Explaining Energy Disputes At The World Trade Organization

The WTO and the broader international trade regime have seen an explosion of challenges to government support for renewable energy in the last seven years, while no country has brought a formal dispute challenging fossil fuel subsidies in the GATT/WTO's history. This pattern is puzzling because global fossil fuel subsidies dwarf global renewable energy subsidies. Moreover, it suggests that WTO rules may slow the transition to clean energy. Renewable energy technology must compete with highly subsidized fossil fuels, while trade disputes effectively restrict subsidization only for the former. Existing explanations for the absence of trade challenges to fossil fuels support policies have focused primarily on the lack of a mandate within the WTO. Major fossil fuel exporters have not historically been GATT/WTO members; WTO rules allegedly do not apply to energy or are inadequate to deal with the specifics of energy trade; or even if they do, nations have developed separate institutions, such as the IEA or the Energy Charter Treaty, to govern energy. This article argues that, although these explanations have some explanatory power, they cannot fully or satisfactorily account for the pattern of WTO energy disputes in light of the recent focus on some forms of energy in the WTO but not others. Instead, I hypothesize that the economic diversification of energy-producing countries plays a major role in driving challenges to renewable energy support policies, but not fossil fuel support policies. It does so in two ways. First, states challenging energy support policies expect to have greater success in changing the respondent's behavior when the respondent has diversified exports. Renewable energy technologies tend to be produced in countries with diversified economies, while fossil fuel reserves are located overwhelmingly in countries with little diversification in their exports. Second, under what I term the loss aversion hypothesis, states may be more likely to challenge new trade restrictions, rather than similar but long-standing trade restrictions. The loss-aversion hypothesis suggests that trade challenges will arise more in sectors of the economy in which innovation leads to competition, as opposed to in mature sectors of the economy. Economic diversification, in turn, is a good predictor of innovation. As applied to energy, economic diversification contributes to innovation and competition in the renewables sector - and hence triggers demand for new trade restrictions - but not the fossil fuel sector, even though trade restrictions have a long history in that sector as well.

Contents: Energy and Sustainability, Energy, Population Growth and Energy, Turning on the Heat, Between Wish and Reality, Not Yet Fossil Fuel, The Marrakesh Declaration, What is the WTO?, The WTO is Born, New Agenda of the WTO, High World Trade Growth Vs. Output, Overview of WTO s First Year, Overview of WTO s First Two Years, WTO Has Delivered , The Trade Related Intellectual Property Rights (TRIPS) Agreement and the Developing Countries, Defining the Singapore Message of WTO, WTO Negotiations on Basic Telecommunications, Developing Countries and the Uruguay Round, The WTO Dispute Settlement Mechanism, The WTO and the Developing Countries, World s Trade The Next Challenge, International Trade with the Consumer s Money, Developing Countries After the Uruguay Round, The Uruguay Round, Africa to Gain More, Winners and Losers, Few Signs of Hope in Africa, Trading Towards Peace, The Uruguay Round and Agricultural Reform, WTO Agricultural Negotiations, Give Developing Countries A More Favourable Deal, Beyond the Uruguay Round, Trade and Labour Standards, The Uruguay Round Agreement on Agriculture, Opening Markets for Agriculture, The Future of Agricultural Trade.

The expansion of cross-border power transmission infrastructures and the regional integration of electricity markets are accelerating on several continents. The internationalization of trade in electric energy is embedded in an even greater transformation: the transition from fossil fuels to renewable energies and the race to net zero emissions. Against this backdrop, this book provides a comprehensive examination of the regulatory framework that governs the established and newly emerging electricity trading relations. Taking the technical and economic foundations as a starting point and thoroughly examining current developments on four continents, the book provides a global perspective on the state of the art in electricity market integration. in doing so, it focuses on the most relevant issues including transit of electricity, quantitative restrictions, market foreclosure and anti-competitive practices employed by the actors on electricity markets. In turn, the book carefully analyzes the regulatory framework provided by the WTO Agreements, the Energy Charter Treaty and other relevant preferential trade agreements. In its closing section, it moves beyond the applicable legal architecture to make concrete proposals on the future design of global trade rules specifically tailored to the electricity sector, which could provide a more reliable and transparent framework for the multilateral regulation of electricity trade.

