Greenhouse Gas Emission Impacts of Liberalizing Trade in Environmental Goods & Services

The paper investigates whether removing tariffs on environmental goods can significantly reduce GHG emissions. It concludes that the 'Friends of the EGS' list of 153 goods would only have a material impact through renewable energy technologies, but that tariff removal alone is insufficient to drive significant uptake without accompanying policies like feed-in tariffs. The author suggests that for trade liberalization to be effective, lists must be based on objective environmental needs rather than commercial interests and must be supported by capacity-building measures in developing countries.

• The 'Friends of the EGS' list of 153 environmental goods would only significantly impact GHG emissions through its inclusion of renewable energy plants; other categories such as air pollution control and waste water management have negligible or low potential.
• Tariff removal alone is unlikely to cause a significant increase in the uptake of renewables because the cost of generation typically requires financial support, such as feed-in tariffs, that far exceeds the cost savings from removing tariffs.
• A 'back-of-envelope' estimate suggests that tariff removal on the 153 goods could result in GHG savings between 45 and 325 MtCO2/year by 2030, which represents only 0.1% to 0.9% of projected reference case emissions from fossil fuel combustion worldwide.
• The effectiveness of trade liberalization is hindered by the Harmonized Commodity Description and Coding System (HS), as many environmental goods are 'dual-use' and share codes with non-green products, making targeted tariff reductions difficult.
• To maximize GHG reductions, the author proposes an alternative list based on mass-market technologies from the IEA's Energy Technology Perspectives 2008, focusing on seven key options including wind power, fuel switching from coal to gas, and building and transport fuel efficiency.
• Trade liberalization must be accompanied by 'flanking measures' to be effective, including addressing non-tariff barriers and improving the capacity of host states to absorb new technologies through energy policy and financial institutions.

APA

Wooders, P. (2009). Greenhouse Gas Emission Impacts of Liberalizing Trade in Environmental Goods & Services. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/bali_2_copenhagen_egs.pdf

Chicago

Wooders, Peter. Greenhouse Gas Emission Impacts of Liberalizing Trade in Environmental Goods & Services. International Institute for Sustainable Development, 2009. https://www.iisd.org/system/files/publications/bali_2_copenhagen_egs.pdf.

Wikipedia

{{cite report |last1=Wooders |first1=Peter |title=Greenhouse Gas Emission Impacts of Liberalizing Trade in Environmental Goods & Services |publisher=International Institute for Sustainable Development |date=October 2009 |url=https://www.iisd.org/system/files/publications/bali_2_copenhagen_egs.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{wooders2009greenhouse, author = {Wooders, Peter}, title = {{Greenhouse Gas Emission Impacts of Liberalizing Trade in Environmental Goods \& Services}}, institution = {International Institute for Sustainable Development}, year = {2009}, month = oct, url = {https://www.iisd.org/system/files/publications/bali_2_copenhagen_egs.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }