International Trade's Impact on Wind Energy: A Case Study (HI5016)

This report analyzes the impact of international trade on the wind energy industry, with a specific focus on Australia, China, and India. It examines the installed wind capacity trends, highlighting the growth in investment by China and India compared to Australia. The report discusses the terms of trade for these countries, considering government policies, particularly subsidies, and their effects on the wind energy sector. It explores both the advantages and disadvantages of wind energy, including the impact of subsidies, the role of foreign investment, and the challenges associated with its implementation. The analysis covers the importance of consumer behavior, economic development, and the influence of government subsidies on the wind energy industry, including their positive and negative aspects. The report concludes by summarizing the key findings and offering recommendations for the future of international trade and wind energy development.

International trade-wind energy

Introduction
•The study will analyze the impact of
international trade on wind energy.
• The international trade is affecting the wind
energy industry will also be discussed.
•This is significant in the sense that it will analyze
the terms of trade for the countries like Australia,
China and India.
•Moreover, the study will also consider the terms of
trade for these countries regarding the policies that
is taken by the government regarding the subsidies
in the industries.

Wind energy industry
•Moreover, Australian economy is having huge
supply of minerals and the growth of the rapid
industrialization is going to increase the demand
of other economy regarding the consumption of
these minerals.
•Australian economy is having surplus of energy
and the presence of the high terrain and open land
is fuelling the urge of the wind energy (Chalvatzis
and Ioannidis, 2017).
•The graph below is showing Australia is having
continuous and stagnant growth regarding
installed wind capacity from 1997 till 2016.
•Until 2006, the investment in the wind energy
was showing a constant move but after that, India
and China started to increase their investment in
the wind energy (Curran et al. 2017).
1997
2000
2003
2006
2009
2012
2015
0
20
40
60
80
100
120
140
160
180
200
Installed Wind capacity
(gigawatts)
India
China
Australia
Volume of wind energy

Contd..
•Another important negative impact is that
subsidy in wind energy shift the
consumption of oil from the developed
nations to the developing nation.
•Taking the consideration of the wind
energy and the sustainability in the wind
energy is going to increase the
development of the oil consumption.
•This is because in the initial phase of
development and the developing nations
will not have that level of capacity to
install wind stations (Jebli and Youssef,
2015).

Advantage regarding wind energy industry
•Since the outer structure of the market in the
Asian countries is, improving and they are
going to develop the investment in the wind
energy more in the upcoming years.
•Using the high growth in the bilateral trade
the economies like China and India will look
to bring high amount of investment from
foreign countries in their renewable resources.
•However, these kinds of energy cannot be
transferred but the indulgence of investment in
these energies will increase.

Countries with less population and GDP have
been benefited with development of wind energy
•Moreover, through the incorporation of better service
in the installation of wind energy is going to help a lot
to the economy.
•Through the involvement of better introduction of the
wind energy, the demand and supply of energy will
maintain strong correlation.
•This will obviously allow the economy to increase
the resources.
•The above diagram is showing the fact that United
States, Japan and Canada are increasing their
investment opportunity and purchasing power
regarding the wind energy.
Brazil
Canada
China
Egypt
Germany
India
Japan
Mexico
South
Korea
United
Kingdom
United
States
0 20000 40000 60000 80000
GDP (in billion US dollar)
Population (in millions)
Per Capita GDP (in US Dollar)

Terms of Trade (ToT) in wind energy industry
•.This will automatically highlight the importance of consumer
behavior so that the incorporation of better development is
possible.
• It is going to bring changes in the economy that will
automatically bring in enough improvement in the standard of
living.
•Mostly the energy in Australia are having surplus in the
mining and minerals that will automatically indulge the
improvement in the economy.
•Through the development of the economy, the information
spread is essential in the sense that it will determine the
improvement in the economy.

Significance of subsidy in wind energy
•In the modern trade and commerce, one of the
most highlighted issues that have popped up in
Australia is the huge rate of reduction in the
subsidy mostly in solar and wind energy.
•Most of the economists argue that all the
renewable resources can be developed and
operated at $55-70/MWh and they do not need
any kind of government subsidies.
•Provision of subsidies in the wind energy is
taking away the wind and solar energy from the
best possible sites

Positive impact of subsidising wing energy
•The wind energy is one of the cost
effective method of energy production.
•One of the efficient land based project
is going to increase the resource
distribution and channelization of
resources.
•In 2016, the wind sector employed
more than 100,000 employees and
wind turbine technician is one of the
fastest growing jobs in America

Challenges or negative aspects of wind energy
• However, in order to operate the wind
energy, the external use of electricity will
be required as the wind turbines are
located outside the city.
• In order to generate the turbines
electricity is any form is required which
increases costs of production.

Subsidies in Wind energy industry
•Support and subsidies for wind energy fell
by almost 80% between 2013 and 2016.\
•The amount of subsidy came down to
about $1.27 billion.
•The main reason behind this fall in share
in subsidy is the fall in the direct
expenditure (ETEnergyworld.com, 2018).

Conclusion and Recommendation
•The whole study is going to highlight the fact
that through the incorporation of better
development of the business, countries like
India, Australia and China are developing their
international trade.
•Through the involvement of the better trade
and commerce will definitely allow the
incorporation of better resource utilization that
will definitely allow the improvement in the
FDI regarding the investment in the wind
energy.

Reference list
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capabilities and global production networks in South Africa's wind and solar
photovoltaic (PV) industries. Political Geography, 60, pp.1-12.
•Bento, N. and Fontes, M., 2015. The construction of a new technological
innovation system in a follower country: Wind energy in Portugal. Technological
Forecasting and Social Change, 99, pp.197-210.
•Chalvatzis, K.J. and Ioannidis, A., 2017. Energy supply security in the EU:
Benchmarking diversity and dependence of primary energy. Applied energy,
207, pp.465-476.
•Curran, L., Lv, P. and Spigarelli, F., 2017. Chinese investment in the EU
renewable energy sector: Motives, synergies and policy implications. Energy
Policy, 101, pp.670-682.
•Economy, t. (2019). 12 Negative Aspects of subsidy in wind energy |
OilPrice.com. [online] OilPrice.com. Available at:
https://oilprice.com/Finance/the-Economy/12-Negative-Aspects-of-
Globalization.html [Accessed 22 Apr. 2019].
•ETEnergyworld.com. (2018). India’s energy subsidies declined by 36 per cent
from FY14 to FY17: Report - ET EnergyWorld. [online] Available at:
https://energy.economictimes.indiatimes.com/news/power/indias-energy-
subsidies-declined-36-per-cent-from-fy14-to-fy17-report/67177117 [Accessed
23 Apr. 2019].