Despite the myriad tensions existing at the nexus of the international trade and climate change regimes, perhaps more striking are the similarities that exist between the two. Both are recognised as mechanisms designed for pursuing a global good - whether that be increasing wealth or combatting anthropogenic climate change - seemingly providing fertile ground for the conclusion of international agreements, yet both are plagued by political inertia on the international level, destined to do no more than produce rhetoric lauding their final goal. Set against the underwhelming outcome of the Rio 20 conference and the continuation of the Doha Round of negotiations, this article examines one particular example of such inertia encountered at this crucial crossroads - specifically, the framework regulating subsidies for renewable energy in the World Trade Organization (WTO). Whilst the inadequacy of the WTO rules regulating renewable energy subsidies has been evaluated extensively elsewhere, this article instead focuses on a legal analysis that aims to inform the design of subsidies that would not fall foul of the WTO rules as they currently stand. This approach enables implementing states to take all necessary steps to ensure that their subsidies are not vulnerable to legal challenge within the WTO. Taking feed-in tariffs (FITs) as an illustrative example of renewable energy subsidies, the article analyses the pertinent rules of the WTO Agreements, and relevant Dispute Settlement Understanding (DSU) jurisprudence, in order to draw four general principles that should be followed in the design and formulation of renewable energy subsidies; namely, the effective positioning of the subsidy within a larger climate change policy, strict adherence to the principle of non-discrimination, the maintenance of policy links to international standards and agreements, and the institution of transparent and open design, implementation and enforcement processes. Placed against the impasse of the current Doha Round negotiations, the creation of renewable energy subsidies that are impervious to WTO regulation offers a realistic and achievable method of promoting climate change mitigation in international trade.

Starting from the premise that a multilateral legal framework is the surest way to achieve predictability and transparency under conditions of increasing reliance on internationally traded energy, the essays gathered in this book treat the many complex interlocking issues raised by examining that desideratum in the light of current reality. Concentrating on the application of WTO agreements to energy trade – as well as energy-related issues addressed in the current WTO negotiations – the authors offer in-depth discussion and analysis of such issues as the following: the effectiveness of existing WTO agreements in addressing issues pertinent to energy trade how restrictive practices of energy endowed countries can be tackled under existing international trade rules; existing frameworks for investment in highly capital-intensive energy infrastructure projects;and conditions for access to pipelines and transmission grids; regulation of energy services; bioenergy development and trade; energy issues addressed in the WTO accession negotiations of energy endowed countries; international instruments of resolution of energy-related disputes.

Energy intersects with the environment at all stages of its life cycle by affecting nature and public health and is subject to government measures concerning low-carbon growth, energy efficiency and conservation, renewable energy and ecologically safe supply of nuclear and other energy resources. This timely book provides a comprehensive analysis of the role of international economic law in regulating such an energy-environment nexus under the regimes of the WTO, the Energy Charter Treaty, regional trade agreements and investment treaties. The author discusses the international environmental and economic law foundations of this nexus and extensively examines relevant rules, jurisprudence and practices regarding trade restrictions, subsidies, technical standards, investment protection and technology policies. This book highlights the existing gaps and 'greening' solutions within the framework of international economic law. Where relevant, it draws comparisons between trade law and investment law to show their similarities, differences and (potential) conflicts at the energy-environment interface.

In A Multifaceted Approach to Trade Liberalisation and Investment Protection in the Energy Sector, Elena Cima and Makane Moïse Mbengue assess different approaches to bridge the gap between economic and non-economic considerations in the regulation of international energy trade and investment.

This comprehensive volume provides the first book-length account on the politics of fossil fuel subsidies. This title is also available as Open Access.

Fossil fuel subsidies strain public budgets, and contribute to climate change and local air pollution. Despite widespread agreement among experts about the benefits of reforming fossil fuel subsidies, repeated international commitments to eliminate them, and valiant efforts by some countries to reform them, they continue to persist. This book helps explain this conundrum, by exploring the politics of fossil fuel subsidies and their reform. Bringing together scholars and practitioners, the book offers new case studies both from countries that have undertaken subsidy reform, and those that have yet to do so. It explores the roles of various intergovernmental and non-governmental institutions in promoting fossil fuel subsidy reform at the international level, as well as conceptual aspects of fossil fuel subsidies. This is essential reading for researchers and practitioners, and students of political science, international relations, law, public policy, and environmental studies. This title is also available as Open Access.

In recent months the World Trade Organization (WTO) has seen increasing conflict over the rules for government support of the energy sector. Government subsidies for particular forms of energy have long influenced producers' investment choices and consumers' consumption patterns in ways that affect both international trade and the environment. Trade and environmental lawyers have thus closely watched the WTO's efforts to develop rules on government support for the energy sector. This essay outlines recent activity in the WTO on subsidies for both traditional fossil fuels and the renewable energy sector. It also discusses the difficulties posed by the increased application of WTO subsidies rules to renewable energy subsidies at a time in which fossil fuel subsidies programs continue to elude significant WTO scrutiny. This discrepancy - caused in part by WTO rules on subsidies and in part by energy politics in a number of countries that have shifted support for renewable energy subsidies to local governments less skilled in drafting WTO-compliant programs - threatens to undermine the WTO's ability to develop an environmentally-friendly jurisprudence on energy trade issues.