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News Analysis: Weak Finish From Europe on Chinese Solar Panels

July 28, 2013 by

But the case ended with a whimper on Saturday and illuminated the deep divisions within Europe — and how good the Chinese are at exploiting those differences. The European Commission announced Saturday that it had settled the case in exchange for a pledge from China not to export solar panels for less than 0.56 euros (74 cents) a watt, a price about 25 percent lower even than when the case began. The commission also decided to forgo imposing the steep tariffs on Chinese solar panels it had originally threatened.

The deal could end up strengthening the fractured Chinese solar panel industry and sending a wave of cheaper Chinese solar panels to the United States.

Trade experts said over the weekend that the European Commission’s meager outcome, in a case covering 6 percent of China’s exports to Europe, showed that while Brussels might have had a very strong case in terms of the law or economics, it was fatally weak from the beginning at the political level. Those political weaknesses increased as China’s leaders traveled repeatedly to European capitals and lobbied aggressively and successfully to divide Europe on the issue.

European makers of solar panels were furious over the weekend at receiving so little after a year of litigation, and vowed to sue. The European settlement also undermined Obama administration officials, who had taken a tough stance toward China on solar panel trade and had tried for several months to persuade the European leaders to side with them.

After nearly a full day of silence from Washington, the administration issued a thinly veiled criticism late Saturday afternoon of Europe’s decision to cut its own deal. “We believe there needs to be a global solution, consistent with our trade laws, that creates stability and certainty in the various components of the solar sector,” said Michael Froman, the United States trade representative.

Li Junfeng, a senior Chinese government energy policy maker, said that the trade deal was good for both China and the European Union. China has captured close to 80 percent of the European market for solar panels over the last several years, with exports that reached $27 billion in 2011, before the trade battle began. China has expanded its industry using huge loans from state-owned banks as well as cheap land and other incentives from government agencies. Industry executives say they expect China’s market share to fall to between 60 and 70 percent with the minimum price agreed on Saturday.

The politics of the solar trade case within Europe were highly unusual from the start. In most European trade cases regarding an imported product, the main country in Europe making the same product energetically favors protection from subsidized imports. Other European countries tend to like low-cost imports and be less enthusiastic about imposing tariffs.

The European solar panel industry is concentrated in Germany, and has felt the brunt of the impact of lower prices, yet the German government emerged as the biggest critic of confronting China on solar panel exports. Chancellor Angela Merkel of Germany opposed the trade case from the very beginning, saying that it would be preferable to continue talking with Chinese officials about the issue. Solar panel manufacturers in Germany tend to be independent companies that are not part of the country’s big industrial powerhouses like Volkswagen or BASF.

Germany has had far more success in exporting to China than any other European country, particularly in shipments of factory equipment, and Ms. Merkel has sought to cultivate a special relationship with Beijing. Most big German companies were unenthusiastic about the trade case, fearing that it could lead to a broader trade war that might hurt German exports.

“A tit-for-tat policy will more destabilize than help us,” Martin Brudermüller, the vice chairman of the German chemicals giant BASF, said at a news conference in Hong Kong last month.

Article source: http://www.nytimes.com/2013/07/29/business/global/weak-finish-from-europe-on-chinese-solar-panels.html?partner=rss&emc=rss

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European Solar Importers Defend Chinese in Anti-Dumping Case

February 19, 2013 by Leave a Comment

BRUSSELS — Importers of inexpensive solar panels from China said on Tuesday that imposing tariffs would lead to hundreds of thousands of job losses in the European Union, the biggest export market for the Chinese equipment.

The claims by the Alliance for Affordable Solar Energy, a coalition of companies that install and service panels, were aimed at stopping the European Commission from imposing penalties in the biggest trade case of its kind in terms of value.

The association presented its evidence on Monday at a hearing with the commission, which opened a case in September to determine whether the Chinese were selling solar equipment for less than the Chinese market price.

