The US and China might be making nice this week, with several trade disputes being resolved at a meeting in Hangzhou - which included a promise by China to drop the ‘local content' requirement on wind farm tenders. Meanwhile a big wind project in Texas announced yesterday will use turbines supplied by a Chinese company, A-Power Energy.

But if US wind turbine manufacturers want another foreign renewables contingent to worry about, there's always the Europeans. A study by non-profit group the Investigative Reporting Workshop found that 84 per cent of the $1.05bn handed out by the US government since September 1 has gone to foreign companies - mostly European.

It's not an overwhelmingly surprising finding given that the US subsidiary of Spain's Iberdrola Renovables - the biggest wind farm operator in the world - was also the biggest recipient of the funds. And big European turbine manufacturers such as Vestas have been quite clear that they see the US as their big growth market. And incidentally, European countries such as Germany have also found their renewables subsidies creating foreign jobs too - such as solar-panel manufacturing in China.

As the FT reports, the handing out of green stimulus money to foreign manufacturers only highlights the weakness of the US renewables sector. The solar sector, where the US only has a 10 per cent market share is not much better. The US renewables industry has suffered from intermittent tax credits systems. As IRW writes:

The tax credit, however, has only been approved for short periods and every time Congress allows it to lapse the industry takes a nose dive. The stimulus package included a long-term extension of the production tax credit - through 2012, but at a tough time.

It's a tough time now because tax credits naturally require a company to be a big taxpayer to reap the benefits. Until recently, renewables companies lacking in taxable income teamed up with financial companies to access the benefits of tax credits. But the financial crisis meant a renewables crisis, too (it's all chronicled going back to the Carter Administration in the Atlantic, for those who are interested).

And while the US has General Electric, several European wind turbine manufacturers such as Vestas, Gamesa and Siemens have been able to grow into giants of industry. And Chinese companies are also ramping up development; and sometimes much cheaper - prices as low as $800,000 per installed megawatt of capacity, about half the going rate in the west.

IRW points out that much of the manufacturing - the most labour-intensive part of building up wind power - is also done overseas: 695 of the 982 wind turbines installed that received grant money in the September 22 round were manufactured outside the US. But the picture is a little more complicated than that. European wind companies such as Iberdrola point out that it is their US subsidiaries that are the grant recipients, and they employ people in the US. Denmark's Vestas says it hopes to be producing fully US-made turbines in a few years.

If the US wants to win the clean energy race it is so preoccupied with, some long-term industry support would seem in order. The stimulus money alone won't do it: many of the wind farms it has funded so far were already operating when they received grant money. And the conditions on that grant money were worryingly light. From IRW:

"There are no restrictions on the use of the funds," Dan Tangherlini, an assistant secretary for management at the Department of Treasury, said, during a Sept. 1 conference call to announce the grants.

Could the money be used to pay shareholders?

"You know, that's possible," Tangherlini said, when a reporter asked that question during the call.