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UK Solar Industry Could Cut Jobs If EU Imposes Tariffs On Chinese Imports

Prognos, who are a European think-tank, has produced a report for the Alliance for Affordable Solar Energy suggesting that if the European Union impose tariffs on cheaply imported solar panels from China thousands of solar industry jobs and billions of pounds could be lost here in the United Kingdom and elsewhere in the EU.

Solar Panel
(image credit: stantontcady)

At the moment the EU are carrying out an investigation to establish if solar panel imports coming in from China are selling at below their market value due to Chinese manufacturers receiving unfair subsidies from the government in China. This is known as “dumping”.

The EU started their enquiries last year and it is the biggest such investigation ever undertaken considering that, in 2011, China exported in excess of £18 billion of key components and solar panels into the EU.  The investigation started following complaints from solar manufacturers based in the European Union. Potentially, the end result could be that duties designed to stop cheaper imports causing harm to the domestic industry in Europe could be imposed.

However, the report from Prognos indicates that if such duties were imposed jobs could be lost in the EU and economies could suffer as solar panel prices could increase resulting in a drop in solar panel installations.

Worryingly, if a solar panel import duty of 60 per cent were imposed it could have a huge impact on the UK economy as most solar panels used in the UK are imported. Over 3 years the solar power industry could reduce by 80 per cent, 38,600 jobs could go and the economy could loose £3.46 billion.  If the duty were 20 per cent it is estimated that 19,300 jobs could be lost and the UK economy could loose £1.6 billion.

However, looking at the whole of Europe a duty of 60 per cent could cost the economy a huge £27 billion spread over a 3-year period with 242,000 jobs being lost. To compound matters, machinery and raw material exports to China would drop and some related services would be affected. Although production of solar panels could be increased by some EU manufacturers this would in no way make up the lost jobs and impact on the economy.

As the EU has only recently started their enquiry it would be some time before any conclusions were reached. We await developments.

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