The Rise of Trade Remedies in the Renewable Energy Sector and the Need for Bilateral Agreement Between the EU and China

Abstract

Recent years have witnessed escalating trade conflicts concerning various renewable energy supportive policy measures that are carried out domestically. In parallel to a few high-profile disputes initiated via the World Trade Organization (WTO) dispute settlement system, an aggressive resort to unilateral trade remedies against renewable energy products, particularly among major renewable energy producer countries, is also conspicuous. The pervasive use of trade remedies is bound to bring tensions to trade relations and impede the development of renewable energy, the latter of which can slow down efforts made to address climate change. This chapter attempts to elaborate on the issue of renewable energy trade remedies, specifically between the EU and China and proposes solutions that can reduce or even eliminate the use of remedial measures. It starts with the discussion of renewable energy industrial policies and delineation of relevant WTO rules. The following part touches upon the EU’s imposition of remedial measures against Chinese solar panels. The use of remedial measures against renewable energy products is far from an ideal solution for trade conflicts between the EU and China. Cooperation instead of confrontation is called upon with the presence of huge economic benefits and profound climate-related considerations underlying renewable energy sector. This chapter puts forward the idea of reaching a bilateral agreement between the EU and China that specifically deals with the use of trade remedies targeting renewable energy goods.