Friday, September 17, 2010

Japan Challenges Canadian Renewable Energy Incentives at WTO

(Bridges Weekly)

Japan launched dispute settlement proceedings against Canada at the World Trade Organization on September 13 by saying that the province of Ontario’s green energy plan unfairly pressures its producers of clean power to buy hardware from local manufacturers.

Specifically, Japan is challenging Ontario’s Feed-in Tariff Program (FIT), which enables the province to subsidise electricity operators that use renewable energy produced using stringent local content requirements. The “made-in-Ontario” requirement demands that up to 60% of all green energy project inputs be manufactured in the province as it strives to create local jobs. [...]

But Japan says the local-content provisions breach portions of the General Agreement on Tariffs and Trade (GATT), and fall under the definition of a “prohibited subsidy.” It has asked for “consultations” with Canada under the WTO process, the first stage of a formal trade dispute. Read more here.