Following the announcement of anti-dumping duties on China-made solar cells that range from 31-250%by the US Department of Commerce,more anti-subsidy duties have been levied on China-made wind towers.The anti-subsidy duties for China-based wind tower makers range from 13.7-26%,according to a May 30 article by The New York Times.
The report stated that the US imported about US$222 million worth of China-made wind towers in 2011.
Wind and solar power are clean and renewable energy sources that can help the US lower its dependencies on crude oil or nuclear.Levying these duties on China-made products,which are relatively cheaper than US-made products,will likely slow down the process of adopting renewable energy sources.
The purpose for subsidizing an infant industry is to level the playing field and give the industry a kick-start.But with many countries are subsidizing the same infant industry,the playing field has been obscured.Leveling it makes no sense.
Furthermore,protectionism has been seen as a tool to secure domestic jobs and keep out competition.Unless a market has numerous players with similar weights and market shares,without competition,the dominant firm can set prices to its liking.This is likely to lead to monopoly or oligopoly conditions.
Subsidies from the government can come in various forms such as tax credits,land grants,and federal loan guarantees.Solyndra,a US-based solar firm that went bankrupt in 2011,received subsidies in the form of federal loan guarantees.This may be seen as"unfair subsidies"by the China government.
Switching to renewable energy sources to generate electricity has been a popular topic in recent years.In addition,many governments around the world have set policies to reduce the dependency on crude oil,fossil fuel,or nuclear power.To achieve the goal of making the planet a cleaner place to live relies on universal adoption of renewable energy sources.This means electricity-generating systems need to be affordable to everyone.Levying duties on cheaper renewable energy products is likely to increase the price of such products and is unlikely to make the US and the planet a cleaner place to live.
