CCID Commentary: Understanding the "Wind" Indicator from a Tariff List

The global wind energy competition is entering a new phase. The UK Department for Business and Trade recently announced the removal of tariffs on 33 wind turbine components starting April 1st, with tariffs on core parts like blades and cables reduced to zero. This is expected to unlock approximately £22 billion (over 200 billion RMB) in investment and accelerate offshore wind installations in the North Sea. Almost simultaneously, China’s leading wind and offshore engineering company, Dajin Heavy Industries, signed an agreement with a Polish state-owned shipyard to supply 40 sets of core foundation components for projects in the North Sea of Germany. These “reductions” and “agreements” ignite new possibilities for Chinese wind power going global.

Energy security is the direct reason behind Europe’s shift in wind power policy. Recently, the lingering effects of the Russia-Ukraine conflict, combined with the volatile Middle East situation, have once again pushed up oil and gas prices amid tensions in the Strait of Hormuz. Europe’s energy security concerns have reached a peak, exposing the fragility of dependence on external energy sources. Against this backdrop, the third North Sea Summit adopted the “Hamburg Declaration,” which explicitly calls for strengthening cross-border cooperation on North Sea wind power networks, aiming to make the North Sea Europe’s largest green energy hub. The goal is to reach a combined offshore wind capacity of 100 GW by 2050, elevating offshore wind to a strategic level of “energy security necessity.”

From resource conditions, wind power is a better renewable energy option. The North Sea has some of the world’s highest-quality offshore wind resources, making it an ideal location for offshore wind farms. Coastal countries developing offshore wind do not encroach on inland resources. In contrast, photovoltaic power generation faces limitations due to frequent cloudy weather and high cloud cover in the North Sea region, which significantly impacts solar radiation and limits solar power potential.

However, the gap between ideals and reality is vast. Despite many countries setting ambitious wind installation targets, Europe’s offshore wind grid connection progress is severely lagging. More challenging is the “bottleneck” in local supply chains. Rapidly increasing wind turbine installations require large quantities of turbines to be delivered quickly, but rising steel prices due to the energy crisis have eroded the cost competitiveness of domestic European manufacturers. Europe’s wind power capacity cannot meet long-term demand, creating a large supply-demand gap that must be filled externally.

The UK’s removal of tariffs on wind components is essentially a pragmatic compromise: abandoning some trade protections to accelerate project deployment and control costs. For a long time, Chinese wind power companies have faced an imbalance of “strong domestic, weak overseas,” struggling to break into high-end international markets. This policy shift opens the door for Chinese wind companies to enter Europe’s high-end market.

Europe’s offshore wind demand is booming, and globally, only China can meet this surge. Bloomberg New Energy Finance data shows that by 2025, China will dominate the top ten global wind turbine manufacturers, holding eight seats and taking the top six spots for the first time. Goldwind ranks first worldwide, followed by Envision and Mingyang Smart Energy, while Western giants like Vestas lag behind. Chinese companies’ overseas grid-connected capacity has grown eightfold in the past year. Amid shrinking domestic profit margins, Chinese manufacturers are entering new markets through low-cost manufacturing and rapid delivery, gaining price advantages over competitors in Latin America, the Middle East, Africa, and Asia. From large-scale turbines to AI-powered wind turbines, Chinese firms have shifted from followers to leaders, beginning to define industry standards.

More importantly, Chinese wind power companies’ overseas expansion has gone beyond simple product exports to an ecosystem of “capacity + standards + services.” In response to new trade barriers like the EU’s Carbon Border Adjustment Mechanism, Chinese companies are localizing factories and operations, transforming from exporters into co-builders of Europe’s energy security, effectively avoiding trade risks and integrating into local industrial ecosystems. This “co-construction” model allows Chinese wind power to secure more sustainable development space amid the global energy transition.

While Europe’s market doors are open, the “channels” to the North Sea still face challenges. EU carbon tariffs, geopolitical frictions, and localization requirements are hurdles Chinese companies must overcome. Additionally, domestic competitors’ low-price “internal competition” poses risks: if profit sacrifices are made to win overseas orders, it could harm the industry’s overall interests and trigger new trade disputes.

The real test lies in moving from temporary positions to establishing a firm foothold. As Europe’s local supply chains gradually recover and geopolitical tensions ease, how will Chinese companies leverage technological innovation and deep services to stay? The answer lies in deep integration: achieving localized management, aligning with local laws, labor, and industry environments, and avoiding becoming “one-time substitutes.” Transitioning from product exports to capability and ecosystem exports, Chinese wind power will continue to blow across broader seas in the wave of global energy transformation.
(Source: Economic Daily, Author: Wang Yichen)