[Top News] from [REUTERS]
[Green Business]
Carbon tariff proposals unworkable: China WTO rep
Thu Oct 29, 2009 6:07am EDT
By David Stanway and Wang Lan
BEIJING (Reuters) - Proposals to impose "carbon tariffs" on countries that do not make efforts to reduce their CO2 emissions are unworkable and counterproductive, a Chinese trade representative said on Thursday.
Zhang Xiangchen, one of China's permanent representatives at the World Trade Organization in Geneva, said "all countries should firmly oppose" the proposals, which have been raised by both the European Union and the United States.
"It is very difficult to have a unified standard for levying carbon tariffs and the starting point (for the proposals) is to restrict competition from China," he said on the sidelines of a conference.
"Frankly, if tariffs are being implemented unilaterally, they cannot be objective and cannot be non-discriminatory."
Negotiations to expand or replace the Kyoto Protocol, whose first phase ends in 2012, will take place in Copenhagen in December. Observers fear that Doha-style wrangling could prolong the talks.
The Kyoto principle of "common but differentiated responsibilities" committed industrialized nations to mandatory cuts in greenhouse gas emissions, but developing countries were not obliged to follow suit.
The new U.S. climate bill now being deliberated by Congress includes a set of provisions that allow future administrations to impose "border adjustment measures" on imported goods, thereby restoring the competitive balance.
Climate negotiators have raised similar proposals, saying they could help prevent enterprises from outsourcing their operations to countries which do not force them to comply with costly emission targets, leading to what is known as "carbon leakage."
But China's Ministry of Commerce has already voiced its opposition to carbon tariffs, which it has described as "trade protectionism disguised as environmental protectionism."
"Up to now, whether it is the proposals in the U.S. climate bill or the comments by French President Sarkozy, the carbon tariffs are just a kind of deterrent used by developed countries to put pressure on developing countries, breaking the principle of 'common but differentiated responsibilities' and making them commit to their own emission cuts," Zhang told the conference.
He said retaliation would also be inevitable.
"The United States per capita emission rate is four times as big as China's. Does that mean we can impose 400 percent tax rates on all imported American goods? If so, the result is a global trade war that is good for no one and no use at all in the fight against climate change."
(Editing by Jeremy Laurence)
[Green Business]
China's renewable curbs a boon to big players
Thu Oct 29, 2009 6:29am EDT
By Leonora Walet, Asia Green Investment Correspondent
HONG KONG (Reuters) - China's efforts to curtail expansion in its renewable energy sector should brighten prospects for the country's more established wind equipment and solar companies, as curbs on excess capacity squeeze out smaller competitors.
Solar firm Yingli Energy Holdings, wind gear maker China High Speed Transmission and solar components company GCL-Poly Energy Holdings are likely to survive the reforms largely unscathed thanks to their strong balance sheets and massive production capacity.
For smaller companies, the government's plan to withhold approval of new investments and shut off funding for projects is likely to deliver a crushing blow for this part of the sector that makes up nearly 50 percent of the market.
"Sadly for many, the party's over even before it began," said KK Chan, chief executive of private equity firm Nature Elements Capital. "But this is something the sector needs now and is consistent with the government's long-term goal."
Earlier this month, China launched its latest attempt to rein in industrial overcapacity targeting key sectors, chief among them steel and cement.
The move, however, also included Beijing's first moves to restrict investment in the renewables sector. It comes after more than a dozen companies piled into wind equipment and polysilicon-making projects, encouraged by state policies and cash perks launched early this year.
PRICES WEAK
Despite its efforts, Beijing's hard-line stance on expansion is unlikely to end the industry's struggle with collapsing prices and massive overcapacity.
"Capacities at factories are just so huge, China could easily supply all of the world's expected solar demand next year," said Wendy Wang, analyst at Yuanta Securities (Hong Kong).
Renewable energy accounts for just a fraction of a percent of China's total electricity output. Coal-dependent China hopes to bring that up to 15 percent by 2020.
By the end of 2009, capacity at China's polysilicon firms will reach 52,200 metric tons, according to Yuanta.
That's equivalent to feeding solar power stations with a combined capacity of 8.0 gigawatts, which is sufficient to supply the energy needs of a country the size of the Philippines.
Global solar demand in 2010 is expected at just 7.0 gigawatts and the over-supply has hammered prices.
Spot prices of polysilicon have fallen to $63 a kilogram now, from its peak of over $400 in August last year and compared to global production costs around $30-50 kg.
Larger, better resourced and more efficient polysilicon makers such as GCL, LDK Solar Co and Renesola are expected to better withstand the slimmer margins than newer, smaller rivals.
WIND
Wind turbine prices have also slipped as combined capacity builds to hit an estimated 40 gigawatts this year, also far surpassing demand. China is estimated to add on average 10 to 15 GW of wind power yearly.
Xinjiang Goldwind Science and Technology Co and Dongfang Electric are among biggest of 70 Chinese wind turbine suppliers.
"The wind turbine market has become competitive arena this year and price pressure will increase in 2010," said KGI analyst Stephen Wang.
GCL-Poly Energy, Yingli Energy, and China High Speed Transmission remain top picks by many brokerage houses in the renewables sector, thanks to their strong output and a wider customer base which is helping boost margins.
Shares in these companies have risen over 70 percent this year.
(Editing by Lincoln Feast)
[Green Business]
Carbon tariff proposals unworkable: China WTO rep
Thu Oct 29, 2009 6:07am EDT
By David Stanway and Wang Lan
BEIJING (Reuters) - Proposals to impose "carbon tariffs" on countries that do not make efforts to reduce their CO2 emissions are unworkable and counterproductive, a Chinese trade representative said on Thursday.
Zhang Xiangchen, one of China's permanent representatives at the World Trade Organization in Geneva, said "all countries should firmly oppose" the proposals, which have been raised by both the European Union and the United States.
"It is very difficult to have a unified standard for levying carbon tariffs and the starting point (for the proposals) is to restrict competition from China," he said on the sidelines of a conference.
"Frankly, if tariffs are being implemented unilaterally, they cannot be objective and cannot be non-discriminatory."
Negotiations to expand or replace the Kyoto Protocol, whose first phase ends in 2012, will take place in Copenhagen in December. Observers fear that Doha-style wrangling could prolong the talks.
The Kyoto principle of "common but differentiated responsibilities" committed industrialized nations to mandatory cuts in greenhouse gas emissions, but developing countries were not obliged to follow suit.
The new U.S. climate bill now being deliberated by Congress includes a set of provisions that allow future administrations to impose "border adjustment measures" on imported goods, thereby restoring the competitive balance.
Climate negotiators have raised similar proposals, saying they could help prevent enterprises from outsourcing their operations to countries which do not force them to comply with costly emission targets, leading to what is known as "carbon leakage."
But China's Ministry of Commerce has already voiced its opposition to carbon tariffs, which it has described as "trade protectionism disguised as environmental protectionism."
"Up to now, whether it is the proposals in the U.S. climate bill or the comments by French President Sarkozy, the carbon tariffs are just a kind of deterrent used by developed countries to put pressure on developing countries, breaking the principle of 'common but differentiated responsibilities' and making them commit to their own emission cuts," Zhang told the conference.
He said retaliation would also be inevitable.
"The United States per capita emission rate is four times as big as China's. Does that mean we can impose 400 percent tax rates on all imported American goods? If so, the result is a global trade war that is good for no one and no use at all in the fight against climate change."
(Editing by Jeremy Laurence)
[Green Business]
China's renewable curbs a boon to big players
Thu Oct 29, 2009 6:29am EDT
By Leonora Walet, Asia Green Investment Correspondent
HONG KONG (Reuters) - China's efforts to curtail expansion in its renewable energy sector should brighten prospects for the country's more established wind equipment and solar companies, as curbs on excess capacity squeeze out smaller competitors.
Solar firm Yingli Energy Holdings, wind gear maker China High Speed Transmission and solar components company GCL-Poly Energy Holdings are likely to survive the reforms largely unscathed thanks to their strong balance sheets and massive production capacity.
For smaller companies, the government's plan to withhold approval of new investments and shut off funding for projects is likely to deliver a crushing blow for this part of the sector that makes up nearly 50 percent of the market.
"Sadly for many, the party's over even before it began," said KK Chan, chief executive of private equity firm Nature Elements Capital. "But this is something the sector needs now and is consistent with the government's long-term goal."
Earlier this month, China launched its latest attempt to rein in industrial overcapacity targeting key sectors, chief among them steel and cement.
The move, however, also included Beijing's first moves to restrict investment in the renewables sector. It comes after more than a dozen companies piled into wind equipment and polysilicon-making projects, encouraged by state policies and cash perks launched early this year.
PRICES WEAK
Despite its efforts, Beijing's hard-line stance on expansion is unlikely to end the industry's struggle with collapsing prices and massive overcapacity.
"Capacities at factories are just so huge, China could easily supply all of the world's expected solar demand next year," said Wendy Wang, analyst at Yuanta Securities (Hong Kong).
Renewable energy accounts for just a fraction of a percent of China's total electricity output. Coal-dependent China hopes to bring that up to 15 percent by 2020.
By the end of 2009, capacity at China's polysilicon firms will reach 52,200 metric tons, according to Yuanta.
That's equivalent to feeding solar power stations with a combined capacity of 8.0 gigawatts, which is sufficient to supply the energy needs of a country the size of the Philippines.
Global solar demand in 2010 is expected at just 7.0 gigawatts and the over-supply has hammered prices.
Spot prices of polysilicon have fallen to $63 a kilogram now, from its peak of over $400 in August last year and compared to global production costs around $30-50 kg.
Larger, better resourced and more efficient polysilicon makers such as GCL, LDK Solar Co and Renesola are expected to better withstand the slimmer margins than newer, smaller rivals.
WIND
Wind turbine prices have also slipped as combined capacity builds to hit an estimated 40 gigawatts this year, also far surpassing demand. China is estimated to add on average 10 to 15 GW of wind power yearly.
Xinjiang Goldwind Science and Technology Co and Dongfang Electric are among biggest of 70 Chinese wind turbine suppliers.
"The wind turbine market has become competitive arena this year and price pressure will increase in 2010," said KGI analyst Stephen Wang.
GCL-Poly Energy, Yingli Energy, and China High Speed Transmission remain top picks by many brokerage houses in the renewables sector, thanks to their strong output and a wider customer base which is helping boost margins.
Shares in these companies have risen over 70 percent this year.
(Editing by Lincoln Feast)