The move reflects mounting concern in Europe and America about subsidised Chinese firms flooding the market with solar PV panels at artificially low cost.
Solarworld AG argues that China’s $30 billion of subsidies to its solar power companies violates global trade rules and constitute an unfair form of retailing below cost price or "dumping."
“We have dumping files in the European Photovoltaics market as well as in the US market and this is a case, of course, for the European Union,” Milan Nitzschke, a Solarworld AG spokesman told EurActiv by telephone from Bonn.
“Our Chinese competitors are going to Greece and telling people: ‘You can buy our products and solar modules and we are here with the Chinese bank of construction and they will give you the money for that,’” Nitzschke explained.
“This is unfair competition. It is state money or loans borrowed for projects in Europe with the condition that the customers have to buy Chinese products.”
The firm is still investigating several remedial courses of action in Europe to counter a perceived long-term strategy of forcing competitors out of business, and then fixing retail prices for Chinese firms from a monopoly position.
This situation was “not very different” from the one in the American solar market, Nietzschke said.
In the US, Solarworld AG and six other solar companies recently formed a "Coalition for American Solar Manufacturing" to demand that President Barack Obama slap $1 billion of duties on Chinese silicon cell and panel makers.
Gordon Brinser, president of Solarworld Industries America argued, that “artificially low-priced solar products from China are crippling the domestic industry.”
The company has been badly hit by a recession in the solar market, and recently laid off 66 workers at a Californian plant.
China denounces protectionist measures
But China maintains that what it calls protectionist measures would hurt the global economy, the planet’s environment and amount to a lose-lose situation for everyone.
“The US has no reason to criticise other countries' efforts to improve the world's environment, and should instead strengthen cooperation with other countries in the solar energy sphere to jointly respond to climate and environmental challenges,” an official said on the Chinese Commerce Ministry’s website.
The current trade spat has been given added bite by China’s great success in the world’s clean-energy race. It is now the biggest investor in alternative energy and clean technology.
Christopher Burghardt, vice president of First Solar, a leading US solar energy company which is not a party to the Solarworld AG suit, insisted that his firm's solar panels were cheaper on cost terms alone.
“The question is whether the Chinese government will continue to pump gazillions into the industry over the long-term,” he told EurActiv.
The investment “certainly came at extremely preferential rates and in extreme quantities, so typically we would call that a huge competitive advantage,” he said.
In the developing world, the success of the Chinese solar industry could also be seen as a model to emulate. But solar industry representatives in the West disagree.
“Europe should be very vigilant and make sure that China is compliant with the WTO and other international rules about subsidisation,” Burghardt said.
Nitzschke agreed. “European governments and the European Commission need to wake up,” he said.
“The US is already awake and aware and that’s one reason why we started the trade case in the US. We are investigating every option here. We have to act similarly in the European Union.”