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To create a climate-safe, just and sustainable energy system we need to transform the way we produce, distribute and consume energy. This chapter sets out some key changes that are needed to help drive this transformation and get us moving in the right direction. Again, this is not presented as a comprehensive blueprint but rather an initial contribution to collective discussions on what needs to happen to transform the energy system.
1. Invest in locally appropriate, climate-safe, affordable and low-impact energy for all
Energy infrastructure is intricately connected to wider questions of local and regional development, which vary considerably between different localities, regions, countries and regions of the world. For example, in Colombia alternative renewable energy sources have been used in a creative way by people in accordance with their particular local needs, cultures and contexts. This includes the production of hydroelectric energy by means of pelton wheels and watermills, biogas production through biodigesters, solar panels for water warming and pumping and other direct uses, communal aqueducts working on solar energy, communal public transport or cycling, pedal-powered machines and wind energy to pump water out of the ground.
It is critical therefore that the emphasis is on bottom-up, participative planning and local decision making, as this is the only way to ensure that new energy infrastructure is locally appropriate and meets local needs. Globally, 84 per cent of people without access to modern energy services live in rural areas, so the only way to ensure their energy access is to prioritise decentralised energy infrastructure.
Appropriate ownership structures need further discussion and are likely to vary between different contexts and involve a mix of state, municipal, community and tightly-controlled private ownership. Expanding collective community ownership and control of energy infrastructure is a key way to help ensure community consent and support for new renewable energy infrastructure.
This is strongly backed up by the experience of Denmark, which now has one of the highest rates of renewable energy in the world. Wind power took off strongly in Denmark in the 1980s and 1990s when local residents set up wind turbine cooperatives. Farmers were given planning permission to build wind turbines on their land only if local people were able to buy cooperative shares in the energy project. People unconnected to the area were unable to buy shares and there was also a limit to the number of shares each member could buy. This ownership model led to high public acceptance of wind power, faster deployment and tremendous good will. However, in the late 1980s the national government abolished restrictions on planning permission and ownership, and as a result outside investors began to push for shares in more and bigger wind projects, which resulted in a dramatic increase in local opposition to such projects, with corresponding increases in conflicts and delays and cancellations. A similar emphasis on collective community ownership and control is facilitating the roll-out of renewable energy infrastructure in many places around the world, from Brazil to Indonesia to Belgium.
In terms of costs, renewable energy is already directly competitive with heavily subsidised conventional electricity generation in a number of countries. The IEA estimates that nearly US$1 trillion in cumulative investment is needed to achieve universal energy access by 2030. Greenpeace International estimates that by investing only 1 per cent of global GDP in renewable energy by 2050, 12 million jobs would be created in the renewables sector alone, generating fuel savings that would cover the additional investment twice over.
However, a critical question is how to finance this transition. In industrialised countries in the global North, many alternative energy projects are financed almost entirely with small contributions by local community members and often supported by public support schemes such as feed-in tariffs. However, there are still big cost barriers to initiating such projects and a risk of exclusion for people with low incomes, which means that so far it is mostly wealthy people who are able to invest in and benefit from community-owned renewable energy infrastructure. Scaling up community-owned renewables will require significant state investment, alongside policies supporting small-scale, ‘end-user’ investment, for example by local banks and microfinance supporting the creation of local energy networks and ensuring everyone can benefit from community-owned energy.
The far bigger and more urgent challenge is to support the roll-out of socially-owned and ‑controlled energy projects in the global South. Here, the responsibility for finance lies with the rich industrialised countries of the North, which are primarily responsible for creating the problem of climate change and already have a legal obligation to provide finance for developing countries’ transition to climate-safe, sustainable economies under the United Nations Framework Convention on Climate Change.
There are many potential sources of public finance which could be mobilised to fund this transition, without detracting from other important social spending needs. These include redirecting state military spending, cracking down on tax abuse by multinational corporations and wealthy individuals, taxing unproductive and dangerous financial speculation, and redirecting perverse and socially destructive subsidies. However, mobilisation of most of these sources is beyond the reach of developing countries to decide. Rather they are dependent on the political will of Northern governments to make them available, and this will is not forthcoming due to the considerable corporate and financial vested interests involved. So in the meantime, consideration of other sources of finance directly controlled by developing country governments might be needed, including using revenues from current destructive and harmful energy sources. These public finances could then be used for the urgent transition away from these energy sources to develop sustainable, climate-safe, locally-appropriate sources which guarantee the right to energy for all.
