Linking Trade, Climate Change and Energy: Trade and Environment Series.

Wednesday, July 22, 2009

In order to embark on the transition to a sustainable energy future – a future in which greenhouse gas concentration would be stabilized at a level that prevents dangerous interference with the climate system – governments and the private sector, civil society and international organisations must understand and address the challenges posed by developments in the global energy sector. Trade policy strategies must also deal with these processes in a comprehensive manner. Failure to manage the transition will not only lead to negative environmental, social and economic impacts, but could also result in political conflicts and violence as a consequence of power struggles over access to dwindling
energy resources. The multilateral trading system will be directly and indirectly impacted by the transition to a sustainable energy future, and will in turn exert substantial influence on the necessary and far-reaching transition.

Linking Trade, Climate Change and Energy: Trade and Environment Series. Selected Issue Briefs.
ICTSD Project on Trade and Sustainable Energy

The changing energy landscape
Increasing energy consumption, driven particularly by the rapid growth of emerging economies such as China and India, as well as volatile and rising oil prices and growing concerns over energy security are forcing a re-alignment of the global energy sector. Patterns of investment and technology flows in this sector are shifting in response to the scarcity
of reserves, fostering the emergence of new actors and new strategies in the energy business.

The International Energy Agency projects that energy demand and prices will continue to soar, with the world set to use 60 percent more energy in 2030 than at present. Renewable energies such as solar, wind, geothermal and modern biomass are on the rise, with wind power being the fastest growing energy source in the world. However, incentives and investments in renewables continue to be insufficient to forge a fundamental overhaul of the energy sector.

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