US slaps taxes on wind towers from China

Updated: 2012-05-31 10:20

By Zhang Yuwei in New York (China Daily)

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Preliminary tariffs stem from complaint that Chinese companies sold exports at below cost

The United States announced preliminary duties from 13.74 percent to 26 percent on Wednesday against wind-turbine towers imported from China, a move that will heighten tension over trade of clean-energy technologies between the economic powers.

The announcement by the US Commerce Department came two weeks after the agency, responding to allegations of market dumping, slapped preliminary duties on Chinese-made panels used in converting solar energy into electricity.

Those tariffs, which if affirmed through further investigation won't take effect until October, amount to 31 percent on major China-based solar panel makers such as Suntech Power and Trina Solar, and 250 percent on smaller Chinese manufacturers.

IHS, an economic analysis firm, recently predicted that US anti-dumping duties against Chinese solar panel makers could lead to a suspension of about 45 percent of solar-module shipments to North America this year.

Wednesday's decision stems from the department's investigation into a trade complaint by the Wind Tower Trade Coalition, which comprises four producers of utility-scale towers - Broadwind Towers Inc of Wisconsin, DMI Industries of North Dakota, Katana Summit LLC of Nebraska and Trinity Structural Towers Inc of Texas.

The case covers utility-scale wind towers that are at least 50 meters high and designed to support turbines with generating capacity of 100 kilowatts or more. It doesn't include the turbines, or blades, that the towers support.

CS Wind China, CS Wind Tech and CS Wind Corp collectively received a preliminary US duty of 13.74 percent; others including Titan Wind Energy in Suzhou, Titan Wind Energy Equipment of Baotou and Titan Metal in Shenyang were hit with a preliminary duty of 26 percent. All other Chinese producers face a duty of 19.87 percent.

The coalition filed its petition with the Commerce and the US International Trade Commission in late December 2011. Its member companies complained that Chinese competitors had harmed their business by selling exported items, which allegedly benefited from subsidies from China's government, below market cost in the US. The alleged subsidies, according to the complaint, included grants, preferential tax treatment and cheaper prices for raw materials.

Alan Price, a private Washington lawyer who is lead counsel for the coalition, called Wednesday's ruling "an important step in remedying the harm caused by unfairly traded wind tower exports".

Anti-dumping tariffs such as those sought in the wind towers and solar-panel cases are applied when a flood of artificially cheap imports is found to have hurt manufacturers in the importing country.

Another challenge facing the US wind-turbine industry is the potential expiration at the end of 2012 of the American Renewable Energy Production Tax Credit Extension Act, which benefits US clean-energy industries.

Chinese government officials have argued that some US clean-energy initiatives violated free-trade rules limiting government support.

US President Barack Obama, visiting a wind-power factory in Iowa last week, said that continuing the production tax credits would preserve about 37,000 clean-energy jobs that would otherwise be at risk.

In 2011, the US imported an estimated $222 million of wind-turbine towers from China and Vietnam, where many Chinese manufacturers in the industry operate, the Commerce Department said.

That was more than a quarter of the US market in 2011 and double the share the two countries had the previous year.

The department said it will announce a final decision on this case in August. If it affirms the preliminary findings and the ITC separately determines that the subsidies have injured US companies, the tariffs could be final by October.