Political Implications of Measures Hampering Free Trade on the Global PV Markets

Nov 30th, 2011 | By | Category: Articles, Political Impact

Grid Parity as a Political Objective Can Be Reached Earlier if PV Product Prices Remain Competitive Thanks to Chinese Suppliers

  • Declining PV product prices and competitive panel prices will help achieve grid parity even earlier than initially scheduled and thus further drive competitiveness of renewable PV energy in Europe compared to conventional methods of power generation. Therefore, fewer subsidies will be required to make investments in PV energy attractive and remunerative for investors.

Cost-Efficiency of PV Products Helps Substantially Reducing Subsidization Costs in Europe

  • Cost-efficiency of PV products and near-term achievement of grid parity are also in the best interest of politics because it helps saving subsidies paid by consumers’ tax money, as numerous PV industry-related studies have shown.

PV Market Requires More Steadiness and Reliable Rules: Continuous Policy Changes Contribute to Extraordinary Market Dynamics in Europe and Beyond

  • Changes of subsidization in the different global markets are among the reasons for extraordinary market dynamics currently undergoing the global PV market, according to the PRTM Photovoltaic Sustainable Growth Index 2011. Such changes are difficult to foresee and exacerbate long-term planning. Regulatory changes in part contribute to high volatility in demand and supply on all levels of the value added chain, and thus lead to erratic growth, the study has revealed.

China’s Ministry of Commerce Voices “Deep Concern” Over Free Trade with US, Europe

  • According to reports in several media reports online, China’s Ministry of Commerce on has expressed “deep concerns” over a preliminary ruling made by the US International Trade Commission that said Chinese enterprises are harming the US solar panel industry. The ministry said in a statement that the ruling was made without sufficient evidence showing the US solar panel industry has been harmed. “China is deeply concerned about the decision, which does not tally with facts and highlights the United States’ strong tendency for trade protectionism,” the report cited the Ministry as saying.
  • China’s Ministry of Commerce also addresses the issue of competitiveness: It said it hopes that the US side will analyze other reasons that may have led US-made solar panels to lose competitiveness. “The United States should avoid abusing trade remedies which will affect bilateral trade and mutually beneficial cooperation between China and US enterprises in the new energy sector,” the ministry’s statement said.
  • The debate underlines that possible political tensions that potentially arise over trade disputes benefit neither side.


Recommendations: European politics should…

  • Ensure conditions of open markets and level playing fields for all market participants;
  • Define clear legal framework for the PV industry and guide its open collaboration and sustainable development with proper policy;
  • Support the further growth of the European solar market, and maintain the relatively good momentum of its industry and market;
  • Refrain from criticizing Chinese companies’ efforts to improve the world’s environment – European governments should rather strengthen cooperation with other countries in the PV energy sector to jointly respond to climate and environmental challenges;
  • Observe and safeguard objectives related to business and job growth, climate protection and the welfare of the general public in Europe which all benefit from competitive PV product prices as a result of free trade.

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