Making the International Trading System Work for Climate Change: Assessing the Options

Kasturi Das, Harro van Asselt, Susanne Dröge, Michael A. Mehling

49(6) Environmental Law Reporter (2019): 10553-10580

The adoption of the Paris Agreement in December 2015, its rapid entry into force in November 2016 following ratification by a critical mass of countries, and subsequent adoption of a detailed rulebook for its implementation in December 2018 in Katowice – ushered in a new era of international cooperation on climate change. If the 2°C goal is to be achieved, massive improvements in energy efficiency, a substantial scale-up in renewable energy production, and enhanced access to clean energy technologies will be required. This calls for unprecedented efforts across all areas of socioeconomic activity, and thus also depends on support from other international regimes. The issues of policy and regime coherence assume particular importance vis-à-vis the international trading system, given that trade has an important role to play towards achievement of the Paris goals – both directly and indirectly. The significant surge in WTO disputes pertaining to climate change and clean energy over the past several years is indicative of the tensions that are brewing at the interface between national climate policies and measures, on the one hand, and international legal regimes pertaining to trade, on the other. With the increasing importance of national measures following the adoption of the Paris Agreement, synergies and conflicts can be expected to change over time.

Keywords: WTO Disputes; Trade and Climate Coherence; Clean Energy Measures; Paris Agreement; Environmental Exceptions; Climate-related Subsidies