Non-tariff measures: next steps for catalysing the low-carbon economy

Global trade in environmental goods is estimated to be around US$1 trillion annually, and growing quickly. As countries struggle to deliver energy systems that are secure, affordable and environmentally sensitive, eliminating tariff barriers to environmental goods proves to be an essential tool to achieving all three goals.

Like-minded nations have made great progress toward an agreement to eliminate tariffs on environmental goods and is expected to conclude negotiations at the end of 2016. In its latest World Energy Perspective report, the World Energy Council calls on countries to begin planning for a next phase of trade negotiations in order to carry forward the momentum from a plurilateral tariff agreement.

The World Energy Perspective on Non-tariff Measures is the second report in a series looking at how an open global trade and investment regime concerning energy and environmental goods and services can foster the transition to a low-carbon economy.

Building on the previous report on tariff barriers to environmental goods, this paper highlights twelve significant non-tariff measures (NTMs) directly affecting the energy industry and investments in this sector. The World Energy Council has identified that these barriers can greatly impact a country's trilemma performance – the triple challenge of achieving secure, affordable and environmentally sustainable energy systems.

Through this work, the Council seeks to inform policymakers as to what extent countries should address non-tariff measures to improve trade conditions, and eliminate unnecessary additional costs to trade, ultimately fostering national economic development.

Reducing and eliminating trade barriers is key to catalysing the low-carbon economy and enabling countries to develop sustainable energy systems. Thus, positively impacting on all three aspects of the energy trilemma, through reduced cost of technology and energy itself, enhanced energy security and transition to a low-carbon energy system.