Enabling the Energy Transition and Scale-up of Clean Energy Technologies: Options for the Global Trade System

With the challenges of access to energy, energy security, and the imperative of climate change becoming more pronounced in recent years, interest in clean energy has surged. Mitigation efforts to limit global warming to no more than 2 degrees Celsius or 1.5 degrees Celsius as compared to pre-industrial levels will primarily hinge on a rapid and massive scale-up of clean energy. The December 2015 Paris Agreement on climate change is fundamentally about fostering an urgent and massive transformation to a low carbon or carbon-neutral energy base for the world economy. The urgent need to shift to a cleaner energy mix has thus made reform of the supply and use of energy a key policy priority for the global community. The world has witnessed a spectacular growth of clean energy technologies (CETs) in the past two decades, most of it in response to purposeful international, national, and subnational policies. The result is today’s global and dynamic clean energy industry, encompassing manufacturing, services, and knowledge, mostly organised in international value chains, and highly dependent on trade and investment. All of this activity, however, has highlighted the shortcomings and obstacles of uncoordinated policies and inconsistent rules. This paper seeks to examine the ways in which current trade policies and frameworks enable or hold back the pressing need for further development of clean energy.