Industry & Analysis’ Spotlight Series

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Industry & Analysis’

Spotlight Series

June 18, 2013

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Ryan MulhollandRenewable Energy

MAS – Office of Energy and Environmental Industries

Liz CouchAutomotive Parts

MAS – Office of Transportation and Machinery

Kim CopperthiteChemicals and Green Chemistry

MAS – Office of Materials Industries

Speakers

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Industry & Analysis’Spotlight on

Renewable EnergyJune 18, 2013

Prepared by the Office of Energy and Environmental Industries

Renewable Energy Team

Renewable Energy

The renewable energy industry includes:WindSolarGeothermalHydropowerBiomassBiofuels

Clean Tech

Clean Energy

Renewable Energy

Clarification of Terms

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OpportunitiesBloomberg New Energy Finance predicts that over $7 trillion will be invested globally in clean energy between 2012 and 2030.

Solar and wind are expected to grow the mostAccording to BNEF, Solar PV and wind will comprise the largest share of new power capacity added to 2030, accounting for 30% and 27% respectively.

Most rapid growth to occur in developing worldChina, the Middle East, Africa and Latin America should all see impressive growth rates as energy demand increases to keep with economic growth.

Renewables are expected to expand globallyThe IEA projects 57% of new capacity to 2030 will be in the form of renewable technologies despite the presence of lower cost natural gas power plants.

U.S. exporters are particularly competitive in high-tech products and servicesU.S. research labs and universities continue to drive technology innovation, often giving U.S. companies an early lead in new technologies.

$36 bn $43bn

$68bn

$97bn

$130bn$135bn

$188bn

$230 bn

Global Private Sector Investment in Renewable Energy

Source: Bloomberg New Energy Finance

$269 bn

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OpportunitiesBloomberg New Energy Finance predicts that over $7 trillion will be invested globally in clean energy between 2012 and 2030.

Solar and wind are expected to grow the mostAccording to BNEF, Solar PV and wind will comprise the largest share of new power capacity added to 2030, accounting for 30% and 27% respectively.

Most rapid growth to occur in developing worldChina, the Middle East, Africa and Latin America should all see impressive growth rates as energy demand increases to keep with economic growth.

Renewables are expected to expand globallyThe IEA projects 57% of new capacity to 2030 will be in the form of renewable technologies despite the presence of lower cost natural gas power plants.

U.S. exporters are particularly competitive in high-tech products and servicesU.S. research labs and universities continue to drive technology innovation, often giving U.S. companies an early lead in new technologies.

20042005

20062007

20082009

20102011

20122030

Global Private Sector Investment in Renewable Energy

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Risks and IssuesKey Global Trends:• Demand has declined in traditional markets, as feed-in

tariffs and other incentives in Europe have been reduced• China’s interest in manufacturing renewable energy

technologies has caused vast over supply in solar products• Over 100 countries now have renewable energy incentives,

but many are tying incentives to domestic production requirements (LCRs)

• Price declines in wind and solar are significant

Key Domestic Trends:• Exhaustion of Section 1603 Treasury Cash Grant Program• Manufacturing Tax Credit (48c) no longer available• No national level energy policy in foreseeable future• Production Tax Credit set to expire (could severely limit

wind energy growth)• Natural gas limiting investment in renewables, particularly

wind energy

Manufacturers are being squeezed by price declines,

causing many firms to turn to governments for support.

Many countries now act inconsistently with their trade

obligations.

Trade enforcement has therefore become an important facet of

the industry’s near-term prospects

Finding new market opportunities for U.S. companies abroad is critical to maintaining

RE industry domestically.

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Examples of ITA and Interagency Activities

A/S Nicole Lamb-Hale meets with Chile’s Minister of Energy, Jorge Bunster, during a

recent RE&EE trade policy mission (April 2013)

ITA and DOE employees on an observation platform above Matsushima Bay in Japan during a RE&EE trade policy mission (December 2012)

The MAS Renewable Energy Team’s activities support the ongoing implementation of the Renewable Energy and Energy Efficiency Export Initiative (RE4I), a principal component of the President’s NEI.

ITA’s Commitments in the RE4I include:1. Creation of a RE&EE Advisory Committee

• Initial committee made 22 recommendations; since been re-chartered (four subcommittees)

2. The development of targeted trade policy missions and industry roundtables• Mexico (Sept 2011); Japan (December 2012); Chile (April 2013)

3. Host an interagency web portal• www.export.gov/reee

4. Produce a comprehensive market prioritization study5. Expand the Green Embassies Program6. Lead additional RE&EE trade missions

• Saudi Arabia (May 2012); Southeast Asia (Sept 2012)

7. Facilitate interagency coordination at key industry trade shows 8

Renewable Energy Team’s Products

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Exporters Web Portal

News, information, market research from across the U.S. Government specific

to exporters

Monthly Exporters’ E-NewslettersProvides links to

registration for upcoming events, as well as reports and market research on

export opportunities abroad

MAS Market Intelligence Briefs

Provides in-depth market research on key export

markets, including opportunities, challenges,

and market structure information.

