The EU has triggered dispute procedures under World Trade Association (WTO) rules with the UK, saying that the ‘supply chain plans’ required by the UK from companies who bid for Contracts for Difference (CfDs) breach WTO rules.
The EU has formally “requested consultations” on “the UK’s discriminatory practices when granting support for green energy projects”.
The UK requires – and qualifies – supply chain plans for all projects over 300MW that show how local content will be included in the project. It recently announced plans to raise the bar on such plans, which mostly affect offshore wind.
The EU argues that this favours UK over imported content when awarding subsidies and “This violates the WTO’s core tenet that imports must be able to compete on an equal footing with domestic products and harms EU suppliers, including many SMEs, in the green energy sector.” It also says “such practices ultimately increase costs of production and thereby risk slowing down the deployment of green energy” – local content criteria lead to losses in efficiency and raise prices for consumers, ultimately making the transition to a secure supply of renewable energy more difficult and costly.
The EU says that its wind energy sector had an annual turnover of €36 billion in 2018 and provides 500,000 high quality jobs. “Discriminatory trade practices, such as the UK ones challenged today, encourage the move of investments away from the EU, impacting the EU’s competitiveness in the sector and in general undermine efforts to address the climate crisis.”
The EU said it had previously raised its concerns with the UK on several occasions, but to no avail.
The dispute settlement consultations that the EU has requested are the first step in WTO dispute settlement proceedings. If they do not lead to a satisfactory solution within 60 days, the EU can request the WTO to set up a panel to rule on the matter.

Further reading
BEIS acts to tighten UK supply chain requirements on CfDs and extend regime to floating wind