The Financialisation, Marketisation and Privatisation of Renewable Energy: Strategies for public ownership

ESSU Research Report No.12 with the ESSU Global Renewable Energy Secondary Market Transactions Database 2019-2020; Dexter Whitfield

Key findings

  • 626 transactions in global renewable energy secondary market in 20 months in 2019-2020 cost US$289bn
  • 34% of transactions involved private equity funds;
  • The public sector accounted for only 4.4% of transactions;
  • 140 transactions involved a parent company or subsidiaries registered in tax havens;
  • Europe and North America dominated the global changes in ownership of wind, solar, hydro and battery projects;
  • 38 assets were acquired into public ownership (15,270MW), 14 assets were privatised (14,504MW) and 14 assets were transferred between public authorities (5,175MW) –there was a net gain in the number assets transferred to the public sector but only a small gain in the level of MW.
  • US$8.4bn of the total cost were fees to consultants, lawyers and asset management companies to negotiate transactions
  • Renewable energy electricity generation is largely in the control of finance capital and market forces so, that by 2050, generation, distribution and supply could be substantially owned and controlled by the private sector.

The secondary market provides a mechanism for investors to extract profit at the development or operational stages of renewable energy projects. This process enables utility and petroleum companies to ‘shop’ around to buy ‘ready to build’ renewable energy projects without committing to creating permanent in-house development capacity.

The public policy agenda must change from general demands for climate action and targets to those that focus on how the targets are going to be met and to rapidly increase public provision of power generation. The report sets out proposals to significantly increase public ownership and operation of renewable energy projects and to increase the scope and powers of regulatory frameworks.

Further details in Public Ownership and Provision section of the website.

Further Investigation of Scotland’s renewable energy projects

Revealed: Scottish wind farms owned in tax havens, Rob Edwards, The Ferret – an independent non-profit media cooperative in Scotland set up to investigate stories in the public interest – has drawn on the evidence in the ESSU report and reported the views of the Tax Justice Network, Friends of the Earth, Community Energy Scotland, Scottish Labour, Scottish Greens and the Scottish Government who are all critical of tax evasion in Scotland’s renewable energy projects.

The same article under the title of Ventient Energy: Scottish wind firm under fire over alleged tax avoidance was published in the Sunday National, 22 November 2020.