New Book: Challenging the rise of Corporate Power in Renewable Energy: Strategic opportunities for public ownership and industrial and economic development, by Dexter Whitfield, 26 January 2023.
A new dimension to the climate crisis has emerged as a result of the corporate domination of the renewable energy sector. The book details strategies for a democratic public future for renewable energy, protection of the built environment, nature and biodiversity. and demonstrates how decarbonisation, retrofitting, environmental adaptation and protection create new economic and industrial opportunities and generate significant good quality jobs.
One of the Top ten beach reads to ideologically warm up any long hot summer – Labour Hub. “Dexter Whitfield offers an alternative: a renewable energy programme rooted in saving the planet, not saving the fossil fuel industry from itself, More than enough to brighten up any beach read.”
https://labourhub.org.uk/2023/07/25/top-ten-beach-reads-to-ideologically-warm-up-any-long-hot-summer/
Scale of corporate domination
This book exposes how corporate interests dominate the renewable energy sector. These include private investment funds, venture capital funds, private equity funds and subsidiaries fossil fuel companies which are developers and owner-operators of wind farms, solar parks, battery storage, hydro, biomass and energy-from-waste projects. Market ideology dominates the sector and outsourcing is widespread.
These projects are bought and sold in a secondary market with development rights and ‘construction-ready status’, either as individual projects or as part of a portfolio of operational projects, often located in several countries. The analysis is based on the European Services Strategy Unit Global Renewable Energy Database which contains 1,622 transactions between 1st January 2019 and 31st December 2021.
Several publicly-owned companies in Norway, Sweden, Denmark, France, Germany, China, Romania and the Republic of Ireland are developers and owners of renewable energy assets, but the public sector accounts for 4% of renewable energy global generating power.
Deep structural flaws
- Private Equity Funds have carved out a pivotal role in financing and owning renewable energy assets – they acquired 369 renewable energy assets and sold 178 projects between 2019-2021.
- 41 major renewable energy companies registered in tax havens, were involved in 264 transactions to acquire assets whilst a further 47 transactions involved the sale of renewable energy assets. The use of tax havens to avoid or reduce corporate taxation increases corporate profits but reduces tax revenue for governments.
- A sample of 20 private renewable energy companies paid their shareholders £8.75bn (US$10.7bn) in dividends in the study period reflecting a high level of profiteering in the sector.
- Despite the wide criticism and failure of many Public Private Partnership projects, the World Bank and regional development banks continue to promote the PPP model for renewable energy projects in developing economies with 2.928 PPP projects signed since 1997 plus 839 fossil fuel projects.
Public ownership, values and economic, social and environmental justice
The book sets out the attributes of public goods and ten public service principles and a Core Public Values Framework is based on five key pillars – quality, effectiveness, equality, efficiency and sustainability – that are essential in providing public infrastructure and services to meet social, economic and environmental needs and human rights. Not only are the five pillars inter-dependent but they are also dependent on inputs, working methods, impacts and outcomes, outputs and monitoring and evaluation.
Challenging corporate domination of renewable energy
Whitfield describes various ways in which the corporate domination of the renewable energy sector can be challenged, for example by eliminating companies that use tax havens; by requiring improved democratic accountability and continuous community and trade union participation in planning and service delivery; by direct investment in place of auctions; by intervention in private sales of assets. He sets out a strategy to significantly increase public ownership of renewable energy including via remunicipalisation, new national and local public sector organisations and direct investment in renewable energy projects, decarbonisation and retrofitting.
Spokesman Books – https://spokesmanbooks.org/ (Paperback £18.00, ePub £10.00).
Additional data available – https://www.european-services-strategy.org.uk/public-ownership
Book Review – The Great Green Scam
Helen Mercer, Morning Star, 17 April 2023 – highly recommends an invaluable guide to the state of private ownership of renewable energy, and what to do about it.
Dexter Whitfield has performed an invaluable service over the years in researching the mechanism of corporate control over public services and its extremely profitable but socially disastrous effects. He has written widely on creating “a public alternative to the privatisation of life.”
Here he turns his attention to the provision of renewable energy. Painstaking research into annual reports, company press releases and corporate bulletins shows that globally the private sector provides 86 per cent of the capital investment required: public-sector involvement is insignificant except for facilitating this private investment through public/private partnerships.
Private equity companies such as BlackRock “have carved out a pivotal role financing and owning renewable energy projects”: pension funds also play a significant role.
A sample of 20 private renewable energy companies paid dividends between 2019 and 2021 of £10.7 billion. And of course, among such stakeholders, there is widespread use of tax havens.
He exposes how private companies have used environment, social and governance benchmarks to greenwash their activities and to exaggerate the benefits of private-sector involvement.
Similarly, he exposes the parallel marketisation of nature and biodiversity, paraded as a means to value natural resources with a view to their conservation, but actually turning “ecosystem services” into financial assets which can be traded in a market with an estimated value of $120 trillion per year.
Having laid out the ongoing capture of environmental policies by the private sector and by neoliberal economics, in the second part Whitfield considers how this dominance is to be challenged and what national and international strategies are needed for the transition of human economies to renewables.
Prominent among these recommendations is a radical increase in public ownership so that “all public financial support must be conditional on binding agreements that give the public sector the first option to acquire full ownership of a project in any sale.”
A new agency, a national renewable energy agency, is needed to increase direct public investment and nationalise key companies.
Other forms of government influence and direction of the sector are needed in order to, for example, strengthen national grid networks, and promote the decarbonisation of agriculture, transport and construction.
Government activities, he emphasises, should be bound by frameworks for assessing the impact of policies on aspects of social and economic justice.
Whitfield has tackled a huge topic and the size of the challenge is well-illustrated in the ideas being discussed by the PCS for a national climate service.
His research and prescriptions will help to inform future debate.
SOCIALIST PROJECT: THE BULLET
Global Trade in Renewable Energy Assets Soars
23 May 2023 Dexter Whitfield
Draws on Global Renewable Energy Secondary Market Database 2019-2021 which reported on 1,622 transactions in renewable energy assets in a three-year period. It reveals the dominant role of private equity funds, wide use of tax havens and limited role of public ownership. The market creates new opportunities for profiteering from the generation of renewable energy. Revenue from the sale of assets accrues to the parent company that owns the equity and does not directly benefit the project, community and local economy.
It is vital that corporate domination of renewable energy is challenged combined with establishing the case for increased public investment and ownership of renewable energy. Eight ways in which corporate ownership can be challenged are described.
Ways in which local, regional and central government can be publicly owned, the importance of increase public ownership of renewable energy generation and return national grids and local distribution networks to public ownership are set out.
Environmental Injustice in Renewables
Dexter Whitfield – THE SPOKESMAN 154 (pages 47-55) 2023 Founded by Bertrand Russell
Examines the crisis and opportunities in the context of the climate crisis including the regional differences on dependency on coal, oil, and natural gas. In addition, there are significant structural flaws in the renewable energy sector such as the increasing reliance on market forces, the activities of private equity funds and the limited effectiveness of Environment, Social and Governance criteria.
Who will control renewables?
Regan Scott review of Challenging the Rise of Corporate Power in Renewable Energy in The Spokesman 154 (pages 116-117) 2023.
“Dexter Whitfield’s new book on corporate power in the renewable energy world is unique in looking ahead and in depth at the implications of high global financial capitalism’s penetration of the undoubtedly much needed and welcome renewable energy industries.”
https://www.european-services-strategy.org.uk/wp-content/uploads/2023/06/Regan-Scott-Review-1.pdf
