Trade Considerations for Decarbonization Strategies
Legal Pathways to Deep Decarbonization in the United States, Michael B. Gerrard and John C. Dernbach, eds., ELI Press, 2018, Forthcoming
44 Pages Posted: 24 Aug 2018 Last revised: 15 Oct 2018
Date Written: 2018
As countries fulfill their commitments to the Paris Climate Agreement and engage in climate change mitigation policies and domestic decarbonization strategies, governments must ensure their policies comply with their trade obligations. This chapter provides a brief overview of key areas where international trade rules may impact U.S. policies geared towards decarbonization. It will focus primarily on the policies needed for decarbonization, as outlined in the Deep Decarbonization Pathways Project report, that are connected to international trade rules, with the goal of finding ways of using the international trade legal framework as another tool for encouraging, rather than inhibiting, decarbonization efforts at the national level. Section II sets out the policy tools promoting decarbonization most likely to implicate or conflict with trade rules. Section III provides a primer on the main trade rules that intersect with decarbonization tools such as border tariff adjustments, subsidies, labeling schemes, and local content requirements. Section IV examines specific cases where decarbonization has led to trade law conflicts as well as recommendations for decarbonization strategies that are trade compliant and avoid such conflicts in the future. Section V considers preferential trade agreements as an alternative way that trade policymakers and regulators may work together towards decarbonization.
Keywords: trade law, WTO, decarbonization, energy, regional trade, natural resources, climate change, Paris climate agreement environment, regulation, public policy, clean energy
JEL Classification: K22,K33
Suggested Citation: Suggested Citation