Last week, Tracy Barry, news anchor for Portland-based NBC affiliate KGW, talked to President Obama about the recently filed trade petitions by the SolarWorld consortium and its allegations of solar panel dumping.

Barry asked: "SolarWorld is one of our companies in Oregon, and they are accusing China of dumping solar panels in the United States. Would you be willing to look at any kind of actions, tariffs, whatever, to protect those green jobs in the U.S.?"

Obama responded: "We have seen a lot of questionable competitive practices coming out of China when it comes to the clean energy space, and I have been more aggressive than previous administrations in enforcing our trade laws. We have filed actions against them when we see these kinds of dumping activities, and we're going to look very carefully at this stuff and potentially bring actions if we find that the basic rules of the road have been violated."

SolarWorld filed its petitions on October 19, during the week of the U.S. solar industry's largest trade show, Solar Power International.  

According to a recent statement from Gordon Brinser, the President of SolarWorld Industries America (headquartered in Hillsboro, Oregon), "China is cheating on global trade rules." Brinser also said that "China’s state-sponsored solar industry is receiving massive illegal subsidies and is illegally dumping crystalline silicon solar products into the U.S. market."

Brinser continues, "China’s illegal actions are undercutting fair market value and threatening to eliminate America’s solar manufacturing. [...] As long as China is allowed to continue cheating, there is no way America can expect to compete in the solar energy race."

Andrew Beebe, the Chief Commercial Officer at Suntech, the world's largest manufacturer of solar panels and a China-headquartered firm, calls the action "a PR stunt by one foreign company." He adds,"No major American company is involved." Beebe also maintains that as a global supplier, the firm will sell products where tariffs are less of an issue.

We've tried to identify the other American firms that make up CASM, the Coalition of American Solar Manufacturers, and have only been able to identify those that are not part of the effort. Those that are not part of the consortium include SunPower, First Solar, MiaSolé, CaliSolar, MEMC, and Suniva.

Lindsay Riddell, the clean energy reporter at the San Francisco Business Times, notes that "there’s a historic record of these cases that shows that the International Trade Commission nearly always sides with the petitioner." That would be SolarWorld in this instance. Note that it's not the ITC that makes the ultimate decision -- the ITC determines whether U.S. manufacturers have been harmed, but it's the Department of Commerce's Import Administration that determines whether dumping has been going on. That said, the DoC tends to rule in favor of the plaintiff, as well.

This issue is not going to go away. The claim process has started and it could yield results, some intended, some not, that might change the dynamic of the U.S. solar industry. A tariff on Chinese panels could change the investment return profile of some of the larger utility-scale solar projects.

Here's an example.

Sempra Generation is developing the massive 700-megawatt Mesquite Solar project, located near Phoenix, Arizona. China's Suntech is the panel supplier for the initial 200-megawatt (DC) phase of the build. America's Advanced Energy Industries (Nasdaq: AEIS) is the inverter supplier for that phase.

A tariff on the Chinese panels could jeopardize the economics of the project and sour the deal between Sempra and the power purchaser, Pacific Gas & Electric (PG&E). The project could wither and fail to get built. In this scenario, no American inverters from AE would be bought, no American workers would build the plant, no solar panels from Suntech's Arizona plant would be built and low-cost renewable energy would not be produced at the site.

It's difficult to view that as a victory for the American solar industry, but it could play out differently. First Solar or SunPower panels might work in the same deployment absent the hypothetical tariff. Solar Frontier, Sharp, or MiaSolé might also benefit from the imposition of a tariff on Chinese panels.

So, non-Chinese panel vendors might benefit but American project developers like MEMC's SunEdison or Sharp's Recurrent could be hurt by rising module prices.

One of the most recent and relevant examples of this type of trade petition in action involves extruded aluminum. Here are some details on that case. More details can be found at The Aluminum Extruders Council; here's a list of current orders against imports from China. The extruded aluminum case took about one year from filing to duties being imposed.

We'll be diving deeper into these matters over the coming days and weeks.

Here's the Obama interview: