EU wind turbine subsidy probe unfair, regressive

A probe launched by the European Union into subsidies received by Chinese suppliers of wind turbines to the continent, will harm the legitimate rights of domestic businesses to engage in fair competition and undermines the stability of global industrial and supply chains, experts said.

The investigation will look into the development of wind parks in Spain, Greece, France, Romania and Bulgaria, said Margrethe Vestager, European Commission executive vice-president, during a lecture at Princeton University in the United States on Tuesday.

Vestager's announcement comes just days after the EU opened a separate subsidies probe into Chinese companies bidding for a solar farm contract in Romania.

Highlighting the futility of protectionism, Foreign Ministry spokeswoman Mao Ning said at a news conference in Beijing on Wednesday that such policies fail to address the underlying issues and instead protect backwardness at the expense of future progress, ultimately resulting in a lose-lose situation for all parties involved.

The China Chamber of Commerce to the EU has also expressed deep dissatisfaction regarding the unfair practices that hinder the legitimate operations and growth of Chinese businesses in Europe.

The EU's continuous use of the Foreign Subsidies Regulation as an economic tool to target Chinese companies sends a detrimental signal to the world, suggesting discrimination against Chinese enterprises and endorsing protectionism, the group representing Chinese business interests in Brussels said in a statement on Tuesday.

The CCCEU also voiced a strong call for the EU to rectify its wrongdoings and return to a path of dialogue and cooperation, providing a fair, just and nondiscriminatory business environment for Chinese companies operating in Europe.

"While Chinese wind turbines are technically comparable to those in the EU, the strength of China's wind turbine manufacturing industry chain far surpasses that of the EU. This disparity is attributed to synergistic industry chain development and mass production, providing a significant competitive edge in pricing," said Lin Boqiang, head of the China Institute for Studies in Energy Policy at Xiamen University.

"The current trade conflict initiated by the EU stems from concerns about Chinese companies dominating the European wind power manufacturing market. However, it has limited benefits to the EU and unlikely success in curbing Chinese industrial development. First, Chinese wind turbine and parts manufacturers' export volume to the EU is not significant, and second, the EU lacks a complete industrial chain, especially in upstream materials like steel production," he said.

Data from the Chinese Wind Energy Association (CWEA) showed that in 2022 the nation's newly increased wind turbine export capacity was 2.29 million kilowatts, accounting for only 4.6 percent of the domestic newly added installation scale that year.

Of this, export capacity to Europe was only around 198,000 kilowatts, or about 8.7 percent of the export capacity in 2022.

While the scale of offshore wind power facilities remains limited, the proportion of overseas revenue for leading manufacturers is not high either.

Take Goldwind as an example. Last year, the company had the highest overseas newly installed capacity, reaching 748 megawatts. However, this number accounted for less than 5 percent of the company's total newly installed capacity of 16.4 gigawatts.

Goldwind is also one of the earliest wind power companies to go global, with business operations spanning 38 countries across six continents. Over the past three years, Goldwind's wind power newly installed capacity has consistently ranked in the top three globally, according to BloombergNEF.

Last year, four of the top five companies in global wind power newly installed capacity rankings were Chinese companies, BloombergNEF said.

Qin Haiyan, secretary-general of the CWEA, said China's competitive advantage in wind power comes from years of large-scale development, continuous technological innovation, and a complete industrial supply chain.

In an article on Euractiv.com on Monday, Peng Gang, minister for economic and trade affairs of the Chinese Mission to the EU, dismissed EU's accusation that subsidies or no-market practices have made Chinese green sectors competitive.

He said the EU and its member states have granted huge subsidies to local enterprises, but Europe is still struggling with its own competitiveness, which fully demonstrates that competitiveness could not be earned by subsidies.

"In fact, the secrets behind Chinese products going global have never been so-called subsidies, but diligence, innovation and competitiveness awareness of generations of Chinese entrepreneurs," he wrote.