In a move with potential to spark a trade war, the Commerce Department ruled Tuesday that US solar panel manufacturers are being victimized by Chinese manufacturers dumping cheap panels in North America that were unfairly subsidized by the Chinese government.

 

Amid an ongoing investigation, Commerce determined that Chinese producers and exporters have received subsidies ranging from 2.90 percent to 4.73 percent, a smaller advantage over US manufacturers than many analysts had expected. Commerce will now direct tariffs to be collected on Chinese imports.

The Obama administration argues that dumping of under-priced solar panels is a violation of World Trade Organization rules that has come at a high cost to US panel manufacturers. Several have already been forced to close domestic manufacturing facilities even though 2011 was one of the best years ever for US solar panel sales.