[Leaders Times] The EU Commission is contemplating the launch of an investigation into subsidies provided to Chinese wind turbine manufacturers, following its previous inquiry into Chinese electric vehicle subsidies.
Last week, the European Commissioner for Justice Didier Reynders hinted at a potential probe into subsidies for Chinese wind components. He pointed out that any Chinese government subsidies to the wind industry should be examined, much like the investigation into electric vehicle subsidies.
The European Commissioner for Energy Kadri Simpson also weighed in on the matter on the 9th (Monday), expressing the desire to avoid trade conflicts with China. However, she emphasized that if there is evidence of illegal trade practices like dumping, taking action would be necessary.
Nevertheless, some EU member states are exercising caution, as they view this investigation as highly political and potentially detrimental to EU-China relations.
The European wind industry has been grappling with challenges such as unfair competition from inexpensive Chinese products, lengthy permit procedures, rising inflation, and fragile supply chains, making it difficult to meet the EU's 2030 target of 60 gigawatts (GW) of offshore wind power.
Conversely, China is bolstering its domestic turbine production through government support and low-cost loans. As a result, Chinese companies have entered the market with lower production costs, roughly one-third of those of European or American counterparts, thus widening the gap between China and the West.
Meanwhile, the Brussels-based Bruegel Institute has spent at least a year examining China's subsidy practices. However, this investigation may not offer immediate solutions to the challenges currently faced by the European wind industry.
While Chinese wind turbine exports to the EU are smaller compared to electric vehicles, the Chinese government is expected to respond similarly to the electric vehicle subsidy investigation when this inquiry is initiated.
Given that an escalating trade dispute between the EU and China is against the interests of both sides, it's unlikely that the EU will impose countervailing tariffs on wind turbines at this juncture. The gap in turbine production costs between the analyzed country and the West continues to widen.