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Renewable energy sector falling short on human rights, putting efforts to tackle the climate crisis at risk

BHRRC Fast & Fair briefing

  • New benchmark assesses 16 of world’s largest publicly-traded wind and solar producers against human rights standards
  • Nearly half (7/16) scored below 10%, with three quarters (12/16) scoring below 40%.
  • Iberdrola, Acciona, Orsted,& Enel stood out as scoring the highest overall, but no company scored above 53%.
  • All companies scored zero on respecting land rights, and only one has a public commitment on indigenous rights in line with international standards

New York, USA – The first ever human rights benchmark of renewable energy companies reveals serious weaknesses in industry efforts to protect workers and communities, creating risks in a sector vital to countering the climate crisis.

The renewable energy industry is an indispensable part of the fight against climate breakdown, and the COVID-19 pandemic has only served to reinforce the urgent need for rapid change to a more equal and sustainable global economy. Yet the sector’s growth has been dogged by a rise in allegations of human rights abuse - including killings, threats and land grabs - with at least 197 allegations since 2010, including around 40 in the last year.

The new benchmark (out today) from Business & Human Rights Resource Centre reveals policy and practice gaps the renewable energy sector must urgently address to ensure the transition to a net zero-carbon economy is both fast and fair, respecting human rights.

The benchmark assessed 16 of the largest publicly-traded wind and solar producing companies* against a methodology developed through seven global consultations involving more than 100 stakeholders.

It reveals that nearly half (7/16) of the companies scored below 10%, with three quarters (12/16) scoring below 40%. No companies scored above 53%.

Four companies stood out as the highest-scoring overall, although allegations of abuse have been raised against the highest-scoring company. On the most important indicators of companies’ basic human rights obligations, the sector’s average score was on par with other high-risk industries, such as apparel, agricultural products, extractives, and ICT manufacturing – suggesting more scrutiny is required of the risks in this sector.

One pressing issue is renewable energy projects developed on land used by indigenous people. These cases threaten the human rights of local communities and can impose a heavy financial cost on companies. Examples include a wind farm in Norway challenged by reindeer-herders over loss of land, a solar park in Mexico sued over lack of community consent, and a wind farm in Kenya cancelled after lawsuits by farmers and local landowners.

Companies scored poorly on some of these most serious human rights issues for the renewables sector, with all 16 companies scoring zero on respecting land rights, and only one with a public commitment on indigenous rights in line with international standards.

Good practice in the sector does exist, such as a wind farm in Mexico owned by the indigenous community, a wind farm project in South Africa that consulted with local communities about jobs and part-ownership of the project, and wind and solar projects in Canada owned by indigenous groups.

Renewable energy companies are leading the transition to a net zero-carbon economy as part of the global effort to tackle the climate crisis. Renewable energy will also play a pivotal role in ‘building back better’ following the COVID-19 pandemic. This makes it even more crucial that the renewable energy sector avoid the mistakes of other energy providers and urgently build respect for human rights in their operations and supply chains. Unfortunately, this benchmark shows the sector is falling short on human rights, especially on land rights and protecting indigenous people. This not only threatens harm to communities, but risks project delays and increased costs that could put the transition to a net zero-carbon economy in jeopardy. These results point the way for renewable energy companies and investors to make improvements to make sure the transition to a net zero-carbon economy is both fast and fair. The best way they can do this is by carrying out human rights due diligence to prevent, identify and mitigate risks throughout their operations and supply chains. Best practice exists and should be followed.
Marti Flacks, Deputy Director, Business & Human Rights Resource Centre

The Renewable Energy and Human Rights Benchmark uses 13 core indicators from the Corporate Human Rights Benchmark to assess companies against the United Nations Guiding Principles on Business and Human Rights (UNGPs). It uses a further 19 indicators developed to assess risks specific to the renewable energy industry.

All 16 companies scored zero on at least one of the 13 UNGP core indicators, meaning none of them showed they sufficiently meet the basic expectations set out by UN guidance. Nearly half (7/16) of companies scored just 1 or 0 points in total in this section.

On these 13 UNGP core indicators, on average companies scored 33%, similar to the poor average performance of other high-risk industries examined by the Corporate Human Rights Benchmark (31%).

With the average below 50%, renewable energy companies, like those other industries, are failing to maintain a comprehensive approach to human rights risk identification, mitigation, and remediation.

//ENDS

Media contacts:

Adam Barnett, Communications Officer (London-based), Business & Human Rights Resource Centre, [email protected]

Marti Flacks, Deputy Director (Washington-based), Business & Human Rights Resource Centre, [email protected]

Notes to the editor:

*The 16 companies benchmarked: Iberdrola, Acciona, Orsted, Enel, EDP, EDF Energy, Engie, E. ON, RWE, Jinko Solar, Blackrock, NextEra, Brookfield, The Southern Company, China General Nuclear Power Corp, and PowerChina.