2. Reduce energy dependence
The transformation of the energy system cannot happen in isolation from the transition to fairer and sustainable economic models and more sustainable lifestyles. It is not sufficient to simply replace all of the destructive energy sources with renewable energy sources in a context of high energy dependence and growing energy demand. Such a system will continue to have major destructive social and environmental impacts. While we urgently need to roll out locally appropriate, climate-safe and low-impact energy infrastructure, this must happen alongside a reduction in energy dependence and excessive energy consumption in industrialised countries, and support for developing countries in the global South to improve wellbeing and basic services without following the global North’s energy-dependent and energy-intensive model.
Reducing energy dependence and energy consumption does not have to mean a drastic reduction in living standards for ordinary people, although it will have to mean limits on excessive energy use from very energy-intensive recreational activities. Reducing energy dependence means changing the way we produce and consume food, the way we travel and transport goods and services, how we organise our towns and cities, and how we use energy in our homes and workplaces. Many of these changes will bring about other significant benefits for people and communities. Some key steps in moving away from energy dependence include:
Transforming industrial agriculture: the global food sector, including input manufacturing, production, processing, transportation, marketing and consumption, accounts for approximately 30 per cent of global energy consumption, and produces over 20 per cent of global greenhouse gas emissions. The global industrialised and corporate-controlled nature of our food economy lies at the heart of the problem. We urgently need to embark on a transition away from industrial, high-input and intensive agriculture towards small-scale sustainable agriculture that is less energy intensive and energy dependent and which stimulates rural development and local markets. It is also critical to tackle global demand for products associated with damaging energy-intensive agriculture, for example industrially-produced meat and dairy products. This transformation should be based on the protection and extension of food sovereignty and the right of people to healthy and culturally appropriate food produced through ecologically sound methods.
Transforming transport and prioritising strong, diversified local economies: the IEA estimates that the transport sector already accounts for over half of global oil consumption and this is predicted to increase with the increase in road freight in China, India and the Middle East, which the IEA estimates will be responsible for 40 per cent of the increase in global oil demand to 2035. Reducing energy use from transport is therefore critical to building a more just and sustainable energy system. To do this requires not only regulation of the transport sector to reduce energy use and dramatic investment in public transport, but a more fundamental change to the way we plan and organise our economies so that we are less dependent on transport. For example, a return to consuming more locally-produced food; planning new town, city and rural developments and reorganising existing places so that people are able to work and socialise closer to where they live; and localising other supply chains as much as possible, so that we reduce the quantity of goods that need to be transported long distances.
Increasing energy efficiency and regulating energy-intensive industries: Reducing energy dependence also necessitates efforts to increase energy efficiency. The IEA estimates that four fifths of the potential to reduce energy demand in the buildings sector and half of the potential to reduce demand in industry remains untapped.
Some of the most important energy-savings options include improving heat insulation and building design, improving the efficiency of electrical machines, replacing old electric heating systems with renewable heat production, and reducing energy consumption by goods and passenger vehicles.
It is import to recognise however, that energy efficiency does not automatically lead to reduced energy demand or reduced energy dependence overall. In fact, energy efficiency can lead to increased energy consumption. For example, between 1980 and 2000, China halved the energy intensity of its economy, but more than doubled its per capita energy consumption. Furthermore, energy-efficiency measures can also serve to justify the further locking in of economic dependence on energy-intensive industries.
The transformation of our energy system will also require us to look at energy-intensive industries such as aluminium, steel, chemicals, cement and car production and ask what place these industries have in a sustainable economy and how they need to be transformed at their core, not just improved with energy-efficiency measures. Hence, while energy efficiency is important, it is not a solution by itself. Energy-savings measures must be integrated into a far bigger rethink of how to shift our economies towards sustainability and away from energy dependence.
3. End new destructive energy projects and facilitate a managed phase out of all destructive energy sources
The urgency of the climate crisis requires that we bring about an urgent end to the use of harmful and destructive energy sources, including an immediate moratorium on all new fossil fuel, nuclear, waste-to-incineration and mega-dam projects, combined with a managed phase out of existing fossil fuel projects, nuclear energy infrastructure, industrial agrofuels and biomass for energy and the decommissioning of mega dams. This phase-out must happen concurrently with rolling out locally-appropriate low-impact energy infrastructure, which will extend access to basic energy services, so that the transition doesn’t negatively impact the ability of people and communities to meet their basic needs.
