Germany’s biggest utility has warned that a US ban on imports from China’s Xinjiang region could “significantly hinder plans to build a green energy infrastructure”.
RWE said on Tuesday that the import of solar modules from Asia was now subject to “stringent checks” after Washington last year enacted a ban on all imports from the Chinese region where there have been allegations of human rights violations.
Germany’s largest power producer, which has expanded aggressively into renewable energy, including in the United States, said it had suffered “considerable project delays” as a result of what it called the time-consuming reviews of solar module deliveries.
The company describes itself as the fourth-largest renewable energy player in the US and the second-largest owner-operator of solar farms in the country.
“State-imposed restrictions on cross-border trade could also significantly hinder plans to build a green energy infrastructure,” the company said in its annual report. “We see an elevated risk of this being the case in the USA.”
It added: “If the USA continues to impede the procurement of solar panels, then it is possible that our photovoltaic expansion initiatives could fall behind schedule.”
At a press conference to announce RWE’s full-year results, chief executive Markus Krebber said that the company was not advocating that the US legislation, known as the Uyghur Forced Labor Prevention Act, be unwound.
The solution, Mr Krebber said, was to beef up solar supply chains in the US and Europe. “The right conclusion if we now need [significantly] more solar panels, turbines cables, whatever, cannot be to water down the standards ... We need now to ramp up the European supply chain as the US is ramping up their supply chain.”
RWE’s remarks make it one of the only western companies to publicly voice concerns about the effects of legislation designed to pressure Beijing over Xinjiang. The United Nations has warned that crimes against humanity may be taking place against interned Muslim Uyghur and other minorities in the region. China denies the claims.
The delays suffered by RWE also underline the tension between the Biden administration’s ambitions to boost renewable energy production and its efforts to upbraid China. The European Union also faces a similar dilemma.
RWE’s intervention came as the company reported better than expected earnings before interest, taxes, depreciation and amortisation of €6.3 billion for last year. The group pledged to raise its dividend in 2023 and scale up its investments in renewables. – Copyright The Financial Times Limited 2023
