New report: Catalysing the low-carbon economy

Technology and a reduction of barriers to environmental energy-related goods have been cited as requirements for achieving  post-2015 climate and development goals at the lowest possible economic cost.

 

The Asia Pacific Economic Partnership (APEC) acted first to create a trade programme designed to facilitate environmentally friendly projects. At its leaders’ meeting in 2012, APEC nations committed to reduce and cap their tariffs on 54 environmentally friendly products at 5%. This action by APEC members is a tangible international endorsement of the principle that trade liberalisation can contribute simultaneously to economic growth and to environmental sustainability.

At the beginning of 2014, 14 World Trade Organization (WTO) members came together in Davos and announced their commitment to explore opportunities in the WTO to build on the APEC’s ground-breaking commitment to reduce tariffs by the end of 2015. Together these countries alone account for 86% of global environmental goods trade.

The World Energy Council endorses these efforts to negotiate an Environmental Goods Agreement (EGA) under the WTO. Early this month it published a list of goods for inclusion under an Environmental Goods Agreement to support the negotiations. These recommended goods are of greatest importance to balancing what the organisation refers to as the ‘energy trilemma’, a 21st century policy framework grounded in three critical elements that involve energy that is secure, affordable, and environmentally sensitive.

Commenting on the motivation for the new report, Timothy Richards, Executive Chair of the Council's Rules of Trade Task Force, said:

 

“The elimination of tariffs on environmental goods matters.  It addresses all three aspects of the energy trilemma by promoting more energy supply, cutting energy costs, and reducing emissions.  Cutting tariffs will also enable the development of clean energy industries in the countries that participate.”

The forthcoming round of the EGA negotiations will take place this month (26–30 January) at the WTO in Geneva and will focus on products for cleaner and renewable energy and energy efficiency.