The Compatibility Research Of China’s Renewable Energy Subsidies Under The SCM Agreement

Energy as the foundation of social economy development, has always been the focus point of world attention. For the purpose of easing energy supply and demand contradiction and reducing greenhouse gas emissions, countries began to develop renewable energy industry in order to replace the using of traditional energy. The beginning of renewable energy industry development needs high investment cost and high-tech support. So renewable energy industry can’t develop rapidly without countries’ financial subsidies. But in the process of international trade of renewable energy equipment and production, the countervailing investigations triggered by China’s renewable energy subsidies are becoming more and more common which have brought huge impact to related enterprises. In order to avoiding further more countervailing investigations and providing some reference to the enterprises which are dealing with the investigation, the paper will analysis the subsidies’ compliance of SCM agreement and find out the violation.In China renewable energy trade disputes, there always be two focus points of debate, the identified problem of state-owned enterprise and the choice of external benchmark. On the basis of SCM Agreement, the paper will find out which subsidy may be in violation of the SCM agreement. And the development of renewable energy subsidies systems of Europe and United States is relatively complete. The biding development goals in laws and scientific and logical subsidy system are worthy to learn and referent to China, so as to improve renewable energy legislation and reduce the risk of countervailing investigation.Aimed at the problems that exist in China renewable energy subsidy, the paper puts forward three solutions. Firstly, the subsidies which directly conflict with SCM agreement need to be changed, which has specificity should be avoided, which stipulated local ingredients or exportation as the condition of granting subsidies should be forbidden. Also the improvement of China’s renewable energy tariff andquota system should be accelerated, starting from the current situation of renewable energy industry development in our country, learning from Europe and United States national subsidy system. Secondly, expand the survival environment to the renewable energy subsidies under the SCM agreement, make them conform to the law in certain conditions. Last but not least, in order to reduce the subsidies gradually, developing international energy cooperation mechanism under the guidance of “one belt and one road” strategy, setting up subsidies which are compliant to SCM Agreement, building international renewable energy infrastructure and expanding international trade of Chinese renewable energy industry will be good way to solve the problem. And through the renewable energy bilateral or multilateral cooperation, the legalization of renewable energy in certain area can be realized.