Country or Market Case Studies

Short overviews of the renewable energy market in particular countries or sub-sectors as part of the 2014 Renewable Energy

Top Markets Reportwww.export.gov/reee/topmarkets

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Renewable Energy Team Staff

www.export.gov/reee

Adam O’MalleyDirector, Office of Energy and Environmental IndustriesPhone: 202-482-4850Email: [email protected]

Catherine VialTeam Lead, Environmental and Renewable Energy Industries TeamPhone: 202-482-2823Email: [email protected]

Cora DicksonBiofuels, Biomass, Waste-to-Energy, Fuel Cells, Hydropower, Geothermal, RE&EE WebsitePhone: 202-482-6083Email: [email protected]

Ryan MulhollandWind and Solar, TPCC Working Group on RE&EE, RE&EE Advisory CommitteePhone: 202-482-4693Email: [email protected]

Nyamusi IgambiDeputy Director of CS Energy TeamPhone: 713-209-3112 Email: [email protected]

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Industry and Analysis’Spotlight on

Automotive PartsJune 18, 2013 (revised 2/21/14)

Prepared by the Office of Transportation and Machinery’s Automotive Team

Automotive Parts

The automotive parts industry includes:

Original equipment parts Aftermarket parts

Repair partso OE or New replacement partso Remanufactured parts

Specialty equipment Accessories

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NEI Priority Markets: (U.S. Auto Parts Export Figures based on Year-End 2013)

*Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and UAESource: U.S. Census Bureau

1. Canada ($31.6 B)2. Mexico ($26.6 B)3. European Union ($5.2 B)4. China ($2.3 B)5. GCC* ($961 M)6. Russia ($493 M)

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Opportunities• In 2013, U.S. auto parts exports were $77.3 billion, an 80%

increase in NEI growth (from full-year 2009-2013). From 2012 - 2013, exports of U.S. auto parts to the world grew by 3.1%.

• Growth economies (China, Russia, Middle East) have an increasing number of consumers able to afford vehicles and the aftermarket parts to repair and customize them.

• Potential for increased U.S. auto aftermarket exports resulting from global automakers’ increased exports of U.S.-made vehicles.

• Most SME auto parts companies do not currently export or export to only our NAFTA partners, which creates potential for increased exports.

• An increased interest in auto electronics, connectivity, fuel-efficiency, lower emissions, creates opportunities for U.S. companies of advanced technologies.

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Risks and Issues• Counterfeiting and protecting IP remain major concerns.

• Potential for foreign governments with domestic auto industries to develop policies that give advantage to domestic firms (advanced technology support programs; incentives and financing for domestic producers; and, protectionist measures to limit imports; bans on remanufactured parts).

• Potential for foreign governments to develop standards- or nationalistic-related regulations that disadvantage U.S. firms.

• Currency exchange rates are a factor in OE & aftermarket parts sourcing decisions.

• Ever-increasing competition from international auto suppliers and from non-automotive connectivity/infotainment companies.

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Examples of ITA and Interagency Activities

• Support SEMA’s MDCP

– SEMA Business Development Missions to China , Russia and the Middle East

– SEMA’s International Vehicle Measuring Program (helping SEMA members manufacture and export parts for vehicles not made or sold in the United States)

– Provide education to regulators in China and GCC re: U.S. regulatory process for specialty parts & customized vehicles

• Provide auto-related input for Trans-Pacific Partnership and U.S.-EU FTA negotiations.

• Address and monitor China’s auto policies, including USG’s WTO complaint regarding China’s auto parts subsidies.

• Promote/participate in trade promotion events, such as: Automechanika Middle East (June), Automechanika Mexico (July), and IZB International Supplier Fair (September).

• Prepare and distribute “Automotive Resource Guide.”

SEMA members take measurements of Toyota HiLux in order to make specialty products for export (July 2012)

Industry representative comparing U.S. and EU regulatory processes and compliance (June 2013)

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Automotive Team Products• Growth Trends of Vehicle Exports Report

• Automotive Resource Guide

• Quarterly automotive parts trade statistics

• Compilation of Foreign Motor Vehicle Import Requirements

• Website: http://trade.gov/mas/manufacturing/OAAI/index.asp

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18www.trade.gov/mas/manufacturing/OAAI/

Automotive Team StaffThomas Sobotta; Automotive Team Leader [email protected]; 202-482-4478

Elena Mikalis; Europe, ASEAN, standards, innovation [email protected]; 202-482-1417

Liz Couch; Middle East, China, MDCP Award for SEMA, Liaison with CS-Auto [email protected]; 202-482-2120

Andy Parris; Middle East, Africa, South America, Remanufacturing; Standards [email protected]; 202-482-1420

Todd Peterson; China, Japan, APEC Auto Dialogue, MDCP Award for CALSTART [email protected]; 202-482-3865

