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Market-friendly principles can be used to build local networks says GWEC Government and industry should work together to develop market-friendly principles that build local supply chain capabilities without resorting to restrictive and damaging policies like tariffs and local content requirements, according to a new paper from the Global Wind Energy Council. An Industry Perspective on Localisation: Pro-business Measures to Drive Local Industrial Development outlines how the strategic development of local supply chains—when done with flexible, market-friendly policies—can drive economic growth and energy transition goals. However, when localisation is pursued through rigid LCRs, it risks reducing international investment, raising costs, and slowing wind power deployment, according to the report. Successful localisation is not about closing markets but about opening opportunities, said Stewart Mullin (pictured), GWEC’s chief industry officer. Local manufacturing capabilities will thrive when countries align industrial, energy, and infrastructure policies to create predictable, investable environments. Supply chain localisation will build resilience, but policy must avoid strict local content requirements and tariff barriers, which can increase costs and undermine healthy competition. “The way to build a capable local industrial capacity is to pursue well-designed and effective incentive-based policies, such as training programmes, R&D funding, and infrastructure investment. The case studies provided by our members prove how these are more effective than protectionist measures in fostering sustainable local wind industries. The report draws on case studies from Taiwan, South Africa, Denmark, India, and Poland, highlighting practical, positive pathways for localisation. It emphasises the importance of training local workforces, leveraging existing industrial capabilities, and fostering regional collaboration. The report details seven key principles that set out the industry’s preferred strategic framework to build up local industrial capabilities. These include harnessing the benefits of international competition; ensuring policy coherence across domains and governance levels; a focus on establishing continuity and predictability of the market; and leveraging local industrial strengths. It also includes providing market incentives to attract investment; assessing and empowering the local workforce; and considering regional collaboration. The wind industry calls on policymakers to consider localisation strategies that are incentive-based, aligned across sectors, and time-bound when LCRs or equivalent restrictive policies are used. With wind power deployment expected to accelerate this decade, getting localisation right is crucial for both long-term energy security and economic prosperity, GWEC said. |
