Germany considers domestic-content requirement for PV
Germany's Environmental Minister Peter Altmaier says he is "looking into" imposing restrictions against Chinese PV manufacturers.
The announcement was made on a television news talkshow on Thursday night. Regardless of the outcome, it marks a tremendous about-face in German trade policy in general and in German solar policy in particular.
Recently, Germany's leading solar panel manufacturer SolarWorld successfully petitioned the US Department of Commerce to impose import duties on Chinese manufacturers, who were found to be receiving unfair governmental support. But the US has a trade deficit with China, whereas Germany has a trade surplus with China; in other words, the US stands to win a general trade war with China, whereas Germany could only be the loser.
What exactly Altmaier hopes to accomplish with trade restrictions against China remains to be seen. The question is not whether Chinese firms compete fairly (the firms have received tremendous low-interest loans from the government, though the kickbacks only differ in volume from the subsidies provided to German firms that moved to the country's Solar Valley), but what the best action would be. Certainly, concerted EU action would be better than a trade war between the Germans and the Chinese. Germany is a major production equipment supplier to China, and Wacker is a major producer of solar silicon. All of these firms could suffer from a backlash against German companies in China – not to mention other German companies outside the PV sector from Siemens to Mercedes.
While it is anything but clear that trade barriers will be imposed, they would also come at the worst possible time. China is about to – finally – ramp up its domestic PV market, which could become one of the biggest in the world over the next few years as leading European markets (primarily Italy and Germany) reach their targets for photovoltaics. Germany would therefore give China an excellent reason to shut out German firms right when these firms need to shift from the German market to the Chinese market.
It is not the first time Chancellor Merkel's coalition has done an about-face in energy policy – the nuclear phaseout of 2011 reversed a policy in 2010 that extended the commissions of nuclear plants – nor is it the first time that Altmaier has displayed an apparent ignorance about the energy policy he supposedly overseas. Since taking office roughly 2 months ago, Altmaier has stated that he opposes "further subsidies" for renewable power because it needs to become less expensive (feed-in tariffs are reduced quite drastically every year for solar) and that making more energy-intensive firms, which are already benefiting from lower wholesale prices thanks to renewables, cover more of the surcharge for renewable power would not help lower the retail rate (it would). One begins to wonder whether Altmaier knows enough about energy policy to do his job. (Craig Morris)