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The politics of renewable energy trade: The US-China solar dispute

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  • Hughes, Llewelyn
  • Meckling, Jonas

Abstract

The Chinese and US governments played significant roles in the development of renewable energy industries, seeing them as key growth sectors and crucial to addressing climate change. While the US and China cooperated in renewable energy development, since 2011 the countries have engaged in a protracted and major trade dispute in the solar photovoltaics industry. We propose that the US government's decision to impose, and then expand, tariffs on a number of Chinese solar producers can be explained though a model of coalitional politics, drawing on Actor-Centered Institutionalism and the Advocacy Coalition Framework. We show that a coalition of domestic manufacturers and congressional interests formed a protectionist coalition that utilized US trade law to their advantage. In doing so they sidelined a free trade coalition representing the majority of US solar photovoltaic firms. The institutional design of US trade law also facilitated the successful application of trade remedies. Our analysis suggests that the domestic politics of renewable energy trade make trade conflicts a likely outcome, leaving limited scope for policy to carefully manage the trade-off between protecting parts of manufacturing through tariffs and lowering the cost of renewable energy technologies to mitigate climate change.

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  • Hughes, Llewelyn & Meckling, Jonas, 2017. "The politics of renewable energy trade: The US-China solar dispute," Energy Policy, Elsevier, vol. 105(C), pages 256-262.
    • Handle: RePEc:eee:enepol:v:105:y:2017:i:c:p:256-262
    DOI: 10.1016/j.enpol.2017.02.044
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    1. Patrice Bougette & Christophe Charlier, 2019. "Subsidies and Countervailing Measures in the EU Biofuel Industry: A Welfare Analysis," Post-Print halshs-02306022, HAL.
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    3. Zhang, Xufang & Haviarova, Eva & Zhou, Mo, 2020. "A welfare analysis of China's tariffs on U.S. hardwood products," Forest Policy and Economics, Elsevier, vol. 113(C).
    4. Sharma, A. & Surana, K. & George, M., 2022. "Do clean energy trade duties generate employment benefits?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 159(C).
    5. Patrice Bougette & Christophe Charlier, 2018. "Antidumping and Feed-In Tariffs as Good Buddies? Modeling the EU-China Solar Panel Dispute," The Energy Journal, , vol. 39(6), pages 171-188, November.
    6. Kuik, Onno & Branger, Frédéric & Quirion, Philippe, 2019. "Competitive advantage in the renewable energy industry: Evidence from a gravity model," Renewable Energy, Elsevier, vol. 131(C), pages 472-481.
    7. Weko, Silvia & Goldthau, Andreas, 2022. "Bridging the low-carbon technology gap? Assessing energy initiatives for the Global South," Energy Policy, Elsevier, vol. 169(C).
    8. Andres, Pia, 2024. "Industrial policy and global public goods provision: rethinking the environmental trade agreement," LSE Research Online Documents on Economics 117899, London School of Economics and Political Science, LSE Library.
    9. Apergi, Maria & Zimmermann, Eva & Weko, Silvia & Lilliestam, Johan, 2023. "Is renewable energy technology trade more or less conflictive than other trade?," Energy Policy, Elsevier, vol. 177(C).
    10. Garsous, Grégoire & Worack, Stephan, 2022. "Technological expertise as a driver of environmental technology diffusion through trade: Evidence from the wind turbine manufacturing industry," Energy Policy, Elsevier, vol. 162(C).
    11. Chen, Weidong & Wei, Pengbang, 2018. "Socially optimal deployment strategy and incentive policy for solar photovoltaic community microgrid: A case of China," Energy Policy, Elsevier, vol. 116(C), pages 86-94.
    12. Zhu, Xiangdong & He, Canfei & Gu, Zhutong, 2021. "Benefit from local or destination? The export expansion of Chinese photovoltaic industry under trade protection," Energy Economics, Elsevier, vol. 104(C).
    13. Cristian Pons-Seres de Brauwer, 2022. "The Politics of Market Change towards Sustainability: Revisiting Germany’s Policy Support Framework for Renewables," Energies, MDPI, vol. 15(11), pages 1-27, May.
    14. Andres, Pia, 2022. "Was the trade war justified? Solar PV innovation in Europe and the impact of the ‘China shock’," LSE Research Online Documents on Economics 116945, London School of Economics and Political Science, LSE Library.
    15. Zanjirchi, Seyed Mahmoud & Shojaei, Sara & Naser Sadrabadi, Alireza & Jalilian, Negar, 2020. "Promotion of solar energies usage in Iran: A scenario-based road map," Renewable Energy, Elsevier, vol. 150(C), pages 278-292.
    16. Morgan Bazilian & Benjamin Sovacool & Todd Moss, 2017. "Rethinking Energy Statecraft: United States Foreign Policy and the Changing Geopolitics of Energy," Global Policy, London School of Economics and Political Science, vol. 8(3), pages 417-420, September.
    17. Adriana Peluffo, 2020. "China US Trade War: Will it impact on Latin American Countries?," Documentos de Trabajo (working papers) 20-08, Instituto de Economía - IECON.
    18. Ogura, Yasuhiro, 2020. "Policy as a “porter” of RE component export or import? Evidence from PV/wind energy in OECD and BRICS," Energy Economics, Elsevier, vol. 86(C).
    19. Wei Liu & Youfa Sun & Serhat Yüksel & Hasan Dinçer, 2021. "Consensus-based multidimensional due diligence of fintech-enhanced green energy investment projects," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 7(1), pages 1-31, December.
    20. Nguyen, Ly & Kinnucan, Henry W., 2019. "The US solar panel anti-dumping duties versus uniform tariff," Energy Policy, Elsevier, vol. 127(C), pages 523-532.
    21. Debra Sandor & Sadie Fulton & Jill Engel-Cox & Corey Peck & Steve Peterson, 2018. "System Dynamics of Polysilicon for Solar Photovoltaics: A Framework for Investigating the Energy Security of Renewable Energy Supply Chains," Sustainability, MDPI, vol. 10(1), pages 1-27, January.
    22. Eicke, Laima & Weko, Silvia, 2022. "Does green growth foster green policies? Value chain upgrading and feedback mechanisms on renewable energy policies," Energy Policy, Elsevier, vol. 165(C).
    23. Agnieszka Hajdukiewicz & Bożena Pera, 2020. "International Trade Disputes over Renewable Energy—the Case of the Solar Photovoltaic Sector," Energies, MDPI, vol. 13(2), pages 1-23, January.
    24. Chen, Xiangyu & Tongurai, Jittima, 2023. "Informational linkage and price discovery between China's futures and spot markets: Evidence from the US–China trade dispute," Global Finance Journal, Elsevier, vol. 55(C).
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