Wind Turbine Tariffs by country, from the World Trade Organization
(Kellen Henry/MNS)
WASHINGTON—The U.S. could fall behind in the green technology race and lose the potential to create hundreds of thousands of new jobs if it does not bolster its trade export policies in the environmental sector, several government and industry experts told a House committee Wednesday.
Witnesses before a House subcommittee on energy stressed the need for stronger intellectual property rights and overcoming market barriers like high tariffs imposed by other countries.
“Early development and commercialization of green technologies are critical to the competitiveness of U.S. firms,” said Mary Saunders, acting assistant secretary for manufacturing and services in the Commerce Department’s International Trade Administration.
The Department of Energy estimates that the U.S. green technology industry could reach $40 billion in exports and could create more than 750,000 jobs over the next 10 years.
However, the U.S. faced a deficit of $8.9 billion in renewable energy and other environment-related industries last year, according to research by the New America Foundation, a progressive think tank. And only six U.S. companies rank in the top 30 green energy companies in the global market, noted Rep. Bobby Rush, D-Ill., chairman of the House Commerce subcommittee on energy and trade.
To create better end markets to grow those prospective jobs, the U.S. must lead a global effort to stimulate trade, said Timothy Richards, managing director of international energy policy at General Electric Co.
“Even as they call for sources that would enhance energy security and reduce emissions, many governments maintain barriers to trade in the very goods needed to realize those projects,” Richards said.
Richards cited wind turbine tariffs, levied by the majority of World Trade Organization members. Brazil’s wind turbine tariff is 14 percent, with China following behind at 8 percent and India at 7.5 percent.
“The U.S. also has a tariff on these products, but it’s only 1.3 percent,” he said, making it less profitable for U.S. companies and more profitable for foreign companies to produce the turbines for export.
Countries also impose import bans, quality and certification standards and preferential bidding for domestic firms to create barriers.
“We’ve got stuff masquerading as quality control, but really it’s protection,” said Rep. John Barrow, D-Ga.
Barrow said the U.S. needs overcome international barriers by negotiating better trade arrangements with other countries rather than providing federal subsidies to green industries.
“We respond … by not addressing that problem,” Barrow said. “We turn to the taxpayer to try to jumpstart our economy. We’re playing on an unlevel playing field.”
But Saunders and some industry leaders said it’s important to provide incentives for innovation at home.
“You can’t export what you don’t manufacture,” she said.
Lisa Jacobson, president of the Business Council for Sustainable Energy, told the committee that the U.S. should continue to support the manufacturing sector with initiatives like the Energy Department’s loan guarantee program, manufacturing tax credits and the adoption of a national renewable electricity standard.
“Sending the right signals at home through the adoption of domestic investment and manufacturing incentives, coupled with strong coordinated and long-term policy commitments to clean energy sectors is critical,” she said.