The energy transition will be socially just, or it won’t happen
A socially just energy transition can only be achieved together. To form this common ground, to exchange different experiences and to hold strategic discussions, it was for these reasons that representatives of European trade union federations, NGOs, think tanks, the climate movement, the scientific sector, and politicians of different levels met at the invitation of the GUE/NGL Group in the European Parliament, the Rosa Luxembourg Foundation Brussels Office, and Transform Europe, on 5 December 2016 in Brussels for the conference "Just Transition".
The energy transition is happening. The question is just under which conditions and, above all, which participants will shape the energy transition in the future. By means of the recently published winter package "Clean Energy for All Europeans" on the revision of the EU internal energy market and the Energy Union, the EU Commission has, first, put the brakes on, thus providing the fossil fuel industry, and all participants who have found the adaptation difficult so far, with a breather. The Commission mainly uses capacity markets for fossil power plants and the liberalisation of the promotion of renewable energy to serve the interests of the large power companies and allows them to restore control of the energy transition. The question of how the energy transition can be implemented in a socially fair and democratic manner is ignored, as too often in EU strategies.
The topic of justice is thus one of the most crucial areas of many discussions in the transition: From questions of climate justice at the World Climate Conference in Marrakesh, via the level of European and national politics, to energy conflicts at the local level. Discussions concerning the possibilities and obstacles of a just transition are thus in touch with the latest trends.
The Challenges of a Just Transition
In the first of a total of four panel discussions, it was also about the question of what the tasks of a Just Transition are, namely from the perspective of regions that are particularly strongly affected by the fossil fuel phase-out.
Leszek Swietalski, Secretary General of the Union of Rural Municipalities of Poland, made it clear from the very beginning that there are both economic, technical, and also social challenges for decarbonisation. Even if coal continues to be the principal energy source in Poland, there is an increase in the awareness of political decision makers that the use of coal must be scaled back little by little. A rapid change is however not in sight. Coal-fired generation is still heavily subsidised. "Miners and local communities are therefore lied to about the future", says Swietalski. In the case of energy issues, the fossil fuel industry has, furthermore, the power of interpretation. The awareness of the population that an energy transition is necessary is increasing only slowly.
That it can also be done differently in a country like Poland, however, is shown by the example of the small community of Margonin in the northwest of Poland. With the help of EU subsidies, renewable energy is increasingly invested in locally without incurring any new debt, reports the Mayor, Janusz Piechocki. The residents of the community can participate in democratic decisions on energy conservation projects, and can thus become an active part of the energy transition. Simultaneously, the new image of an ecological municipality also ensures more tourism.
Which tasks must be fulfilled for a structural change at the local level is illustrated by Torsten Poetzsch, the Mayor of Weißwasser. His example shows how great the challenges can be at a local level in the mining regions. In Weißwasser, the population halved after reunification as a result of de-industrialisation. Jobs disappeared, particularly in the mining industry, coal-fired generation, and the glass industry. As a consequence of high unemployment, more and more people, mainly young women, migrated away from the region. Most of those who remained were men with a worse formal level of education. The image of a "town of pensioners" and a "town of losers" was not just spread by the media, but was also firmly embedded in people’s minds.
In the last few years, however, there has been a turnaround. In the meantime, Weißwasser has become one of the "European Energy Award" municipalities that have made it their goal to make special efforts in order to increase energy efficiency and to actively contribute to the fight against climate change by reducing CO2 emissions. Tourism was expanded and families with children moved back into the community. According to Poetzsch, this change is, however, endangered by the extreme right gaining in strength. There are also problems with access to EU subsidies. The necessary equity capital can often not be raised from the municipalities’ budget. The municipality is therefore requesting a regional structural fund to be able to make targeted investments in constructing new infrastructure.
