Is a solar trade war about to flare?

US is considering taking a case against China to the World Trade Organization regarding Beijing's support of its solar companies.


Every solar company in the world relies on some form of subsidy to build or sell its products. That's because solar electricity is still about eight times more expensive than power generated by coal-fired plants. The global solar industry only really began to take off when, about a decade ago, governments introduced subsidies for clean energy systems in an effort to trim their carbon dioxide output and reduce dependence on fossil fuels.


Western companies also argue that Beijing's subsidy regime discourages the use of solar panels in China. Unlike Germany, China refuses to introduce tariff incentives that would drive domestic demand for solar energy.


"The (Chinese) government does not want to be purchasing or installing PV at the current prices. It wants to use the Western market to create volume to drive down the cost and, when the cost is lower, then China will start buying," says Michael Eckhart, president of the trade group American Council on Renewable Energy.
Reuters