The antidumping case covers exports from China worth 21 billion euros ($28 billion) in 2011. The commission will decide by June whether to begin imposing provisional duties in the antidumping case. It began a second investigation in November into whether the Chinese government was unfairly subsidizing panel makers.

The cases have split the solar sector. European manufacturers are adamant that Chinese practices are illegal under international trade rules, and they are pushing the commission to take measures to save an important component of the clean energy industry. But installation and service companies represented by the alliance say the best way to promote clean power in Europe is to procure commodity products like panels from China and from other low-cost manufacturers.

Thorsten Preugschas, chief executive of Soventix, a German company that builds and operates solar plants worldwide, said at a news conference Tuesday that tariffs of 60 percent would lead to the loss of as many as 242,000 jobs over three years. He said Prognos, a consulting firm, had conducted the study.

Underscoring his sector’s reliance on Chinese imports, Mr. Preugschas said Soventix bought about 80 percent of panels from Chinese manufacturers last year because prices were as much as 45 percent lower than those purchased from some manufacturers in Europe.

Mr. Preugschas said that Chinese factories could sell cheaply because of their size. The difference was “economies of scale,” he said, and so the “big manufacturers have a price advantage, and it doesn’t matter where in the world they are located.”

A group of solar equipment makers, including SolarWorld, a German company that is among complainants in Europe and in a separate case in the United States, fought back Tuesday, saying that unfair practices had already meant thousands of lost jobs and 30 bankruptcies in Europe.

The study carried out by Prognos “applies mathematical trickery” to reach its estimate of how many jobs would be lost once tariffs were applied, Milan Nitzschke, the president of the group, EU ProSun, said in a statement.

Mr. Nitzschke also said that prices for consumers were stable or had even decreased in the United States and that the number of installations had grown, even after the American authorities imposed tariffs on Chinese solar products.

“Only fair competition keeps jobs in Europe and leads to a development of the solar energy in the E.U.,” Mr. Nitzschke said.

The United States imposed duties on billions of dollars’ worth of solar products from China over the next five years to shield American producers from lower-priced imports. The European case would be four or five times as large by value, partly because of the scale of the industry in Europe, where many governments offer incentives to install panels in homes and offices.

John Clancy, a spokesman for Karel De Gucht, the European trade commissioner, said his department would not comment on potential job losses from tariffs because the case was continuing. But Mr. Clancy said the “overall economic interests in the E.U.” would be taken into account during the investigation, including importers and industries that use imported products.

Article source: http://www.nytimes.com/2013/02/20/business/global/european-solar-importers-defend-chinese-in-anti-dumping-case.html?partner=rss&emc=rss

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A U.S.-Backed Geothermal Plant in Nevada Struggles

October 3, 2011 by Leave a Comment

The company is Nevada Geothermal Power, which like Solyndra, the now-famous California solar company, is struggling with debt after encountering problems at its only operating plant.

After a series of technical missteps that are draining Nevada Geothermal’s cash reserves, its own auditor concluded in a filing released last week that there was “significant doubt about the company’s ability to continue as a going concern.”

It is a description that echoes the warning issued in 2010 by auditors hired by Solyndra, which benefited from the same Energy Department loan guarantee before its collapse in August caused the Obama administration great embarrassment.

 The parallels between the companies illustrate the risk inherent in building the clean energy marketplace in the United States, government officials and industry experts say. Indeed, the loan guarantee program exists precisely because none of these ventures are a sure bet.

There are important differences between the fate of Nevada Geothermal and Solyndra, the maker of solar panels that has filed for bankruptcy.

The amount of money the federal government has at stake with Nevada Geothermal — a loan guarantee of $79 million plus at least $66 million in grants — is much smaller than the $528 million investment in Solyndra. There have been no allegations of wrongdoing by Nevada Geothermal or its Blue Mountain, Nev., plant.