4. Ensure a just transition and compensation and support for affected workers and their communities
Millions of workers and whole communities are currently dependent for their basic livelihoods on the current unjust and unsustainable energy system. This includes mine workers, energy industry workers, transport workers and many other groups. It is essential that the phase out of harmful energy sources and the transformation of the energy system happens with a high level of participation and input from these affected workers and their communities. This is necessary in order to ensure that the transition is a just one. There should be well-planned policies and frameworks in place to protect and support workers and communities who are directly affected, and the components of this just transition must be defined with the affected workers themselves and their trade unions and wider communities. At a minimum we believe a just transition should ensure:
- dialogue and consultation with trade unions at all levels
- sound assessment of the job impacts of the transition
- job losses as a result of the transition are minimised and job creation opportunities maximised
- affected workers are supported with education, training and re-skilling to maximise the potential for them and their communities to benefit from the transition
- the movement of jobs to new industries does not occur at the expense of decent work, and terms and conditions for workers
- affected communities are supported with sound planning and policies to drive economic diversification
- affected workers and communities receive adequate and appropriate compensation for any job losses that do occur
5. Ensure the protection of free, prior, informed consent and rights of redress for affected communities
Ensuring the protection of the rights of affected communities is essential both for reducing the negative impacts of destructive energy sources and ensuring that new energy technologies do not replicate these impacts. Energy extraction and the construction of energy infrastructure must adhere to the principles of relevant international agreements and declarations, including the United Nations International Covenant on Civil and Political rights and the Declaration on the rights of Indigenous Peoples. Key principles are:
- The right to free, prior and informed consent: prior to the approval of any project affecting peoples’ lands or territories and other resources
- Land tenure and land rights: the rights of local communities and Indigenous Peoples to the lands, territories and resources which they have traditionally owned, occupied or otherwise used or acquired.
- The right to redress: by means that can include restitution or, when this is not possible, just, fair and equitable compensation, for the lands, territories and resources which local communities and Indigenous Peoples have traditionally owned or otherwise occupied or used, and which have been confiscated, taken, occupied, used or damaged without their free, prior and informed consent.
- The right of Indigenous Peoples to their self-determination and self-government: including the right to autonomy or self-government in matters relating to their internal and local affairs, as well as their right to participate fully, if they so choose, in the political life of the state.
- The right of Indigenous Peoples to the management and customary use of natural resources: in accordance with traditional cultural practices that are compatible with conservation or sustainable use requirements.
- It is also essential to ensure that the rights of communities affected by existing destructive energy infrastructure are upheld and that communities receive adequate compensation and reparations for their loss of land, livelihoods, culture and dignity.
6. Tackle the international trade and investment rules that prevent the transition to a just and sustainable energy system
As indicated above, transforming the energy system necessitates direct democratic control over energy infrastructure and resources and governance of these resources in the public interest. The transformation of the energy system therefore necessitates the dismantling of the international trade and investment agreements that undermine the sovereignty of democratically-elected governments and foster the privatisation and commodification of energy and natural resources. These agreements, and international arbitration processes like ICSID which enforce them, are part of the architecture of impunity of transnational corporations. They enable these corporations, investors and other private interests to use opaque international legal processes to ensure their continued control over destructive and harmful energy sources and continued profit-making opportunities from the unjust and unsustainable energy system.
7. Facilitate the sharing, transfer, development and local adaptation of low-impact energy technologies
Transforming the energy system to reduce greenhouse gas emissions in the time frame we have to avoid climate tipping points requires the urgent worldwide deployment of low-impact, climate-safe technologies in very short time frames, which in turn requires urgent measures to facilitate technology transfer. Technology transfer is understood here in its most comprehensive definition as set out by Third World Network, involving the transfer of skills and know-how to use, operate, maintain as well as to understand the technology so that further independent innovation is possible by recipient firms. It also includes copying the technology through ‘imitation’ or reverse engineering, adapting it to local conditions and eventually designing and manufacturing original products. Addressing the barriers to technology transfer created by global intellectual property rules is therefore an urgent essential step in facilitating the transformation of the global energy system.
8. End perverse incentives for dirty and harmful energy
In order to phase out harmful energy sources and accelerate the transition to a just and sustainable energy system, we need to end the perverse incentives that artificially prop up or legitimise its continuation. These include carbon trading and subsidies, tax breaks and other incentives for fossil fuels, industrial agrofuels, nuclear power and mega dams; and false solutions like CCS and large-scale geoengineering. Action on fossil fuel subsidies must follow the roll-out of affordable, climate-safe low-impact energy sources so that the removal of such subsidies does not impact on energy access for ordinary people and communities.