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Tariffs to hurt US wind industry

0 Comment(s)Print E-mail China Daily, May 24, 2019
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Wind turbine blades are to be installed at the wind energy base of Hami in northwest China's Xinjiang Uygur Autonomous Region, June 5, 2015. Rich in renewable energy resources, Hami is one of the country's major wind power bases. [Photo/Xinhua]

The US tariffs on wind turbine related products made in China will have a harmful effect on the US wind industry but limited impact on Chinese wind turbine manufacturers, insiders said.

Tom Kiernan, chief executive officer of the American Wind Energy Association, said earlier that tariffs on Chinese imports could raise the cost of wind power in the US by as much as 10 percent.

The association also said in a statement that tariffs will have a harmful effect on the US wind industry, with canceled projects creating a ripple effect of lost jobs throughout the industry, from factory workers to farmers to truck drivers nationwide.

"These tariffs on Chinese parts and steel and aluminum products overwhelmingly impact US manufacturers, creating millions of dollars in unforeseen costs that could endanger up to a quarter of future US wind projects," it said.

The US decided to increase tariffs on $200 billion worth of Chinese goods from 10 percent to 25 percent as of May 10, which include wind turbine generators, related products and raw materials made in China.

In response, China announced on May 13 that it will raise the rate of additional tariffs imposed on some imported US products from June 1, including a 25 percent tariff on wind turbine products.

Insiders believe China's move to raise tariffs on US-made wind turbines will have a limited effect on domestic wind turbine makers but will raise costs for the US wind power industry.

Hua Pengwei, an analyst with GF Securities, said considering most of the wind turbines in China has already achieved domestication, China's tariffs on US wind turbine products will have a limited effect on domestic wind turbine manufacturers.

While some of the special parts are purchased from abroad, the procurement is done mostly in European countries, he said.

Qin Haiyan, secretary-general of the wind power committee of the Chinese Renewable Energy Society, said that exports of wind turbines from China to the US were a small proportion of exports and, as a result, tariffs would have a limited impact.

According to Jonathan Luan, a Bloomberg New Energy Finance analyst in Beijing, the Chinese turbine manufacturer that has a relatively high exposure, specifically to the permanent magnet items on the tariff list, is Goldwind. But even so, it has only supplied a small number of US projects.

"The higher tariffs scheduled to hit on June 1 should have a limited impact on the wind sector," he said.

"Previous tariffs on generators and their components also did not have a major influence. Relevant imports from China in 2017 amounted to less than 1 percent of the estimated $6.1 billion US wind farm investment that year."

Shanghai-based energy company Envision Group, the country's second-largest wind turbine maker, was quoted by Jiemian.com as saying its business related to wind turbines in the US is limited, and Mingyang Smart Energy, the country's third-largest wind turbine manufacturer, also said its business abroad is mainly in the Southeast Asian countries.

Xinjiang Goldwind Science & Technology Co, China's largest wind turbine manufacturer, told China Daily that it will abide by local laws and regulations to collaborate with local partners around the globe.

According to a report released by the Chinese Wind Energy Association, Chinese wind turbine makers exported 3.76 billion kilowatts last year. China's newly installed capacity for wind power in 2018 reached 211.43 billion kW, and exports only accounted for 1.8 percent.

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