Green technologies need open markets to deliver on climate goals

In recent years, the US and Europe have adopted various trade and industrial policies targeting clean technologies. The EU has imposed countervailing duties of 7.8 to 35.3 percent on Chinese electric vehicles, on top of its standard 10 percent import tariff. The US has sought to influence companies' market choices and investment decisions by raising Section 301 tariffs on Chinese solar cells. While countries may have different policy rationales and objectives for adopting these measures, businesses face the same practical questions: Can their equipment enter the market? How much will procurement costs increase? Will existing supply chains and investment plans need to be adjusted?

Global emissions reduction requires wider deployment of clean technologies, but trade restrictions may make it difficult for some countries to access these technologies at affordable prices.

According to the International Energy Agency, China accounts for around 85 percent of solar and 80 percent of lithium-ion battery supply chain production capacity. The International Renewable Energy Agency shows that in 2025, the global, weighted-average levelized cost of electricity for solar PV was at $44 per megawatt hour (MWh), compared with $36 in China. For onshore wind projects, the corresponding figures were $33 and $27, respectively. The large-scale development and technological advances of China's solar PV industry have been among the major factors driving down global solar module prices. Equipment exports and international project cooperation have further expanded the reach of clean technologies, enabling more countries to build clean energy facilities at lower costs.

Electrification is also a key priority on the COP31 action agenda. The Turkish presidency's "35-by-35" initiative aims to increase electricity's share of global final energy demand to 35 percent by 2035. Achieving this goal will depend on clean electricity, power grids, energy storage and end-use equipment such as electric vehicles. China's development model as an electricity-powered economy, underpinned by its manufacturing capabilities, resilient power grid and vast market, offers a useful reference for global electrification.

The impact of trade policies also extends to project financing. Clean energy projects require substantial upfront investment, and equipment prices, delivery schedules and technical assessments all affect project budgets. Sudden changes in trade policies may force developers to switch suppliers, modify project designs or recertify equipment, increasing construction costs and creating greater uncertainty over project timelines.

The report Financing Clean Energy in Africa points out that despite the limited technology risk, the cost of capital for utility-scale clean energy generation projects in Africa is at least two to three times higher than in advanced economies and China. For African countries facing less favorable financing conditions, additional equipment costs, certification procedures and delivery risks could further undermine the financial viability of projects.

COP31 can provide a forum for discussing greater coordination between trade and climate policies. The United Nations Framework Convention on Climate Change, the World Trade Organization and other institutions should strengthen communication within their respective mandates, assess the impact of trade measures on climate action and clean technology deployment, reduce unnecessary trade barriers and improve conditions for the cross-border flow of clean technologies.

This is not about creating an entirely new set of rules. It's about helping policymakers better understand the spillover costs of industrial policy instruments. China's contribution can lie in providing technologies ready for deployment, replicable engineering projects and industrial cost curves.

Clean technologies can deliver genuine emissions reductions only when they are deployed in real-world projects and replace fossil fuels. Countries can develop green industries according to their own circumstances and take steps to safeguard supply chain security. However, global emissions reduction should not come at the cost of making everyone pay more because of trade disputes.

If COP31 can promote greater coordination between trade and climate policies and deliver practical arrangements on standards, certification procedures, financing support and technology transfer, thereby enabling clean technologies to reach more economies at reasonable costs, this would be an important outcome demonstrating the conference's commitment to turning pledges into action.