companies that produce solar batteries, will be very unbeneficial for the European solar batteries industry. The European Commission understands this very well, and this is why it doesn’t hurry to announce its verdict on this issue.

Russian analyst Dmitry Lukashov says:

“I believe that the main problem here is not whether antidumping sanctions against cheap Chinese solar panels would be effective. The main problem is whether the EU’s program of transferring to solar energy has proved its worth. If European experts decide that this program should be curtailed, antidumping sanctions against China will probably be introduced. If the commission decides that the program should be continued, it will be subsidized, and antidumping duties for Chinese solar panels are unlikely to be introduced.”

However, the majority of experts believe that the EU will most likely introduce antidumping duties for Chinese solar panels – like the US did last year. In the US, this produced no cataclysms at the market of solar batteries, although the sales of solar batteries considerably reduced.

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