WTO Rules Against US Green Energy Subsidies in China Dispute

• The WTO found the US at fault regarding green energy subsidies under the Inflation Reduction Act (IRA), initiated by former President Joe Biden's administration.
• The dispute panel stated that significant tax credits under the IRA were "inconsistent" with multiple WTO agreements and should be rescinded.
• China initiated the dispute in March 2024, alleging unfair competition due to US support for domestic energy transition companies and electric vehicles.
• The ruling affirmed China's assertions regarding Investment Tax Credits (ITCs) and Production Tax Credits (PTCs), recommending their withdrawal by October 1, 2026.
• China praised the ruling as "objective and impartial" and urged the US to rectify the violations, while the US can appeal despite the inoperative WTO Appellate Body.

Why It Matters: WTO ruled US green energy subsidies violate trade rules, urging withdrawal of tax credits by 2026.