GWEC statement on fostering a fair, open, and transparent trade environment for global wind energy. - Global Wind Energy Council (original) (raw)
The Global Wind Energy Council (GWEC), the representative voice for the global wind industry, notes the announcement from the European Commission on 9 April that it will launch an enquiry into Chinese turbine suppliers under the new Foreign Subsidies Regulation.
It is not a matter for GWEC to comment on any ongoing enquiry under the Foreign Subsidies Regulation. However, GWEC and its members put forth the following recommendations regarding the use of trade and other economic instruments, and their impact on the ability of the global wind industry to grow and meet international climate and energy targets:
1. GWEC believes that fair and transparent trade is essential to achieving the goals of the global energy transition and delivering its economic benefits.
- GWEC advocates for fair and transparent trade practices, coupled with companies operating on a level playing field, to enable the necessary development of the wind industry towards a 1.5C pathway.[1] The wind energy supply chain is highly globalised, which necessitates enhanced collaboration to maintain healthy competition, the most competitive cost of wind energy to the consumer and the highest levels of deployment. Maintenance of global supply chains requires healthy relationships amongst trading partners and cooperation within the global trading system.
- Unnecessary trade frictions in the global wind supply chain could pose a risk to climate, energy security and just transition goals. In general, enhanced trade restrictions can increase the costs of wind energy and limit competition in the supply chain. Measures which unnecessarily restrict trade and global investment could lead to a slowdown in deployment that could put the energy transition in jeopardy.
- GWEC carried out a deep analysis of the global wind supply chain in its recent report with Boston Consulting Group, showing that global scenarios involving heightened protectionism, restrictive trade regimes and distorted forms of competition will likely result in slower wind market growth, higher wind energy costs and lower financial sustainability for wind suppliers. GWEC’ s detailed recommendations on fostering scale and security in the global wind energy supply chain are contained in this report. (GWEC-BCG Report, December 2023)
[1] According to the 1.5C-aligned goal set at COP28 to triple global renewable energy capacity by 2030, based on authoritative scenarios from the International Energy Agency (IEA) and International Renewable Energy Agency (IRENA), this would require annual wind energy installations to roughly triple from current deployment levels of 117 GW in 2023 to at least 320 GW by 2030.
2. GWEC believes that competition is essential and is best managed through bilateral and multilateral activities.
- Competition is a vital feature of the international economic order. GWEC recommends that industry and governments jointly resolve issues of competition in a constructive manner, via cooperative dialogue and evidence-based negotiation in the appropriate bilateral and multilateral fora, rather than unilateral measures. Unfair or distortive market practices which result in legitimate injury to market actors may warrant investigation, which can result in authorities taking the appropriate action.
- Concentration risk in the global wind energy supply chain will require greater supply chain diversification, as well as strategic reshoring or onshoring to allow countries to grow their own capacities. But this should not manifest in unnecessary measures that outright block current trade flows and interrupt or delay deployment.
3. GWEC considers that trade restrictions could disproportionately affect developing economies, particularly low-income countries, and undermine the aim of a just and orderly transition.
- GWEC recognises that subsidy and market distortion issues are complex. However, it opposes unjustified and unfair discrimination in the international trade environment, as well as disguised restrictions on international trade. Such measures could disproportionately affect developing countries, leading to unequal opportunities for economic development and undermining the aim of a just and orderly global energy transition.
4. GWEC recommends the use of incentives and supportive policy frameworks to accelerate deployment of renewables projects and economic benefits.
- When implemented in a fair and transparent trade environment, GWEC supports incentive-based industrial policy which enhances the business case for renewables and accelerates the deployment of wind. Investment incentives and clear installation targets provide room for the wind value chain to work together with governments on fostering secure supply chains.
- Public procurement of wind energy should be designed based on clear, transparent and fair criteria. GWEC will provide recommendations on the scope and guidelines for pre-qualification and non-price criteria in auction design from a global perspective in a forthcoming position paper.
- According to GWEC’s Global Wind Report 2024 (to be published 16 April), many regions and countries are forecast to fall short of the wind capacity needed to meet its 2030 climate goals. In many cases, this is due to a lack of supportive policy measures, such as accelerated planning and grid connection regimes, measures to ensure sustainable electricity pricing and returns on investment, and availability of competitive finance. Implementing these measures is more likely to create a foundation for growth of a sustainable regional supply chain, without the need for distorted market competition that could undermine the speed, cost or equity of the global energy transition.
Media Enquiries
Sign-up for our Newsletter
Stay up-to-date on all the latest in the global wind energy industry
GWEC Europe Office
Rue de Commerce 31
1000 Brussels
Belgium
GWEC UK Office
Lady Bee Marina
10 Shoreham Port, Southwick
BN42 4BW
GWEC Asia Ltd.
10 Anson Road
#31-10, International Plaza
Singapore 079903
GLOBAL WIND ENERGY
Rue d’Arlon
69-71 1040
Bruxelles