To what extent the municipal budget can be connected to the coal and the fossil fuel industry is shown by the example of the mining community Andorra in Aragon (Spain). The Mayor, Sofia Ciércoles, reports that 4,000 miners were employed in brown coal mining at its height. Now there are only about 100, out of a population of around 8,000. The largest employer is the local thermal power plant, which is closely connected to the mining at a local level. The thermal power plant itself is highly subsidised. Nevertheless, the plant’s income is very important for the municipality’s budget. It would thus require more support from the Spanish state to initiate the required investments for a structural change. Ciércoles also stresses the importance of ownership issues in this regard: "Nationalisation of the energy sector creates more democratic control and certainty during a structural change". Her community requires a decarbonisation plan and a gradual phase-out of coal-fired generation, with a simultaneous diversification of energy consumption.
Peter Singer, a local politician from the Left Party, Cologne, reports on the Rheinische Braunkohlerevier (Rhenish brown coal field). The region is home to several coal-fired power plants and three large surface mines. The industrial sector employs a total of up to 18,000 people. The fossil fuel industry thereby accounts for about five per cent of the jobs in the region. There is currently a dispute about the end of the fossil fuel industry. The red-green state government has secured the brown coal mining sites until 2045; there is no clear exit scenario to date. The lack of a plan by the existing political system is also evident with the question about a structural change. One thing is certain for Singer, that there may not be de-industrialisation, but that new industrial jobs must be created: "Local recreation areas and woods full of wind turbines are not a solution." Another challenge is that the regional energy monopolist RWE is no longer able to generate profits with coal-fired generation. The group will probably not be able to pay the costs for the fossil fuel phase-out and the conversion costs.
In the subsequent panel debate, one of the questions was, among other things, how investments can be ensured at a local level. For example, the tax revenues are no longer sufficient in Weißwasser to continue to bear the title of European energy community. There are also funding problems for a structural change in municipalities in Poland. A representative of the Greek Syriza party made it clear that one may no longer talk about a Just Transition in times of austerity and growing poverty: "The energy transition is not possible with the European austerity policy."
The Trade Union Perspective: Investments for structural change are necessary
Many of the challenges for a Just Transition are connected to the question of power and the assertion of interests at the European and national level. The influence of the fossil fuel industry thereby continues to be considerable. A joint strategy is therefore necessary to counter this dominant position. Representatives of several unions exchanged views in the second conference session about whether the different concepts of a Just Transition can grow into such a strategy.
Benjamin Denis from the European Trade Union Confederation (ETUC) reported on controversial debates with colleagues regarding the fight against climate change. The neoliberal globalisation that resulted in the uncertainty of working and living conditions complicates discussions about the energy transition.
Directing his remarks at environmental organisations, Denis makes it clear that the required Just Transition is not a "delaying strategy", but the only possibility to organise a socially just energy transition, in which the affected employees have a right to a say. Fights to preserve and expand workers’ rights, also in the renewable energy sector, are thus also vitally important for the European Trade Union Confederation. What is also crucial is the request for a European Just Transition fund to be able to finance the structural change. Concerning the winter package for the internal energy market and the energy union, the ETUC would like to embed guidelines in the governance structure that obliges the Member States to observe social standards. At the same time, Denis pointed out the social dimension of CO2 emissions: "One tonne of CO2 that is used in Romania to heat an apartment is not the same as a tonne of CO2 that is emitted by an SUV in a rich suburb."
Matthew Lay from the European Federation of Public Service Unions (EPSU), made it clear that his union feels committed to the basic principle "No Jobs on a Dead Planet". But the fears and concerns of employees must be taken seriously, especially against the background of the shift to the right in Europe. A European industrial strategy is therefore needed that takes with it workers from the fossil fuel sector. They should not be played off against environmentalists. Lay considered it a success that Just Transition has become a preamble of the climate agreement in Marrakesh. Lay also reaffirmed that the important question is whether there will be an adequate structural fund. But that this wasn’t possible as part of a neoliberal order.
Jose Luis Villares from the Spanish Union of Mineworkers (CCOO) revealed that mining communities must be addressed directly in order to tackle infrastructural measures. New industrial sectors must be established in these. By implementing different projects in Spanish communities between 1998 and 2005, there was partial success in creating more jobs than those that were lost due to the end of mining. Retraining and further education were very important during this process. For example, there were scholarships for children from worker families.
