West vs. China in solar war

Europe’s solar energy industry is facing a wave of bankruptcies because Asian companies offer their products much cheaper.

Several German producers of solar cells, panels and modules, including large market-leading companies, have reported massive first-half losses.
Q-Cells, one of the world’s largest makers of solar cells, said it would cut 500 jobs, nearly a fifth of its workforce, to ensure its survival after it reported a first-half loss of $69 million before interest and tax. The sales of Conergy, Germany’s second-biggest solar firm by revenue, were slashed in half in the first half of 2009 compared with a year earlier. Solarworld sales dropped 6 percent to $585 million in the first half, the company said in July.

The Germans say Beijing is helping its companies with interest-free loans from state banks and by blocking foreign companies’ access to China’s quickly growing domestic renewable energy market. This should be answered with an EU import tariff for solar energy products from China, Conergy and Solarworld officials have demanded.

But economic experts have said protectionist measures could hurt the entire industry in the long run.

Meanwhile, German solar energy companies are pursuing two strategies to escape the economic downward spiral: Several firms have already set up or are planning production facilities in Asia to slash costs. At home, they are investing in huge solar power plants to make money with the feed-in-tariff stipulated by Germany’s renewable energy law EEG.

UPI