Jeff Williams; NAFTA, Korea-US FTA, Congressional Liaison, Import Requirements report [email protected]; 202-482-0670

Eduard Roytberg; Global Automotive Team Leader [email protected]; 909-390-8482

Commercial Service’s Automotive Team:

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Industry & Analysis’Spotlight on

the Chemicals IndustryJune 18, 2013

Prepared by the Office of Materials Industries

Chemicals Team

Chemicals Industry

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The U.S. chemicals industry is composed of a variety of robust subsectors, each of which has significant exports/imports:

• Inorganic Chemicals (HTS Chapter 28)• Organic Chemicals (HTS Chapter 29)• Fertilizers (HTS Chapter 31)• Tanning/Dyeing Extracts; Dyes, Pigments, Paints and Varnishes, etc. (HTS Chapter 32)• Cosmetics, Perfumes, Toilet Preparations (HTS Chapter 33) • Soap, Washing preparations, Lubricating preparations, artificial waxes and Prepared waxes, Polishing or

Scouring preparations, Candles, Modeling pastes, "Dental Waxes" and Dental preparations with a basis of plaster (HTS Chapter 34)

• Albuminoidal Substances; Modified Starches; Glues; Enzymes (HTS Chapter 35)• Explosives; Pyrotechnic products; Matches; etc. (HTS Chapter 36) • Photographic or Cinematographic goods (HTS Chapter 37)• Miscellaneous Chemical Products [Pesticides, Herbicides, Fungicides, etc.] (HTS Chapter 38)• Plastic Resins and Products (HTS Chapter 39)

In addition, we have a new focus on Green Chemistry - - an aspect of the industry that crosses all subsectors.

NEI Priority Markets

Key Points:• For all markets, tariff reduction/elimination, product-specific rules

of origin, and dialogue/advocacy on regulatory barriers are crucial to market access/expansion and reduction of cost-to-market for the U.S. chemicals industry. Multilateral and bilateral efforts are key.

• TPP: tariff elimination and product-specific rules of origin.• TTIP: tariff reduction/elimination and a path forward to greater

compatibility/cooperation in regulatory approaches.• ASEAN and the EU: Green Chemistry efforts focus on

creating/increasing market readiness/acceptance of new chemical processes/products.

• Asia: engagement on specific regulatory barriers (e.g., chemical registration)

• Even imports have a role to play - - Miscellaneous Tariff Bills

In 2012, global chemical exports were $1.6 trillion, with the U.S. exporting $181.5 billion in goods. However, Chemicals is not a conventional NEI Sector as we are looking to grow exports by addressing tariffs and non-tariff measures through multilateral or bilateral efforts and by implementing new initiatives to create market readiness/acceptance of U.S. Green Chemistry (GC) products and processes.

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Opportunities

Leveraging USG Commitment to Advanced ManufacturingProviding support for market development/trade promotion and trade barrier work on advanced/emerging chemicals technologies.

Capitalizing on Major Market Participation in TPPWorking toward better harmonization of regulations, and addressing tariff, customs, and rule of origin issues.

A Window for International Regulatory CooperationExecutive Order 13609 (May, 2012) provides a vehicle for increased cooperation/participation on foreign regulations affecting U.S. industry.

Advancing U.S. Industry Opportunity through TTIPUse US-EU negotiations to reduce/eliminate tariffs on chemicals trade, reduce NTBs, and increase regulatory cooperation/convergence.

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• American Chemistry Society (ACS) Green Chemistry Institute (GCI), a NGO partner bringing technical expertise in the area

• USAID, has provided funding in support of participation by ASEAN officials and chemicals management experts

• United Nations Institute for Training and Research (UNITAR), a multiplier for outreach and participation by government officials, industry, and other stakeholders

• U.S. Environmental Protection Agency, bringing the US government perspective and expertise

• U.S. industry, bringing practical business experience as well as new products/approaches to the subject

• And of course our colleagues in Global Markets who helped to bring our first ever U.S.-sponsored GC workshop to fruition in Kuala Lumpur, Malaysia in May 2013

Examples of ITA and Interagency ActivitiesThe I&A Chemicals Team engages industry, government, and NGOS to support the development of advanced manufacturing processes and other innovations in chemicals management. Through our Green Chemistry initiative, we have been able to partner or work with:

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Chemicals Industry Team StaffGary StanleyActing Director, Office of Materials IndustriesPhone: 202-482-0376Email: [email protected]

Kim CopperthiteExplosives, Photographic/Cinematographic Products, Plastic Resins and ProductsPhone: 202-482-5124Email: [email protected]

Raimundo PratInorganic Chemicals, Pigments, Paints/Coatings, Cosmetics/Toiletries, Cleaning PreparationsPhone: 202-482-0810Email: [email protected]

John MeakemOrganic Chemicals, Rare EarthsPhone: 202-482-4711Email: [email protected]

Blandine TrouilleFertilizers, and Ag Chemicals (Pesticides, Herbicides, etc.)Phone: 202-482-0129Email: [email protected]