Conference article

Dynamics of the global renewable energy market are mostly described in terms of investment and added capacity. The role and characteristics of cross border trade flows with renewable energy system components; however; remains blurred. While national environmental regulation and innovative capacity is important for the promotion of renewable energies the effect of regulation and innovative efforts on export dynamics remains ambiguous as empirical studies on the pollution haven and the Porter hypothesis reach diverging conclusions and rarely focus on the renewable energy sector. This paper closes the gap by: First; focusing on solar energy technology components; structure and development of international trade since 1996 is analyzed. Second; determinants of OECD exports are identified in an econometric panel study estimating a gravity trade model. The results unveil a highly dynamic global market for solar energy technology components since 2002; with Europe as dominant market and increasingly strong exports from China. Additionally; the analysis supports the Porter hypothesis as countries with a strong framework supporting renewable energies have gained a comparative advantage in exporting solar technology goods. Analyzing the importer side shows that tariff reduction and FDI inflows have increased imports.

Renewable Energies; International Trade; Trade Barriers; Regulation