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There are four basic explanations for the under-theorization of energy Van de Graaf et al. First, many of the acknowledged energy experts are not particularly worried about theory. Rather, their concern lies with the short-run prospects for the market and with the question of how governments, corporations and other actors should respond Strange, Second, there are high barriers to entry to a field such as energy that requires a dose of technical understanding.

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Third, the multifaceted nature of energy as a policy area—straddling political science, economics and a host of other social sciences—makes it defy unidisciplinary analysis. After two decades of relative neglect, political scientists and international relations scholars have rediscovered energy as a worthy research topic Hughes and Lipscy, One reason for the renewed interest is the set of dramatic transitions that are currently underway in the global energy market. Here we discuss three central trends and transformations: climate change, geopolitical change, and increasing volatility in oil and gas markets.


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Arguably the most important transition is linked to the issue of global climate change and the need to decarbonize the global economy. States and markets have been slow to change, and world carbon emissions continue to rise. Still, to the extent that states take meaningful action to reduce GHG emissions, this is very likely to create incentives for a significant change in fuel choices and energy production patterns.

Incentives will shift away from consumption based on heavily emitting sources, such as coal and petroleum, towards low-emitting sources, such as wind, solar, geothermal and hydroelectric power. New governance structures and networks will be necessary to create the incentives for such a shift and to manage the consequences of it. A second major transition comes from geopolitical change. The two most significant changes are the collapse of the Soviet Union in the early s and the more recent rise of developing countries as energy importers. In the s, all of the major oil importing countries were members of the OECD; today, rapidly developing countries have changed the landscape.

For instance, in China was importing roughly , barrels of crude oil per day; in , it was importing 6. Consequently, the IEA has been urged to expand its membership to include China and India, but there are significant obstacles to such an expansion Colgan, ; Van de Graaf, Source : BP A third major transition is the increasing volatility on oil and gas markets, even in the absence of changes linked to climate change. Oil prices have swung markedly over the past few years.

The period — witnessed a cycle of high and volatile energy prices, after a long cycle of low prices in the period — see Fig. The revolution in shale gas and tight oil production in North America has largely stymied this debate. There are opposing views of the current situation. Tillerson and Klare both raise points with some validity, but regardless, it is already clear that the cheapest oil reserves are increasingly being produced from autocratic and sometimes politically unstable regions of the world.

Since oil is traded on a globally integrated market, developments anywhere could provoke ripple effects throughout the world market. In that regard it is notable that the nature of threats to energy security has changed over time. In the s, Arab nationalism and tight oil market conditions combined to make oil embargos from Organization of the Petroleum-Exporting Countries OPEC the dominant energy supply concern for energy-importing countries.

In , the nature of the threats has changed considerably. Source : U. These trends and transformations highlight—and in some cases exacerbate—a host of externalities associated with our global energy system. These externalities include the possibility of national and international energy shortages, nuclear proliferation and global climate change. Market price signals alone are often insufficient to provide satisfactory outcomes, creating a rationale for some form of governance to deal with those externalities Meyer, ; Van de Graaf, b.

The concept of governance became widely used in development policy circles in the s and, from there, also spread to other social science disciplines, including political science, law, public administration, economics, sociology, geography and history Rhodes, The emergence and rapid spread of the term is linked to processes of neo-liberalism and globalization, which denotes the global shift from the s onwards to financial deregulation, trade liberalization and the consolidation of global production networks Scholte, These shifts are said to have eroded the capacity of traditional modes of state-based regulation to steer society, both domestically and internationally Strange, Where governance was once assumed to be synonymous with the activities of government, today it is understood to also encompass the activities of local and international non-governmental organizations NGOs and activist groups, and the decisions crafted in corporate boardrooms and at global conferences.

Against this background, a number of scholars have set out to examine the scope and rationale of GEG.

Yet, the scope of GEG is not well defined. The potential scope of GEG is any social, political or economic issue that 1 crosses international borders and 2 is tightly connected to the production, distribution or consumption of energy. Understanding the gap between the potential and actual scope of GEG is crucial for understanding how the existing set of energy institutions might evolve in the future. For policymakers, the gaps between potential and actual institutions highlight the leverage points where effective change might be made.

These objectives are pursued, to varying degrees, by international organizations in conjunction with state and non-state actors. These objectives form a part of GEG because they are associated with transboundary issues in one of three ways Florini and Sovacool, ; Lesage et al. First, some objectives, like managing global climate change or nuclear terrorism, clearly relate to the cross-border externalities of energy production and use. They exhibit global public goods characteristics and hence require action beyond the national level to avoid the collective action dilemmas associated with such goods Karlsson-Vinkhuyzen et al.

Second, other objectives, such as protecting human rights or reducing energy poverty, principally relate to individuals within national borders, but elicit concern and problem-solving or problem-causing action from international sources Ghosh and Ganesan, One branch of the GEG literature conceptualizes the key energy challenges such as externalities climate change , transparency issues oil price volatility or market asymmetries for example, National Oil Companies in terms of global market failure.

