Wind Tower Tariffs Disappoint China, Makes US Wind Energy Manufacturers Celebrate

Wind Tower Tariffs EU US China

The opposing sides are in complete difference with one side celebrating and one side opposing and condemning new tariffs on wind turbine towers. Multiple trade groups in the United States were celebrating new United States Commerce Department findings that Chinese & Vietnam manufacturers were selling wind turbine towers below the cost of production.

This is not the first time that import tariffs for anti-dumping measures were put in place by the Commerce Department. In May of 2012 tariffs on Chinese wind towers were hit with a 26% tariff that showed they were serious about underpricing the towers to gain an edge on the market.

Stated in a green energy publication called they said the Commerce Department was raising tariffs all the way up to 73% on wind turbine towers and Vietnam would see rates of 60% on import duties. The markets seemed to react positively to the news of this new tariff increase when a major Wind Energy manufacturer’s stock rose by 13% just hours after the ruling.

On the other side of the world manufacturers in China and Chinese officials are incredibly upset with the new restrictions and duties on exporting their wind technology to the US. Liu Huijuan, the China Chamber of Commerce for Import & Export of Machinery & Electronic Products has expressed that the accusation that the wind towers were dumped on the US market under production costs. Ms. Liu told the WSJ, “We are extremely unsatisfied and disappointed with the U.S. decision. The U.S. is trying to protect their own industry amid an economic downturn, without considering the development of the whole industry chain.”

This is a blow to the wind industry in terms of China’s export divisions because of their recent increase in producing towers for American wind farms. It was stated in that, “China exported $222.08m in towers to the US in 2011, more than double $103.57m the previous year and up from $177.73m in 2009.” More than doubling their output to the US this could clearly slow down that transition.

Specific duties / tariffs were placed on wind tower imports on companies with different rates. A company called Titan Wind Energy will receive a duty rate of 20.85%, Chengxi Shipyard will get 30.93%, Guodian United Power Technology Baoding and Sinovel Wind Group will get 26.25% and all other Chinese manufactured wind turbine towers will get a default duty rate of 72.69%.

This all comes at a time when the Wind Industry faces challenges on the Wind Energy Production Tax Credit. It is all coming down to politics with an election year boiling to a head before the election with the Mitt Romney Campaign publicly against Wind Energy PTC. The Des Moines Register interviewed the Mitt Romney campaign spokesman, Shawn McCoy which said, “He will allow the wind credit to expire, end the stimulus boondoggles, and create a level playing field on which all sources of energy can compete on their merits.”

The Obama Campaign has made their position clear with quotes of support showing up in the North American Wind Power publication stating from President Obama, “So I’m here today because, as much progress as we’ve made, that progress is in jeopardy,” he said. “If Congress doesn’t act, those tax credits that I mentioned – the ones that helped build up the wind industry, the ones that helped to bring all these jobs to Newton – those tax credits will expire at the end of the year if Congress doesn’t do anything. If Congress doesn’t act, companies like this one will take a hit. Jobs will be lost. That’s not a guess – that’s a fact. We can’t let that happen.”

While the focus of this article lies with wind turbine towers the bubbling trade war between the United States and China goes much deeper and more serious in other areas. Another area where a lot of contention is rising is in the solar manufacturing business. The European Union is not sitting on it’s laurels either as they have been watching this trade war closely and have been pushing back passing tariffs as well. The solar companies in China have been warning of a coming trade war with the EU and things don’t look to be getting better. Reuters is covering the dispute saying that, “China’s solar firms warned of a trade war on Thursday, calling on the Chinese government to strike back against an anti-dumping complaint filed by rivals in Europe, but the Europeans said they would not be put off by retaliation threats.” What good will come from all of these disputes remains to be seen. Many think the disputes will only slow down the renewable energy sector.

US to impose tariffs on Chinese made wind turbines From May 2012

In Beijing, environmentalists and an industry group slammed the US Commerce Department’s decision to impose import duties on Chinese wind-turbine towers.

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