EXECUTIVE SUMMARY
The Environmental Investigation Agency (EIA) built upon existing reporting and conducted an unprecedented multi-year ground-truthing investigation that connects the dots between the illegal logging and human rights violations reported in the Ecuadorian and Peruvian Amazon, the insufficient due diligence by world leading wind blade manufacturers, and global energy provider giants like the recently incorporated GE Vernova.
At the nexus of Amazonian ecosystems, Indigenous People’s rights, wind turbines, and major policy incentives in both China and the U.S. lies a tree species known as balsa (Ochroma pyramidale ). This incredibly light and resistant wood, native from the Americas, has commonly been used as a core material for wind turbine blades.
Ecuador produces over 90% of the balsa in the world, with annual exports averaging 56,000 tons from 2013 to 2022. EIA investigators learned that until the late 2010s, the national production was mostly relying on the dense balsa plantations (over 15,000 hectares) established in the coastal lowland plain of Ecuador. In 2019-2020, the situation changed rapidly, as Chinese provinces rushed to meet their wind power capacity targets established as a consequence of the 2015-2020 5-year national development plan – which made expansion of wind energy capacity a priority.
The sudden demand increase from China led to the exhaustion of balsa wood plantations in Ecuador, in particular for “older” trees of 4-6 years, which are critical to achieve the average wood density required by blade manufacturers. Teams of loggers rushed to forests in the Ecuadorian Amazon to acquire more of these mature trees that were all of a sudden in high demand. Waves of illegal logging, incursions within protected areas and indigenous territories were widely reported. According to EIA findings, illegal loggers have ventured well-within the United Nations Educational, Scientific and Cultural Organization (UNESCO) Yasuni Biosphere Reserve, an area of 2.7 million hectares that comprises one of the most biodiverse forests on Earth and some of the last uncontacted Indigenous groups, the Taegari and Taromenane. EIA investigators were also told that as older balsa trees were becoming more difficult to find in Ecuador, illegal loggers ventured into the neighboring Peruvian forests, smuggled the balsa trees to Ecuador, and laundered them as “origin Ecuador.”
According to EIA’s investigation this skyrocketing demand has had a long-lasting effect. It appears that since the 2019-2020 balsa boom, the entire balsa production sector continues to depend upon the logging of natural forests, with a blending of plantation vs. natural forest balsa that allegedly varies between 10% and 70%, depending upon exporter. These mixing practices in Ecuador have global repercussions.
According to EIA’s findings, leading global blade manufacturers, including TPI Composites and LM Wind Power, have rarely questioned or controlled the origin of the balsa wood they have used. Investigators were told that as long as the balsa wood meets quality and density requirements, origin apparently matters very little. The faulty due diligence across the wind turbine supply chain has profound consequences. The EIA investigation shows that energy provider giants in the U.S., such as the publicly listed company GE Vernova (NYSE: GEV), and world leading wind turbine manufacturers in China, like Goldwind (金风科技) and Mingyang (明阳风电), have allegedly relied for years on balsa supply chains linked to illegal logging, violations of Indigenous People’s rights, smuggling, and corruption.
As the Inflation Reduction Act (IRA) – which incentivizes the installation of wind farms – is progressively implemented in the U.S. and as China again approaches the end of a 5-year national development plan (2021-2025), the immediate future looks grim for Ecuadorian and Peruvian forests and communities who call them home. However, the concentrated supply chain – one major production country with a handful of well-identified exporters, the growing awareness on the demand side about the real cost of the energy transition – both ecologically and from a human rights perspective, and the influential role of public policies in China and the U.S. offer clear opportunities for change.
In response to EIA’s request for comments, GE Vernova, TPI Composites, 3A Composites Core Materials, and Ecuabalpro denied any wrongdoing and expressed confidence in their supply chains. Their answers are available in their entirety at https://eia.org/report/ill-wind/.
Download original document: “ILL WIND: From Amazon Forest Crimes in Ecuador to Wind Turbines in the U.S. and China”