The requirement that 50% of wind energy projects are sourced locally to qualify for Feed-in Tariff support in the Canadian province of Ontario is illegal, the World Trade Organisation has ruled. The ruling, following challenges byJapan and the EU, sends a clear message to other governments with such requirements for wind power – Brazil, South Africa, Turkey, Ukraine, Croatia – that local content requirements are incompatible with their WTO commitments.
“The European Commission must use the impetus provided by this ruling to enter discussions on an international free-trade agreement on renewable energy, tackling both tariff and non-tariff barriers, ensuring a level playing field for wind power products and services, with all willing parties,” says Justin Wilkes, Policy Director for the European Wind Energy Association (EWEA). “A free trade agreement on renewable energy goods and services would bring more renewable energy online and drive down costs.”
EU-based wind energy companies stand to benefit significantly from free trade. The sector exported Eur8.8 billion worth of products and services in 2010, up 4.2% on the previous year and up 33% since 2007, making net exports of Eur5.7 billion.