Canada–Renewable Energy: Implications for WTO Law on Green and Not-So-Green Subsidies

Steve Charnovitz and Carolyn Fischer

RFF Working Paper Series from Resources for the Future

Abstract: In the first dispute on renewable energy to come to World Trade Organization (WTO) dispute settlement, the domestic content requirement of Ontario’s feed-in tariff was challenged as a discriminatory investment-related measure and as a prohibited import substitution subsidy. The panel and Appellate Body agreed that Canada was violating the GATT and the TRIMS Agreement. But the SCM Article 3 claim by Japan and the European Union remains unadjudicated, because neither tribunal made a finding that the price guaranteed for electricity from renewable sources constitutes a ‘benefit’ pursuant to the SCM Agreement. Although the Appellate Body provides useful guidance to future panels on how the existence of a benefit could be calculated, the most noteworthy aspect of the new jurisprudence is the Appellate Body’s reasoning that delineating the proper market for ‘benefit’ analysis entails respect for the policy choices made by a government. Thus, in this dispute, the proper market is electricity produced only from wind and solar energy.

Keywords: feed-in tariff; renewable energy; subsidies; international trade; WTO; green growth; local content requirement (search for similar items in EconPapers)
JEL-codes: K33 Q48 Q56 Q58 (search for similar items in EconPapers)
Date: 2014-10-30
New Economics Papers: this item is included in nep-ene, nep-env, nep-int and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Canada–Renewable Energy: Implications for WTO Law on Green and Not-So-Green Subsidies (2015)
Working Paper: Canada – Renewable Energy: Implications for WTO Law on Green and Not-so-Green Subsidies (2014)
Working Paper: Canada – Renewable Energy: Implications for WTO Law on Green and Not-so-Green Subsidies (2014)
Working Paper: Canada – renewable energy: implications for WTO law on green and not-so-green subsidies (2014)
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