The USA and China are locked in a bitter tiff over solar panel imports from China. Note Solarworld filed a petition with the ITC which in all probability will put an anti-dumping duty on Chinese solar modules. Other countries whose solar panel producers have been swamped by the super cheap Solar Panel imports too are thinking of special custom duties. However the big Tier 1 Chinese solar panel makers are not sitting idle . They have already come out with strategies to circumvent the US Solar Panel Duties if they are imposed .

Solar Trade Wars are becoming the norm in the globe these days with the major one between USA and China.The instigator is the German solar company Solarworld which helped started the ITC Case in the USA. India too is thinking of putting some kind of import duty to protect its domestic solar panel producers which are dropping like flies. Chinese solar panel producers have swamped the world with super cheap solar modules. though a part of their low prices can be explained by competitive advantage, another part is due to  the labor, capital subsidy given by the Chinese government. It would not take  a rocket scientist to say that some of the biggest Chinese solar companies are insolvent and would be dead within a month without Chinese state loans.

Chinese Solar Companies like Trina,Yingli and Suntech will use 2  strategies

1) Set up solar module plants in the US and use cells made in China by their factories. Building a 50 MW solar module plants hardly costs much money . They can also outsource it to plants in Malaysia and Canada

2) Buy Solar Cells from Taiwanese Solar cell makers which have huge capacities without the competitiveness of the Chinese solar panel makers.Note Taiwan does not have strong low cost integrated solar players like China. They also lack the heft of the South Korean chaebols like Samsung and LG. So they can be easily exploited by the Big Chinese Solar Companies.

Taiwan’s Solar Energy Industry has shown the fastest growth after China in recent years.The country’s leadership in the Solar Industry was led by Motech which was once a top 10 Solar Cell Producer.However the recent financial crisis had hit the island nation’s solar industry very hard with Motech and E-Ton facing a massive erosion in profits and revenues.With the recovery in the solar industry in 2010..The Strong Solar Demand Tide has lifted all boats even the uncompetitive ones.,Taiwan remains largely a cell producer.Compared to the integrated Chinese producers like Trina,Yingli,LDK and others,Taiwanese Solar Makers are vulnerable to sharp price cuts.They depend on European customers who are largely uncompetitive and would face huge pressures with the decline in the German market.Chinese producers have much lower costs due to their vertical integration which currently most Taiwanese  lack

Chinese companies increasing order in Taiwan

Taiwan’s solar industry has seen increases in orders reportedly from China-based firms that are trying to avoid possible tariffs resulted from the US anti-dumping and anti-subsidy investigation.Taiwan-based solar cell makers have raised capacity utilization rates recently, with industry observers speculating that rush orders from China-based peers have been the cause of the rise.The orders may be increasing but the benefits may not be as good as thought, the observers said. China-based solar firms have been demanding prices similar to those of China-made solar products, which are lower than the production costs of some Taiwan-based firms, the observers explained.