October 6, 2022

Can wind and solar projects translate human rights lessons into leadership?

The land-project nexus: A perfect storm for adverse community impacts

The global installed capacity of renewable energy Expansion forecast 60 percent by 2026, with wind and solar leading this growth. This process, along with The nature of compacted earth Wind and solar projects predict a worryingly parallel trajectory for adverse human rights impacts in communities near these sites. Five of the seven countries predicted to attract the most wind energy projects – China, India, Brazil, Turkey and Mexico. “High” or “Extreme” rating Regarding risk indicators related to indigenous peoples’ rights, land rights, and violations by security personnel. This perfect storm of rapid growth, land intensification, country risk profiles, and rising human rights claims will put societal impacts in the spotlight unless something changes. And it’s not just communities that are at risk.

Risks for wind and solar projects, companies and sectors

In addition to causing extensive and often irreversible damage to people and communities, human rights violations are bad news for companies. Community protests, adverse media coverage, and investor pressure—these cascading reactions all translate into operational, financial, and credit risks for wind and solar projects through project delays and cancellations, abandoned assets, reduced investment returns, and the inability to secure or maintain conversion financing. be. . Case in point: In Oaxaca, Mexico, it was Mareña Renovables It was forced to abandon and relocate a $1.2 billion project of 132 wind turbines which interfered with traditional fishing practices and cultural rituals, followed by community roadblocks, complaints, and litigation.

Legal risks are also significant, especially given the emerging landscape Mandatory human rights review laws. France’s largest electricity company, Électricité de France is facing a lawsuit for failing to conduct adequate due diligence on its Mexican wind farm project, which resulted in the violation of the rights of the indigenous Zapotec community in Unión Hidalgo. Meanwhile, the courts in Kenya And Norway They have invalidated the project’s land ownership document and revoked the exploitation license because the land was cleared without free, prior and informed consent and compensation of the indigenous people and interference with grazing rights.

And it’s not just renewable energy companies that are involved. Companies in other sectors are increasingly diversifying into wind and solar businesses or setting up temporary wind and solar projects to power their operations. In April, tech giant Amazon announced a series of new wind and solar projects Bringing the global total to 310 in 19 countries, 134 of which are not just rooftop installations, but full wind and solar farms. Similarly, IKEA’s parent company, the Ingka Group, It has 547 wind turbines and 10 solar farms in 15 countries and has Electricity sales to households began in Sweden.

The implications of this trend go beyond the project and company level. Look no further than the fossil fuel industry to see how poor human rights and environmental records can lead to investor pessimism, threaten market growth opportunities, and undermine public support and legitimacy for a sector. If renewables repeat these mistakes, the stakes are especially high. Pursuing a just transition does not only preserve human rights. It also protects the sector’s long-term sustainability and, with it, a fast and successful path towards the 2050 climate goals.

The equation is simple: if the wind and the sun weaken, so does our path to net zero. A just transition does not delay climate action It enables.

way ahead

The next few years provide a critical opportunity for wind and solar projects to improve their human rights practices before poor practices become entrenched. And preventing and mitigating adverse community impacts during deployment is an important focus in course reform. The urgent question is: what can wind and solar projects do in practice to solve these problems?

particle for direct object UN Guiding Principles on Business and Human Rights (UNGPs) is an established global standard that affirms government duties to protect against abuses by private actors and sets expected standards for corporate human rights reviews. Lately human rights And Transfer only The benchmarks showed that wind and solar companies scored poorly in implementing the UNGPs and lacked policies on some of the most prominent human rights risks during deployment – ​​including land rights, the human rights of indigenous peoples and local communities, and the protection of human rights. defenders

To fill this gap, Columbia Center on Sustainable Investment It recently launched two new resources – a Business guide And Legal initiator – which use the UNGPs to provide guidance to all companies involved in wind and solar projects to address community-related impacts during deployment. These resources provide a snapshot of how important this issue is to companies, with human rights impacts being the most common and prominent, and the business case for addressing these in terms of legal, financial, operational and credit risks. They also provide companies with a list of practical recommendations in four key areas – governance, policy commitments, participation, and due diligence, integration and remediation – as well as case studies where wind and solar companies are making progress on these topics. in canadaFor example, companies have implemented wind and solar projects in partnership with First Nations, Inuit and Métis communities, with these communities both participating in the projects and retaining a share of ownership and profits.

Wind and solar projects may have a human rights problem, but they also have an opportunity to translate these lessons into leadership to advance the energy transition. quick And Exhibition.

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