I mentioned earlier today that Europe's trade policy on sugar appears to be a piece of monstrous idiocy. And yet now I find something even worse, evidence that the lunatics have escaped their asylum and have taken over the entirety of this lovely and beauteous continent. They're imposing import tariffs on cheap Chinese solar cells. This at the same time as vast swathes of public policy are devoted to the idea that we've got to have cheap renewable power in order to save our entire species from boiling itself. We're also spending hundreds of billions to make such cheap renewables a reality. So, when someone comes knocking at the door asking if we'd like to purchase some cheap our answer is to try and tax them for their temerity?
Seriously people, how did we end up with an entire continent, the cradle of modern civilisation, adopting such an insane public policy?
The news is here:
The European Union has applied sharp tariffs on Chinese solar-panel makers Canadian Solar, ReneSola and ET Solar, kicking the companies out of a pact with the Chinese industry that allowed them to export to Europe with minimal tariffs.The three companies were found to be in violation of the 2013 agreement that required the export of solar panels above a minimum price and abide by several other conditions.
We what? We're insisting upon a minimum price at the risk of 70% import duties? Apparently so:
The move is part of a long-running battle between the Chinese solar panel industry and manufacturers in Europe and the U.S. Western producers say that the Chinese firms, fed by hefty Chinese government subsidies, have built up huge overcapacity and are dumping their surplus products into Western markets at unfairly low prices.
...
The commission also questioned the practice by Canadian Solar and ReneSola of selling solar cells to firms in non-EU countries for assembly into panels that are then sold to the EU. Because the EU tariffs only apply to panels coming from China, the practice, though not a direct violation of the agreement, allows the two firms’ solar cells to enter the 28-nation EU unrestricted by the agreement.
This is madness. Pure, unrestricted, no we're not going to let you out of that straitjacket matey, lunacy.
So let's go back to the beginning. I might not think that climate change is as great a worry as some others do, although I do agree that it's something that we do want to do something about. And I agree with the general thrust of public policy which is that the solution is in working out how to have renewably generated power that is as cheap as that generated by fossil fuels. Once, for example, solar cells cross over to being cheaper than coal generated energy from the grid then we'll all quite naturally start installing solar panels and we'll largely be solving that climate change problem.
I might argue that the way to do this is a carbon tax plus a bit of strategic R&D cash (as Lord Stern recommended in his report, as Bjorn Lomborg suggests, as Nordhaus and Tol, the economists on the ball here insist) but I'm still onside with the idea that this is our goal. Even if I don't like the systems of feed in tariffs and so on which are a much more expensive manner of getting to that same goal.
We're also spending trillions of euros to try to achieve this goal. No, really, across the continent it is trillions over the years: Germany is said to have spent a trillion alone. And our goal is that someone will walk in the door and say, you know what? I've got some cheap solar cells here, would you like some? No, seriously, that is what the goal is. If we can find someone, anywhere, who can make cells cheaply enough that the electricity derived from them costs 6 to 10 cents a kWhr then we're done. Everything else simply falls into place once we can in fact generate cheap electricity without emissions.
So, here's our man (or three companies) hawking cheap solar cells. And instead of welcoming them in, offering a cup of tea as we haggle over pricing, we're taxing them to make sure they can't sell us any of their nice, cheap, solar cells? It would be funny if it weren't so depressing.
That the suspicion is that those cells are cheap because of Chinese government subsidy doesn't change this point in the least. Everyone in this space is getting subsidy. If nothing else, from those feed in tariffs that I'm not so keen on. At which point we seem to have the Guardians of European Purity insisting that our subsidies are just fine but not your nasty foreign ones. Which is absurd of course: it's obviously better for the living standards of Europeans that Chinese people get to subsidise their solar cells than that Europeans have to subsidise their own.
There is no way out of this either. The European Union itself controls trade policy and there are no elections to that European Union. It's not even possible to turn the lunatics out every few years. So what a way to run a continent, eh? We have public policy spending vast sums to gain us cheap solar cells, then when someone turns up with cheap solar cells public policy is to tax him to make sure he cannot sell or supply any cheap solar cells. What possible description for this do we have other than flat out lunacy?
My only hesitation in so describing it is that this is being unbearably rude to those who really are mad and are seeking treatment for their ailment. Would that we could have compulsory commitment for institutions.
