BIS Issues Report on Impact of U.S. Export Controls on Green Technology Items

On August 16, 2010, the Bureau of Industry and Security issued its latest Office of Technology Evaluation Report: Technology Assessment on Impact of U.S. Export Controls on Green Technology Items.

In the report, BIS found:

    ·    Most green technology-related items do not require a BIS export license. Licensed green technology-related exports represented 0.05% of total U.S. exports and a mere 0.004% of all energy sector exports in 2008. Of the $1,300.5 billion in total U.S. exports in 2008, BIS identified 5.8% ($75.0 billion) as green technology-related exports, and only 0.9% ($697.4 million) of these required an export license.

    ·    Some of the high-technology parts, materials, and equipment used to produce green technology items in the following areas would likely require an export license: wind power, solar power, alternative fuel vehicles, water purification, and energy efficiency.

    ·    Exporters have expressed concern with the lengthy processing times and difficulty in obtaining export licenses for carbon fiber and machine tools, the material and equipment needed for the production of wind turbines and lighter weight (i.e., energy efficient) commercial composite aircraft structures and engine components. Two companies with production facilities in the United States that are industry leaders for tape laying and tow/fiber placement machines used to manufacture windmill turbine blades are considering moving production of these machines overseas, especially because of the increased demand for wind turbines.

    ·    The export of Metal-Organic Chemical Vapor Deposition (MOCVD) equipment requires an export license in most cases, and is used to produce the solar cells used in solar panels and LED lighting products. One of the main MOCVD producers in Germany has sold this equipment to a customer that was denied an export license for the same equipment from a U.S. producer.

    ·    There are several green technology items in the areas of water purification (e.g., chemicals, pumps, valves) and energy efficiency (i.e., industrial gas turbine components and thermal imaging cameras) that are subject to an export license requirement, but the licensing and export statistics do not show that this license requirement is having an adverse affect on the competitiveness of these industries.

    ·    In most cases, BIS has determined that export licenses are not required for items in the following green technology areas: alternative fuel vehicles, commercial airlines noise reduction, biodegradable/bio-resins for composite materials, and green coating processes. However, research and emerging technologies in these fields could lead to the creation of new high-technology products that would be subject to export license requirements.

Accordingly, BIS states that it will:

    ·    Issue guidance to exporters clarifying which tape laying and tow/fiber placement machines would be controlled under ECCNs 1B001 or 1B101 for MT or NS reasons.

    ·    Monitor the volume of export license applications received for chemicals, chemical equipment, industrial gas turbines and components, and thermal imaging cameras and adjust export licensing policy and regulations where possible to ensure that export controls do not hinder trade in these items, especially when intended for civilian (i.e., non-military) green- related end-uses, consistent with national security interests.

    ·    Develop a green technology working group comprised of existing TAC members to identify emerging technologies that can support green technology initiatives that may be subject to an export license requirement in the future.

    ·    Work with the Department of Commerce's International Trade Administration on harmonization with export promotion efforts for the energy sector.

In addition, BIS will work with other U.S. Government (USG) agencies to develop a license exception, fast-track license review, and/or a one-time product/end-user review procedure for the export of items for civilian (i.e., non-military) green-related end-uses only.