The Wind and the Sun

By Gregory C. Dorris, Partner, Pepper Hamilton LLP

Æsop Fables (Sixth century B.C.).  The Harvard Classics 1909-14.

Moral of the Story "Kindness Effects More Than Severity"

THE WIND and the Sun were disputing which was the stronger. Suddenly they saw a traveller coming down the road, and the Sun said: "I see a way to decide our dispute. Whichever of us can cause that traveller to take off his cloak shall be regarded as the stronger You begin." So the Sun retired behind a cloud, and the Wind began to blow as hard as it could upon the traveller. But the harder he blew the more closely did the traveller wrap his cloak round him, till at last the Wind had to give up in despair. Then the Sun came out and shone in all his glory upon the traveller, who soon found it too hot to walk with his cloak on.

All due respect to Æsop, but U.S. manufacturers are electing to use severity rather than kindness to change the behavior of foreign manufacturers in China and now also Vietnam where it comes to the wind and the sun.  On December 29, 2011, the Wind Tower Trade Coalition composed of Broadwind Towers, Inc. (Manitowoc, WI), DMI Industries (Fargo, ND), Katana Summit LLC (Columbus, NE), and Trinity Structural Towers, Inc. (Dallas, TX) filed an antidumping and countervailing duty petition on utility scale wind towers from China and Vietnam.  The U.S. International Trade Commission ("Commission") published its notice of initiation of its preliminary injury investigation in today's Federal Register.  The Commission's preliminary injury determination is expected in February of 2012, and the U.S. Department of Commerce ("Commerce") is expected to make its preliminary antidumping and countervailing duty determinations within six months of initiation, which is expected around January 18, 2012.  The final determinations of the Commission and Commerce are anticipated in 12 to 13 months.

The precise product at issue is utility scale wind towers used for utility scale wind turbines, which are wind turbines with a generating capacity of more than 100 kilowatts.  These towers form the base upon which the components of the utility scale wind turbines (the nacelle and rotor blades) are mounted.  The cases cover utility scale wind towers whether imported partially or fully assembled, and do not cover imported wind turbines, nacelles, or blades.  Petitioner states that the subject utility scale wind towers are produced in facilities located throughout the United States including California, Colorado, Iowa, Illinois, Nebraska, North Dakota, Tennessee, Texas, Washington, and Wisconsin.

Wind Turbines and Solar Cells

Today the wind, but just over two months beforeit was the sun, as on October 19, 2011, SolarWorld Industries America Inc. filed an antidumping and countervailing duty petition against imports from China of crystalline silicon photovoltaic cells, whether or not assembled into modules.  The Commission made an affirmative determination of material injury in its preliminary investigation when it voted on December 2, 2011.  Now Commerce is investigating whether the solar cells are being dumped and subsidized.  The final determinations in these cases should come sometime at the very end of this new year.

The specific product at issue in the solar case is crystalline silicon photovoltaic cells ("CSPV"), including laminates and panels, consisting of crystalline photovoltaic cells, whether or not partially or fully assembled into other products.  CSPV cells are made of polysilicon wafers that are chemically processed to create a positive-negative charge, and imprinted with electrical metal conductors into the wafer.  Once tested and sorted, finished cells are assembled into modules. Modules consist of a rectangular matrix of cells which are connected via bus bars, sealed, and affixed to a back sheet, then laminated.  The laminated cells are then framed and a junction box is attached.  CSPV cells and modules convert sunlight into electricity for on-site use or for distribution through the electric grid.  CSPV cells and modules are generally used in integrated solar power generating systems for large utilities and commercial and residential roof- top applications.  The domestic producers are located in Arizona, California, Delaware, Florida, Massachusetts, Minnesota, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Tennessee, Texas, Washington, and Wisconsin.

The wind and the sun were at war in Æsop's fable, but it is the market economy of the United States pitted now against the non-market economies of China and Vietnam.  Some argue that only a central government can successfully promote the new green technology product development on a worldwide competitive scale.  Others say only a central government can successfully manipulate worldwide competition to gain access to a market economy such as the United States.  Only time now will tell, but stay posted as both these hotly contested trade cases unwind.

Read more at Sustainability-Counsel.com from Pepper Hamilton LLP's Sustainability, CleanTech and Climate Change Team.

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