Trade and Market Access

The wind industry needs a free and global market to prosper

GWEC actively supports the 2009 proposal for the establishment of a Sustainable Energy Free Trade Agreement discussed in the context of the G-20.

The global wind industry has gradually matured from a niche industry with very few stakeholders into a highly competitive high-growth sector within which a global industry competes to increase quality and to drive down the cost of electricity from wind projects on land and at sea. Developments have been spurred not least by access to global markets, with the overall goal of reliably delivering the largest possible quantity of CO2-free electricity at the lowest possible cost.

However, in recent years – at least partially as a result of the global financial crisis – more and more countries have raised tariffs for renewable energy components and implemented non-tariff barriers such as local content requirements that give special preference to local suppliers. This development is very dangerous for the further development of the wind industry and risks slowing down progress in advancing technology innovation, increasing quality, and in lowering the cost-of-energy of wind projects, the latter of which is increasingly demanded from regulators and politicians.

Increasing trade barriers will undermine the wind industry’s ability to build effective supply chains and drastically reduce the level of technology transfer across borders. The only way the industry can deliver on its promise to supply very large quantities of cost efficient; clean power for the future is to allow for significant scale, market stability, and market access.

Local content requirement

Local content requirements in the wind industry – which is presently characterized by over-capacity due to significant investments in the industry in recent years increase the total costs of projects, stifle innovation and could – in some cases – lead to contract awards to companies that have a strong local manufacturing base but have little or no previous experience in the wind industry.

The multilateral trade system must now take steps to defend level playing field conditions in the global wind industry. The last thing this industry needs at this moment is a gradual renationalization of the wind energy sector providing smaller markets with less effective competition.

For detailed discussion see here