One of the world’s biggest manufacturers of solar panels, Suntech, has declared bankruptcy. According to the Globe and Mail, Suntech Power Holdings defaulted on a payment of $541 million that was owed to US bondholders last week. The company’s Chinese creditors are owed more than $2 billion, reports the Wall Street Journal.
Production of solar panels has grown rapidly over the past year, while demand, though growing worldwide, has not kept up. Prices have dropped as a result, and bankruptcy has claimed at least one other large player in the solar energy market, Q-Cells of Germany. Suntech, which has a production plant in Arizona, will end production there next month.
Adding to Suntech’s woes, stiff antidumping tariffs, ranging from 18.32 per cent to 249.96 per cent, were imposed on solar cells from China last fall by the US Commerce Department. The move came after a complaint brought by SolarWorld of Germany. At the time, the antidumping penalty imposed on Suntech’s solar panels was 31.73 per cent.
Suntech’s future is uncertain at this moment. The company has been trying to find a saviour who will inject the needed capital to keep Suntech afloat. There is the possibility that the Chinese government will come to its rescue or let it fail.