Image copyright AFP Image caption Chinese solar panel makers have grown to become key players in the sector

The US has proposed higher and more extensive tariffs on Chinese solar panels.

The Department of Commerce said it plans to impose duties of between 18.56% to 35.21%. That is much higher than the tariffs announced in 2012.

The duties will be levied on solar panels and the cells used to make them. Previously they covered just the cells.

The US has said that import duties will help offset the subsidies given by China to solar panel makers.

China is the world's biggest maker of solar panels. But US manufacturers have alleged that government subsidies have helped Chinese manufacturers flood the US market with cheap goods, hurting US companies.

The ruling is a major setback for the entire US solar industry because it will immediately increase the price of solar power and cost American jobs Coalition for Affordable Solar Energy

They have argued that higher tariffs would ensure a level playing field for all.

Trade spat?

However, China has previously denied these allegations and there have been fears that an escalation of the issue may spark a trade dispute between the two countries.

Last year, Beijing reacted to the US duties by imposing its own tariffs of up to 57% on imports of polysilicon from the US - the material used to make solar cells.

At the same time, critics have argued that imposing high duties will push up the prices of solar panels and discourage consumers from switching to renewable energy.

"The ruling is a major setback for the entire US solar industry because it will immediately increase the price of solar power and cost American jobs in one of fastest-growing sectors of the US economy," said the Coalition for Affordable Solar Energy.

The commerce department is expected to confirm the final duties in the coming months.

The tariffs will then be reviewed by the US International Trade Commission (ITC) before a final decision is made.

China had faced similar allegations and tariffs from the European Union. However, both the sides settled the dispute last year as they agreed to set a minimum price for the panels.