Wednesday, 29 December 2010

The Empire strikes back: USA takes China to the WTO over wind power subsidies #renewables #trade #flexingmuscles

Wind Turbines, Lake George (Weereewaa), near Bungendore NSW
September 2009
The turbines were in test mode at this time.

What can one say about the World Trade Organisation (WTO) from my lowly position in the world?  I hear news items from time to time announcing that Australia is taking a matter to the WTO or someone is trying to get their produce into the Australian market and has had to take their case to the WTO. We object because our country is clean of whatever and the other country gives room and board to some insect or disease I have never heard of.  Is our complaint just?  I don't know.  We just might be drumming up objections on behalf of our sweet-smiling agricultural folk who carry a lot of weight come election time. A bit like the case outlined below which is taken at the instigation of steelworkers in an economy in which manufacturing has been declining.

In short, the WTO probably saves us a few wars, armed conflicts and military skirmishes - which might have been the case a century or two ago.  To New York, the nations of the world take their trade disputes. International bureaucratic processes ensue and a long time later there is a response or a decision.  Well, you know what they say about conception and elephants, Networkers.

That long-winded intro is to tell you about what might be a little doozy for the WTO to decide - and innocent by-standers are left to their own conjecture on what it might be all about actually.

The Obama Administration in the USA has filed a complaint with the WTO over China's wind-power subsidies.  I learned this from my Daily Grist (see here). Based on my limited knowledge and limited ability to observe Australia's goings on at the WTO, the Grist assessment sounds reasonable.  The outline done by greentechmedia gives a good nuts and bolts description of the process. But we mustn't be one-sided about this, must we.  So over I popped to the New York Times.

The NYT highlights the involvement - or quiescence - of General Electric, a company not always known for sound environmental practice.  Further criticism of China is here in highlighting the way China is alleged to treat foreign companies in China.

I have to say though that I do find this response from an NYT reader of interest:
There is another side to this story, of course - namely, that both the Obama and Bush Administrations have focused on subsidizing the following:

1) Coal-to-gasoline plants (billions from the DOE, often cloaked as "CO2 capture projects")
2) Tar sand imports (billions in Congressional loan guarantees for new gas pipelines to feed the tar sand production system)
3) Liquefied natural gas imports (more billions to Exxon and Chevron for their Indonesian and Papua New Guinea LNG projects)
4) A new round of ridiculously expensive taxpayer-subsidized nuclear reactors ($8 billion in loan guarantees for Southern - Georgia nuclear plants).
There are many similar examples of the Obama-Bush focus on fossil fuels and nuclear - but solar and wind have received almost nothing in comparison.
Clearly, this could be challenged by China as unfair government support for fossil fuel & nuclear (which, despite the earnest claims of Energy Secretary Chu, are hardly "clean" and definitely not renewable) - but China is obviously more concerned with reducing its dependence on fossil fuel imports by moving state support away from fossil fuels and towards renewable energy.
The U.S. would be wise to follow suit - but the gross imbalance between U.S. subsidies for fossil fuels & nuclear over solar, wind and sustainable biofuels (algal biofuels & artificial photosynthetic approaches) has distorted U.S. energy markets and made investors very hesitant about putting their money into renewables - a situation which pleases the fossil fuel & nuclear cartels to no end.
Hence, the U.S., on energy, is running with cartel capitalism - not with competitive free market approaches - and should itself be subject to severe WTO penalties for such blatant market manipulation.

I suppose Networkers,
(bad pun warning!)
we shall have to wait and see which way the wind blows.

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