China has agreed to do away with subsidies to wind power firms that use domestic parts, settling a green technology trade dispute with the United States over China's policy of making such imports expensive.
"The United States is pleased that China has shut down this subsidy programme. Subsidies requiring the use of local content are particularly harmful and are expressly prohibited under WTO rules," US trade representative Ron Kirk said in a statement.
The US had moved the World Trade Organisation over the issue at the instance of the United Steelworkers Union, which last year urged the Barack Obama administration to challenge China's clean energy measures that violated WTO rules.
"American manufacturers can produce wind turbine components here in the United States and sell them in China. That supports well-paying jobs here at home," Kirk added.
The Chinese government provides grants to wind turbine makers that agree to source key parts and components in China instead of importing them, USTR said.
Individual grants since 2008 ranged from $6.7 million to $22.5 million and could collectively total several hundred million dollars, it added.
The Obama administration seen green technologies such as wind power as a promising source of job creation at a time when the government is struggling with high unemployment and the ability of the US economy to generate enough new jobs.