In spite of the global benefits to be reaped from international cooperation, states have traditionally regarded the energy sector as a crucial component of national sovereignty.


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This means that, in effect, national energy governance still reigns above regional or GEG. A key strand in the literature has been, and still is, concerned with mapping the global energy architecture. Various mapping exercises have ensued and they have all come up with a different set of institutional arrangements. Box 1 offers a summary of the results of eight different efforts to map GEG arrangements and institutions. The results are strikingly different.

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Such mapping exercises of course depend very much on how wide the net is cast. Some focus exclusively on intergovernmental organizations and summit processes for example, Colgan et al. Lesage et al. Colgan et al. The term is akin to Biermann et al.

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Cherp et al. This links to broader discussions about the difficulty to map regime complexes in general—a nice illustration is the very different mapping of the climate change regime complex provided by Keohane and Victor , on the one hand, and Abbott , on the other. A notable number of studies have been concerned with studying individual institutions and their role in GEG. Most of the literature on OPEC has tried to model its behaviour as a would-be commodity cartel, and tried to examine the influence of the organization on world oil prices.

Its programme of work includes three areas: safeguards and verification to ensure that activities are not used for military purposes ; safety and security to protect people and the environment from radiation ; and science and technology to mobilize peaceful applications of nuclear technology. The role of civilian nuclear energy in international security questions has recently attracted scholarly attention Fuhrmann, ; Brown and Kaplow, Other international institutions that have received some attention in the literature on GEG include the G8 and G20 Lesage et al.

Last but not least, the EU has an explicitly regional energy governance approach based on liberalization , which it also tries to export to non-EU countries and to the global stage Goldthau and Sitter, Beyond studying international energy organizations created by states, scholars have also turned their attention to the roles played by non-state actors such as business, civil society and science organizations in GEG.

These non-state actors sometimes participate in intergovernmental processes.

Global Energy Governance: The New Rules of the Game

The December climate conference in Paris, for instance, was attended by a large number of civil society and business groups, who all tried to influence the negotiation process. Yet, non-state actors have also established networks whose defining characteristic is independent of state approval or support. Where such networks become institutionalized and begin to set broader norms and rules, they become transnational governance networks in their own right Biermann and Pattberg, ; Green, Such transnational governance networks come in various forms.

A case in point is the REEEP, a multi-stakeholder platform to pursue cooperation in the area of renewable energy and energy efficiency. The Extractive Industries Transparency Initiative EITI , which aims to tackle corruption and graft in the upstream oil and gas sectors by facilitating voluntary disclosing of payments, is a case in point Haufler, The EITI is part of a broader wave of information-based governance schemes in global energy and climate governance Florini and Saleem, Given the enormous diversity in such transnational governance networks, it need not come as a surprise that there is equally much divergence in the effectiveness of such networks.

Szulecki et al. Nevertheless, research by de Coninck et al. A minority of scholars has focused not on institutions or on transnational networks, but on less tangible aspects of GEG such as norms for example, Gillies, and corporate elite ties in global energy de Graaff, The description provided in this section focuses on international organizations and networks, but GEG is formed by an interaction between international, national and subnational actors. The interactions between the actors are complex and characterized by multiple points of contact.

For instance, the IEA works with its member states to improve good governance and share best practices of energy policies.

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In practice, this means that the IEA interacts with multiple branches of the national governance. Further, the activity and influence of the international actors depends significantly on the issue at hand. International organizations often have only an indirect influence on issues that lie firmly within national jurisdictions, such as electrical grid infrastructure or taxation policy. Many questions about the nature and efficacy of the international—national interfaces of energy governance remain unanswered. Over time, GEG scholars have moved beyond purely mapping the global energy architecture to an evaluation and interpretation of it.

Many argue that the current global energy architecture needs reform, but the reasons for and substance of that reform is subject to more controversy. Some have proposed to create an entirely new Global Energy Agency ElBaradei, ; Akinola, , although a large majority of authors has strongly advised against it, deeming it both undesirable and unfeasible.

In the words of Lesage et al. In this section, we make two assessments of the global energy architecture. One is a functional gap analysis, based on the five overarching goals of GEG identified earlier. The other is an analysis of the legitimacy-efficacy trade-off in GEG.

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Here we thus move beyond a mere review of the existing GEG literature to add a perspective that has, in our view, been largely missing from the existing debates: What are the benchmarks against which one can assess the performance and pathologies of current efforts to govern energy? Historically, the regime complex for energy has grown for multiple reasons Colgan et al. Some institutions were created as a response to energy crises, such as the creation of the IEA in in the aftermath of the Arab oil embargo. Other institutions, such as the IEF, were created out of a desire to bridge multiple worldviews and different understandings of the global energy market.

Figure 3 provides a rough mapping of the activities of some of the largest institutions within the regime complex for energy. The activities are mapped against the five objectives identified earlier.