Regional governance A better fit

If global governance of energy is hard to achieve, what other options are available beyond an 'every state for itself' approach which seems more likely to lead to international conflict rather than cooperation? One possibility is to take the (international) regional level as a focal point for developing energy policy. It may be relatively easy to bring together states within a region than across regions: there will be fewer countries in the negotiating process, there may be shared common historical experiences (good or bad) to build upon or overcome, there may be possibilities for economies of scale or scope in the exploitation of resources or the development of infrastructure and there may be already established frameworks for regional integration into which energy and/ or environmental issues can be incorporated.

How far have countries within a particular region been able to devise ways of cooperating on energy and environmental concerns? There is a good deal of technical cooperation, for example to manage the operation of grids in areas such as Latin America or Southern Africa. Beyond that, however, the extent of regional policy on energy tends to reflect how far a broader system of cooperation is in place. This, in turn, may be a function of the willingness or wariness of states to pool sovereignty. There have been some notable developments of regional energy policy, four of which are sketched below.

(i) In Africa, perhaps the most important developments have taken place in the context of the Southern African Development Community, a regime which seeks to foster cooperation among the countries of the Southern African region.

(ii) In Asia, the members of the Association of South East Asian Nations, for example, have been cooperating on energy policy issues for more than 20 years, building on an initial agreement for sharing oil in supply emergencies to a series of agreements to develop energy infrastructure and foster energy investments. Asia-Pacific Economic Cooperation (APEC) is a broader forum embracing countries in the Pacific Basin: North and South American states and Australia-New Zealand, as well as those from Asia. It has a looser but broadly liberal commitment to energy matters; the main aim has been closer trade and investment links. In recent years, however, it has also addressed energy security and sustainable development matters.

(iii) In Latin America the main focus for cooperation has been in the Southern Cone where the common market of 'Mercosur' (embracing Argentina, Brazil, Paraguay, Uruguay and, since 2006, Venezuela) has a series of ambitious plans to develop integrated energy infrastructures and a common energy market, though the latter may be harder to pursue in practice.

(iv) In North America a framework for cooperation has developed over the last ten years or more in the context of regional trade agreements. The most important of these was the North American Free Trade Agreement. This agreement has, understandably, tended to emphasise the extension of free trade and access principles to the energy sector. Such an arrangement has generally been seen as benefiting the US over the other two partners, and Canadians in particular have been critical of the way in which the provisions oblige them to follow a national energy policy they regard as unsustainable (Hufbauer and Schott, 2005; Clarke et al., 2006).

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