Government Support in the Solar and Wind Value Chains

Oecd

No 288, OECD Trade Policy Papers from OECD Publishing

Abstract: The past two decades have witnessed profound changes in the value chain for solar modules and wind turbines. These changes have gone in hand with growing concerns about excess production capacity, concentration of supply, and the subsidies that some governments provide to their manufacturers of solar and wind equipment. Against this background, this paper provides detailed, firm-level evidence on the scope and scale of government support for the production of solar modules and wind turbines throughout the period 2005-23. The analysis finds subsidies to have been generally larger for producers of solar modules than for producers of wind turbines. Until recently, China-based producers had been the largest recipients of government support by a significant margin in both solar and wind but recent measures introduced in OECD countries have translated into a notable increase in 2023. These findings underscore the trade-offs governments can face between climate objectives and fair competition.

Keywords: Industrial policy; Renewable energy; Subsidies; Trade policy (search for similar items in EconPapers)
JEL-codes: F13 H25 H81 O25 Q48 (search for similar items in EconPapers)
Date: 2025-01-15
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Persistent link: https://EconPapers.repec.org/RePEc:oec:traaab:288-en

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