Fragmentation in Global Energy Governance: Explaining the Creation of IRENA

Abstract

In 2009, some member countries of the International Energy Agency (IEA) spearheaded the creation of a new international organization, the International Renewable Energy Agency (IRENA), despite the fact that the IEA had been working on renewables for decades. Why would those states create an overlapping organization, thus advancing the overall degree of fragmentation? Drawing on the work of Mansfield and Moravcsik, this article provides an explanation based on domestic preferences and institutional capture. Viewed through this lens, IRENA was part of an institutional hedging strategy instigated by domestic actors in Germany and allied states to counter the IEA’s alleged normative bias toward the fossil and nuclear energy industries with a wider set of alternative energy options. The findings of the article suggest that, depending on the domestic preferences of a set of states capable to innovate, the transaction costs associated with institutional reform may surmount those of institutional creation.

Keywords: global energy governance, renewable energy, IRENA, IEA, institutional capture, overlapping institutions