Executives of the company express confidence that they can recover and say that the government investment is not at risk, despite the challenges they face because of a high debt load and lower-than-expected energy output at their plant.

 “We are here,” said Brian D. Fairbank, the chief executive, who like other company executives works out of Vancouver, British Columbia, where Nevada Geothermal Power has corporate offices. “We’re doing O.K.”

An Energy Department spokesman said he considered the Nevada Geothermal project a success, noting that the company had a long-term contract to sell its power.

“The Blue Mountain power plant is up and running, generating clean, renewable power and has been consistently making its loan payments on time and in full,” the spokesman, Dan Leistikow, said.

The company also did not hire half a dozen Washington lobbying firms, as Solyndra did, and there is no evidence of White House involvement in pushing the project.

But the Nevada Geothermal project has benefited from the support of a bipartisan collection of Nevada politicians, most notably Senator Harry Reid, a Democrat and the Senate majority leader, who has called his home state the “Saudi Arabia of geothermal energy.”

Nationally, geothermal energy produces only about 3,000 megawatts of power, a minuscule slice of the national electricity supply. The Nevada Geothermal plant generates just 35 megawatts — enough to serve about 35,000 homes for a year — and the company has only 22 employees in the state.

But Mr. Reid has taken the nascent geothermal industry under his wing, pressuring the Department of Interior to move more quickly on applications to build clean energy projects on federally owned land and urging other member of Congress to expand federal tax incentives to help build geothermal plants, benefits that Nevada Geothermal has taken advantage of.

“This project is exactly the type of initiative we need to ensure Nevada creates good-paying jobs,” Mr. Reid said in a statement in April 2010, after he visited the company’s Nevada plant. That was two months before the project even got conditional approval for the Energy Department loan guarantee.

During the tour, Mr. Reid had a chance to see electric generation equipment installed by a company called Ormat Technology, which is a Nevada Geothermal partner. Ormat’s lobbyist in Washington, Kai Anderson, and one of the company’s top executives, Paul Thomsen, are former aides to Mr. Reid.

Just last month, again with Mr. Reid’s support, Ormat secured its own Energy Department loan guarantee, worth $350 million, to help support three other Nevada geothermal projects that are expected to produce 113 megawatts of power.

Mr. Reid has received some support from the industry, in the form of at least $43,000 worth of campaign contributions from the geothermal industry since 2009, according to an analysis of federal campaign finance records.

Adam Jentleson, a spokesman for Mr. Reid, said that the senator was proud of his work as an advocate for geothermal power and a broad array of other clean energy projects in his state. But Mr. Jentleson, and the Energy Department spokesman, said Nevada Geothermal company had not received, nor been offered, any special treatment.

“If projects like this did not contain a certain level of risk, alongside their enormous potential for creating jobs and generating clean energy, there would be no need for the bipartisan loan guarantee program,” Mr. Jentleson said.

An Obama administration official also pointed out that the Nevada Geothermal project won the enthusiastic support of prominent Republicans in the state, and of the Bush administration.

When Nevada Geothermal Power was finishing construction on its plant in late 2009, there was ample reason for optimism. Boiling waters are not far from the surface at this remote site, three hours outside of Reno. It had a 20-year contract to deliver power to the state’s largest electric utility company.

Eric Lipton reported from Washington and Clifford Krauss reported from Houston. Kitty Bennett contributed research.

This article has been revised to reflect the following correction:

Correction: October 2, 2011

Because of an editing error, an earlier version of this article misstated the amount of federal grants to Nevada Geothermal as $667 million.

Article source: http://feeds.nytimes.com/click.phdo?i=541358ce8ff0610280f137981ec14bb7

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I.H.T. Special Report: Business of Green: A ‘Big Thumbs Up’ for Renewable Energy

June 5, 2011 by Leave a Comment

Most renewable sources are abundant, practically inexhaustible and far more climate friendly than fossil fuels. Some companies making equipment to harness these energies are growing rapidly.

