Brussels aims to remove Chinese energy giants from the EU market
World
Brussels aims to remove Chinese energy giants from the EU market
(AFP) - The probe is just the latest move by Brussels targeting the country over green tech subsidies suspected of undermining fair competition.
The European Commission will look into conditions for the development of wind parks in France, Spain, Greece, Romania, and Bulgaria.
EU anti-trust commissioner Margrethe Vestager said on Tuesday that the Commission is putting into effect a law that was designed to decrease imports of products by companies that are subsidised by their home countries.
Vestager did not name the Chinese companies that will be investigated by the European Union's executive during a lecture delivered on Tuesday at the Institute for Advanced Study in Princeton, New Jersey, in the United States.
We are concerned that certain wind manufacturers may benefit from unfair foreign subsidies.
An investigation carried out under the Foreign Subsidies Regulation (FSR,) which was introduced on 12 July 2023, allows Brussels to probe companies bidding in public tenders in the bloc larger than €250 million.
French energy companies
“We fully understand the Commission’s rationale,” says Giles Dickson, the CEO of WindEurope, a lobby group for the industry.
“Chinese wind turbine manufacturers are offering much lower prices than European manufacturers and incredibly generous financing terms with up to three years deferred payment," he says.
"You can’t do that without unfair public subsidy. What’s more the European manufacturers aren’t allowed to offer deferred payment like that under OECD rules.”
The investigation and steps that may follow, are likely to affect the French energy companies in their choice of material.
In November, S&P Global Market Intelligence reported that French energy provider Neoen was "waiting for 'green light' from banks to buy Chinese wind turbines," as turbines manufactured by Western companies are "persistently expensive due to inflated raw materials costs."
Quoting Neoen's CEO Xavier Barbaro, S&P said that "Neoen is already dependent on China for its supply of solar panels and, as such, is on board with the prospect of Chinese turbines and their bankability."
Angry reaction
China doesn't agree. In a first, angry reaction, the Brussels-based China Chamber of Commerce to the EU (CCCEU) Beijing issued a statement, saying that they "firmly oppose" the investigation.
"While deliberately ignoring the significant subsidies granted by certain countries to their emerging green industries, the European side has imposed obstacles and market barriers against Chinese enterprises operating in the green sector," according to the CCCEU.
"This not only contravenes the principles of fair market competition but also undermines the EU's commitment to enhancing international cooperation in global emission reduction and low-carbon coordination.
In Beijing, foreign ministry spokeswoman Mao Ning criticised EU "protectionism", telling journalists it "protects backwardness... and causes multiple losses".
"China is highly concerned about the discriminatory measures taken by the European side against Chinese enterprises and even industries," she added, "protectionism does not solve one’s own problems."
Solar panels and EV's
It is the third time that Brussels is applying the FSR against China.
Earlier FSR investigations targeted Chinese subsidies for solar panels, electric cars and trains.
The EU opened its first probe under the FSR in February, targeting a subsidiary of Chinese rail giant CRRC, the world's largest rolling stock manufacturer in terms of revenue.
That investigation was closed after the subsidiary withdrew from a tender in Bulgaria to supply electric trains.
A second probe announced last week targets two Chinese-owned solar panel manufacturers seeking to build and operate a photovoltaic park in Romania, partly financed by European funds, Longi Green Energy Technology, the world's biggest solar panel manufacturer and the state-owned Shanghai Electric group.
Earlier on, the EU carried out investigations into the imports of Chinese electric vehicles (EVs.)
Last month, the EU Commission said it found evidence of "massive imports" of Chinese electric vehicles in a relatively short period, including a “substantial increase” of 14% since the investigation was launched in September, and on March 5, Brussels published rules to limit the import of EVs from China.
