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NREL: Chinese PV firms have cost disadvantage compared to U.S. producers

Yesterday, the group leading the push for tariffs to be imposed on Chinese PV imports  highlighted research claiming no cost advantage to the Chinese based on production costs.

The Coalition for American Solar Manufacturing (CASM) cited an October presentation from the National Renewable Energy Laboratory (NREL) as further support for the coalition’s allegations that the Chinese government provides illegal subsidies to Chinese PV firms.

The NREL presentation, “Solar PV Manufacturing Cost Analysis: U.S. Competitiveness in a Global Industry,” claims that Chinese have a cost advantage over U.S. producers of less than one percent. When including shipping costs, Chinese firms have a cost disadvantage of five percent.

Credit: NREL

CASM sees this analysis as validating its position that Chinese PV firms do not have lower production costs, but rather benefit from a government export campaign aimed at hurting U.S. competitors.

“This analysis from the renewable-energy research arm of the U.S. government corroborates our view that an export drive sponsored by the Chinese government is improperly intervening in the U.S. market,” said Gordon Brinser, president of SolarWorld Industries America Inc., the firm leading CASM.

“Highly efficient U.S. producers like SolarWorld can vie with any company in the world in legal competition. But the government of China’s illegal trade practices are neither economically nor environmentally sustainable for anyone,” Brinser continued. “Free trade is trade free of illegal foreign government intervention.”

The NREL analysis also noted the differences in U.S. and Chinese PV output. “U.S. private investors encourage technology differentiation,” the presentation said, “[while] China’s government-backed investors fund more mature technologies.”

However, some argue that such a tradition of innovation is at risk without swift action against the alleged unfair Chinese government support to PV firms.

Writing at The Hill, professors George Haley, University of New Haven, Connecticut and Usha Haley, Massey University, Auckland, warn that “if we allow the Chinese to drive the remaining U.S. manufacturers out of the market, we are offshoring the type of advanced, next generation manufacturing we should want to have here in the United States.”

This analysis comes at a time when support for applying tariffs on Chinese PV exports to the United States appears to be gaining momentum, especially since the International Trade Commission’s December decision to continue the investigation into CASM’s petitions.

See the full NREL presentation here.


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