Businesses Must Respect Human Rights for a Fair Transition to a Renewable Future

By Kasumi Maeda and Eniko Horvath

This week, world leaders, businesses and investors are gathering for the Clean Energy Ministerial to discuss tangible actions to advance clean energy following the 2015 Paris climate agreement.

The event includes the launch of a campaign to convince more companies to commit to sourcing 100 percent renewable energy.  However, discussions around the impacts of these commitments on human rights are palpably absent from the agenda.

Local communities continue to face abuses of their rights to free, prior and informed consent, land, and compensation, and residents are being forcibly displaced to make room for clean-energy projects. Without speaking about these concerns openly, we cannot ensure that a fast transition to clean energy will also be a fair one.

This is why we, at the Business and Human Rights Resource Centre, contacted 35 companies in the wind and hydropower sector, asking them about their approach to human rights and specifically on consultations with local communities. Previously, we explored the commitments companies have made to human rights on paper. Now we look at examples of how the renewable energy sector matches up to human rights obligations in practice.

The Clean Development Mechanism (CDM) is a global, environmental investment scheme that funds emission-reducing projects including in the wind and hydropower sectors.  However, even projects backed by this scheme have received scrutiny around their human rights impacts, as documented by Carbon Market Watch.  These impacts are slowly starting to become more recognized at the U.N. level.

Last November, the CDM Board adopted basic stakeholder comments regarding human rights issues.  Earlier this month, John Knox, the U.N. special rapporteur on human rights and the environment, called for the adoption of stronger human rights safeguards on CDM projects.

Even these U.N.-backed projects marred human rights abuses must not be ignored. For example, at Palo Viejo in Guatemala, from January to May 2011, local communities launched protests against Enel Green Power for allegedly withholding compensations, and demanded for the rights of Mayan descendants to claim inheritance to local natural resources. Enel Green Power claimed that the company always prioritized dialogue and funded community-development projects to meet local needs. Negotiations in November 2011 failed after Enel refused to consider profit-sharing arrangements with the indigenous community. The dam is now in operation.

Human rights abuses occur in other forms of renewable energy as well, such as at the Foum El Oued wind park in Morocco, another CDM-registered project. NGOs including Polisario, Western Sahara Resource Watch, Danwatch and African Contact accused Siemens and Nareva Holding of infringing international law when they struck a deal to develop the wind park in the occupied Western Sahara. They allegedly failed to consult the Saharawis, the Western Sahara’s indigenous population, hence failing to respect their rights to self-determination. Siemens continues to insist that it did not breach any laws and that the project bears benefits for the development of the region.

With the influx of investment into renewable energy, businesses and governments now have a unique opportunity to learn the lessons from these and other allegations of human rights impacts. Renewable energy companies are capable of doing “good” business.

The Cerro de Oro dam in Oaxaca, Mexico, co-owned by Comexhidro and the Latin Power III Fund, and financed by the Overseas Private Investment Corp. (OPIC), demonstrated its capability to amend practices to adhere to community rights. In November 2010, indigenous communities submitted a complaint to the OPIC’s Office of Accountability about the Cerro de Oro dam in Oaxaca. They were concerned with the impact of the dam on their safety, access to water and fishing areas. After dialogues with OPIC, local and regional government officials, the project was suspended and an alternative project that took community concerns into account was proposed.

In another example, Statkraft proved its ability to be open to change when the Jijnjevaerie Saami village submitted a complaint to the Swedish and Norwegian National Contact Points (NCPs) to the OECD Guidelines concerning the company’s planned wind power project in the area where the Saami village engages in reindeer herding. The NCPs accepted the complaint and reviewed parts of the case. While they found that Statkraft complied with the OECD guidelines, they also provided recommendations for how the company could work in a manner that promotes indigenous people’s rights.

While both of these examples of good practice resulted from external pressure on the companies, they demonstrate that companies have an incentive to take human rights into consideration before they start on projects in order to avoid facing delays and other costs later on.

As companies and governments strengthen their commitments to renewable energy, they must also strengthen their respect of human rights to ensure a fast and fair transition to a clean-energy world. The Clean Energy Ministerial meeting and its new initiative for renewable energy can be an opportunity to start discussing these changes and to start breaking down the silos between climate change and human rights policies and practices.
Image credit: Business and Human Rights Resource Centre

Featured image: Flickr/Aleksey Gnilenkov Eniko Horvath is a Senior Researcher at the Business and Human Rights Resource Centre, based in London. Eniko, a Hungarian national, joined the Resource Centre in 2011 as an intern and returned in 2012 as a Researcher. She is the Centre’s Western Europe Regional Researcher & Representative, and has carried out research missions to Switzerland, Bolivia, Chile, and Florida, U.S. (Immokalee agricultural region). Eniko’s programmatic work focuses on climate justice, the UN Guiding Principles, and the U.N. Working Group.

Kasumi Maeda, a national of Japan, joined the Resource Centre in November 2015 as a Research & Projects Intern. Kasumi is completing a MSc in Human Rights at the London School of Economics and Political Science. She also holds a BA in International Studies and Asia Studies and a minor in Human Rights from the University of Washington. Prior to this she worked as a student researcher focusing on the universality of human rights and genocides. She also worked with regional human rights NGOs in El Salvador and India. Her mother tongue is English, and also speaks Japanese.