Last month, experts advising the United Nations said renewable sources could deliver nearly 80 percent of world’s total energy demand by the middle of the century. That report, by the Intergovernmental Panel on Climate Change — the most authoritative body of experts, scientists and engineers specialized in climate change — was a welcome signal for an industry that has faltered in previous decades after government subsidies dried up and lower-cost fossil fuels made their technologies uncompetitive.

The report “is a big thumbs up for an industry that’s making huge advances in lowering costs and improving efficiency,” said Maja Wessels, global head of government affairs for First Solar, one of the largest makers of solar panels. “The experts have said that reaching high renewables targets will become very achievable.”

She said that the report should serve as basis for governments and lenders like the World Bank to plan investment in energy systems and infrastructure.

Governments staking out a low-carbon future also welcomed the findings.

Charles Hendry, the British minister for energy and climate change, said the report “makes it completely clear that this is a massively growing area” that could deliver “a turnaround moment for many parts of the economy.”

Even so, some financiers and environmental groups said the report underplayed the potential for renewable energy. The panel “wasn’t aggressive enough and the data were two years old,” said Gerard Reid, an analyst at Jefferies, an investment bank. “For solar panels, and offshore wind and concentrating solar power, we can get the costs down even quicker.”

WWF, an environmental group, emphasized that it had developed plans for generating 100 percent renewable energy by 2050.

Ottmar Edenhofer, co-chairman of the climate panel that wrote the report, said the findings were realistic. “Under no circumstances can we afford to omit or neglect renewables,” Mr. Edenhofer said by telephone. “But we must remember that there is more than one way to achieve a low greenhouse gas economy.” He was referring to alternatives to renewable sources like nuclear power and technologies under development to limit the damage of fossil fuel use by capturing and storing carbon dioxide before it reaches the atmosphere.

Some of the renewable sources with the greatest potential to deliver large amounts of energy, like certain kinds of solar power, remain expensive compared with burning fossil fuels, he said. And integrating a wide variety of renewable sources into existing power grids would be a huge technical and financial challenge, he added.

That caution was echoed by separate report released on May 24 by the International Energy Agency. While the agency found that biomass, geothermal and hydropower provide a steady stream of power and pose no greater challenge than conventional power to integrate into grids, other renewable sources — wind, solar, wave and tidal energy — fluctuate with the weather and are often in places that lack grids.

“When shares of variable renewables amount to just a few percent, a philosophy of ‘connect and manage’ will usually suffice,” said Nobua Tanaka, executive director of the I.E.A. Greater use of renewable sources means that “this will need to change,” he said.

A summary of the climate panel’s report was published on May 9, after 194 governments agreed to the text. The report was based on a comparison of 164 evaluations of the technology and provided the most comprehensive analysis to date of trends and perspectives for renewable energy. The panel was expected to publish a full report of more than 900 pages by mid-June, once scientists have completed final checks.

The report found that six sources — bioenergy, wind, solar, geothermal energy, hydropower and ocean energy — currently accounted for 13 percent of global energy supply. In one of the least optimistic outlooks for the sector examined by the panel, the world would generate 15 percent of its energy needs from those same six sources by 2050. But in one of the most optimistic projections, the world could generate 43 percent of its energy needs from those six sources by 2030 and 77 percent by 2050.

Renewable energy also would create jobs and help accelerate access to energy for 1.4 billion people without electricity.

Article source: http://www.nytimes.com/2011/06/03/business/energy-environment/03iht-RBOG-Kanter03.html?partner=rss&emc=rss

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Bucks: Friday Reading: Solar Panels Increase Home Values

April 22, 2011 by Leave a Comment

April 21

Thursday Reading: Unplugging for the Week

Marking screen-free week, marketing to kids with online games, apps for the royal wedding and other consumer-focused news from The New York Times.

Article source: http://feeds.nytimes.com/click.phdo?i=cf21945bcd794b12a38395905a7c6eb1

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