International investment in green energy needs to be scaled up significantly in the coming years if it is to achieve its full potential to mitigate climate change. Green energy also has the potential to promote domestic growth and employment. In particular, the solar PV and wind energy sectors can contribute to creating value across the entire value chain.
Despite increased investment over the past decade, green energy projects remain seriously constrained by specific barriers and governments often face policy trade-offs when designing investment incentives and policies to promote renewable energy.
To assist governments, the OECD has launched a project which aims to take stock of policy measures that may distort international competition and hamper international investment in renewable energy.
The project focuses on two dominant green energy sectors, solar PV and wind power generation and manufacturing, in developed countries and emerging economies.
A draft interim report highlights an increase in trade and investment restrictions such as local content requirements, which can potentially raise input prices for industries that are increasingly globalised, and thus impede investment in downstream segments of the solar and wind energy value chains.
The final report, due by end of 2014, will further assess the possible impacts of policy measures such as local content requirements, and discuss policy implications, with the view of achieving a level playing field for international investment in green energy.
This project is jointly undertaken by the OECD Investment and Environment Policy Committees, with contributions from other OECD policy communities.
OECD roundtable consultation on achieving a level playing field for international investment in solar and wind energy - 6 December 2013
>> read summary report (pdf)