But there were also many problems in Spain that partly remind one of the situation in Lusatia: Many people moved away. Especially people with a lower level of education were forced to stay. Funds that were intended for structural change were not used for their specific purpose either. Instead, they were used for new sports facilities, swimming pools, and museums. The economic and financial crisis of 2008 and the years following then severely exacerbated economic problems in the (former) mining communities. Subsidies were then even completely withdrawn in 2011 as part of the enacted austerity policy. Meanwhile it can be said that the goals of structural change had been completely missed.
In the subsequent discussion, it was made clear once again that the question of austerity policy is very crucial. Without any targeted investments, there will not be a socially acceptable energy transition. However, it remains unclear how the funds necessary for investments can be provided. The Just Transition fund, as requested by the unions, must be drawn up conceptually even more strongly. For example, questions remain open regarding which interfaces there should be with the European Emissions Trading Scheme, and how it can be ensured that scarce financial resources go to the municipalities that really also want a structural change. To prevent corruption, radical democratic elements and a strong civil society are required locally.
It was additionally pointed out that a Just Transition fund can only be one measure among others. The problem of fuel poverty can only be solved by price fixing and social tariffs, for example.
The Parties’ Point of View: How do we shift the balance of power?
After the trade union representatives, politicians from Left and Green parties from different countries were then requested to report on their suggestions for a Just Transition during the third panel discussion. Thomas Domres, a member of the regional parliament of the Left Party in Brandenburg, laments the fact that there is a pro-coal majority in the Parliament and a strong industrial union (IG BCE) that fights for the preservation of the brown coal surface mines in Lusatia. This makes it difficult to jointly advocate a fossil fuel phase-out and a structural change. Jana Pinka, a member of the Left Party in Saxony in the regional parliament, also laments the fact that there is no exit scenerio for brown coal in Lusatia. She reproaches her colleagues from Brandenburg for the fact that the red-red state government decided against buying the regional energy monopolist Vattenfall; it would thus have been possible to exit brown coal in a socially acceptable manner. Through the sale of the open-cast pits and power stations in Brandenburg, Vattenfall, as a multinational group, is evading responsibility. Claudia Beamish from the Scottish Labour Party also sees this risk, not just with respect to the Lusatia region. She made it clear that companies must also be financially responsible for the Just Transition.
It is particularly the large energy groups that would have to pay for a Just Transition that are, however, given special treatment by European policy, as Claude Turmes, a Member of the European Parliament, pointed out. The auctioning of emission rights in the European emissions trade mainly discriminates against small providers and energy cooperatives, while the capacity markets are subsidies for the large fossil energy groups. Inger Johansen from the Danish Red-Green alliance then also raised the question about power and democracy, as implementation of the goals ultimately depends on the existing balance of power.
The crucial question of how social and ecological players may move the balance of power so that an implementation of their own concepts becomes possible was unfortunately not discussed. There is at least a major consensus on the demands of the unions that public investments are required, as there is also on the participation of the parties involved to organise a successful structural change. This was also confirmed by the discussants Kate Hudson from the British Left Unity party and Konrad Rychlewski from the Polish RAZEM party.
A structural change requires predictability and social stability
A practical perspective was opened up by Walter Wendt-Kleinberg in the fourth and last panel discussion round. He reported on his work experience in the church with miners from the Ruhr area. The downsizing of coal production, which was decided on in 1998, required a reduction from 85,000 to 25,000 jobs over a period of seven years. During this time, mines, coking plants, and operations were closed, subsidies were reduced, and productivity increases were implemented. (The open-cast coal mining that employed up to 500,000 people in the Ruhr area during its heyday is supposed to be phased out by the year 2018.)
Wendt-Kleinberg clarified that it was especially the strong IG BCE that ensured that the downsizing was bearable during this period. A level of union organisation of almost 100% and a close political connection to the Social Democratic party made a politically controlled structural change possible. "The people were not just simply released to the open labour market. The objective was to bring the employees back to work", emphasised Wendt-Kleinberg. This process was supported with advanced training and education. There was additionally the possibility for miners who didn’t enjoy it in other companies or sectors to return. Social stability and predictability was thus ensured.
The many employed miners in Lusatia in eastern Germany were not able to experience this social stability and predictability after reunification. The approximately 90% reduction in employees was not cushioned by social plans. It is therefore also of the utmost importance to politically shape the second impending transformation process in the region, as was emphasised in the discussion many times.
What is clear is that there are different pathways for the energy transition. This was also emphasised by Molly Walsh from the NGO Friends of the Earth Europe: "There is a very unfair development path, such as the destruction of coal mining under Margaret Thatcher, which leaves the people and specific regions alone and thus also plays them into the hands of right-wing populists, and there is a progressive development path, in which control of the new means of production is assumed, and where the transformation process is thus politically controlled." Walsh furthermore cautioned that the many environmental NGOs have to ask themselves how seriously they take the Just Transition: "How seriously do they take work and life conditions, if they form an alliance for Green Jobs together with green capitalists?" She therefore pleaded for more joint initiatives of the unions and the environmental movement.
Besides targeted investments for a structural change, participation of the parties concerned and workers’ rights, it therefore became clear that social stability and predictability is above all also required for a fair transition.
Furthermore, a new political narrative is demanded, which manages to move people, as Maite Llanos, from the Association of Trade Unions for Energy Democracy (TUED), pointed out. The slogan of the Alter-globalisation movement – "Another World is Possible" – would no longer function. A narrative that accepts the challenges of climate change and the energy transition from the Left, beside the above-mentioned elements of a just transition, must open up a radical democratic perspective and must involve the fight for common property. No less than the relationship between man and nature must be rewritten.
Key results of the conference and the next steps
Broad discussions in different directions took place throughout the day. Participation from several European countries and different perspectives ensured an honest and sometimes also controversial discussion that encouraged joint exchange but also promoted the search for the joint strategy of a Just Transition.
Jean-Claude Simon from Transform summarised some similarities in his closing statement, in which he praised the showcase projects of a Just Transition, such as ecologically sustainable communities, and in which he simultaneously clarified that the state must be more heavily involved in the energy transition. This requires a TOP-Down flow of public finances for the structural change and a simultaneous bottom-UP flow of democratic decision making. Realistic political concepts are necessary, which start at the local level and are embedded in a greater transformation strategy that reaches beyond the status quo. He also required more social-ecological research for this.
Manuela Kropp, Policy Advisor to the Member of the European Parliament, Cornelia Ernst, embedded the conference for the Just Transition in a series of workshops that were and will be organised by the GUE/NGL parliamentary group and the Rosa Luxemburg Foundation Brussels Office. A joint process was initiated during a workshop on the internal energy market in June 2016 to formulate a Left strategy in European energy policy. The emphases are thus on the topic of energy poverty and a just structural change.
Precisely these two main topics will then also be further developed with a similarly large group, as Maxime Benatouil from Transform pointed out. More activities will take place in 2017 on the range of topics on energy poverty and the topic Just Transition, as well as the restructuring of the energy sector. The organisation of European conferences as an area for a lively collaboration and the exchange of views and arguments was then also rewarded with applause by all participants.
In conclusion, Martin Schirdewan, Director of the Rosa-Luxemburg-Stiftung, Brussels Office, stated that it was a great success that many similarities had been established and that there had been agreement to further cooperate on the topic the following year. At the same time, however, he also emphasised that major tasks still had to be dealt with. Majorities would still need to be shifted in order to also be able to implement requirements.
Above all, this requires a new alliance of social and ecological actors. Because the dominant position of the fossil fuel industry, of the energy-intensive industry, and partly also of the industrial unions, prevent a political shaping of the energy transition. The Left and the ecological parties, such as environmental associations and the climate movement, have so far not been successful enough in persuading the people affected on the ground to be involved in an energy transition. It has become clear that a union organisation is a key aspect when it concerns the implementation of a Just Transition. Unions should therefore open themselves up more in order to gain more comrades-in-arms. Furthermore, connection points for new allies are, however, also required, e.g. the church, as well as connections with other fights, such as the fights against austerity. This is the only way that a just energy transition can also prevail in the future at EU level against the interests of "grey" and "green neoliberal projects".
Author: Malte Fiedler, firstname.lastname@example.org
Contact: Marlis Gensler, Rosa-Luxemburg-Stiftung Brussels, email@example.com