Protests in Norway about the treatment of Sami reindeer herders at two onshore wind farms has put the issue of how wind deals with human rights back in the spotlight. Richard Heap looks at why this is a huge risk for investors.
Environmental activist Greta Thunberg has been unequivocal about energy. Fossil fuels are “madness” and the growth of renewables must be a priority.
But not at any cost. This week, Thunberg joined protestors blocking Norway’s energy ministry because it has not ended production at two wind farms in the 1GW Fosen wind complex in Norway.
In October 2021, Norway’s Supreme Court ruled that the permits for the 288MW 80-turbine Storheia and 256MW 71-turbine Roan wind farms were invalid due to the projects’ impacts on reindeer herders from the Sami indigenous community. However, both projects have stayed in operation despite the ruling. Thunberg and her fellow protestors argue that the growth of renewables cannot come at the expense of Sami rights.
Fosen owners Statkraft, TrønderEnergi and Nordic Wind Power DA have said the permits were secured following extensive negotiations with licensing authorities, and “special importance was given to reindeer herding” during a long process. The government wants a solution where turbines and reindeers can co-exist.
It may be odd to see Thunberg at this protest because of her vocal support for action on the climate crisis, which would include growing renewables. It will no doubt embolden critics of wind to say that even Thunberg is against this wind farms, and make spurious arguments that wind farms infringe their rights too.
But her presence at this protest is of little significance beyond the headlines her ‘star power’ generates for the cause. The real issue is that the Fosen dispute is an example of how critics argue that some wind farms infringe human rights.
The ruling by Norway’s Supreme Court in 2021 was based on article 27 of the United Nations International Covenant on Civil & Political Rights, which said ethnic, religious or linguistic minorities “shall not be denied the right… to enjoy their own culture”. The court found Sami reindeer-herding was a protected cultural practice and that building wind farms on herding sites infringes it.
Yet there was little clarity in the court ruling over what should be done with the operational turbines, and it is that lack of action that led to these protests.
The future of the Storheia and Roan wind farms is unclear. But this dispute draws attention to a longstanding criticism that wind developers sometimes use sites without regard for indigenous communities. It has affected projects in countries including Kenya, Mexico and Norway in recent years, and should be regarded as a substantial risk for investors in similar projects.
We last wrote about alleged human rights abuses by renewables companies in mid-2020, with a focus on research from the Business & Human Rights Resource Centre (BHRRC). It said that, on average, the 16 utilities and developers it looked at were only complying with 22% of their obligations to protect human rights.
That grew to 28% in a follow-up report in late 2021, but the BHRRC said progress on these issues is too slow and that firms are performing poorly. This said there had been over 200 allegations of human rights abuses in renewable energy in the preceding decade, of which 44% were linked to wind and solar farms. They included land grabs, indigenous rights violations, and denial of workers’ rights.
The BHRRC has also carried out more extensive research on alleged abuses in some countries. In June 2022, its analysis of wind in Kenya focused on issues at four projects: the 365MW Lake Turkana, a 300MW scheme by Gitson Energy, the 90MW Baharini, and the 60.8MW Kinangop. Across these schemes, it said there had been a range of allegations, particularly related to land and worker rights.
Investors and developers should regard this as a major financial risk. Two of the Kenya projects – Baharini and Kinangop – have been delayed indefinitely, which is expensive for the companies proposing the schemes; and, at Kinangop, there was also an unsuccessful attempt by the investor to secure compensation via the International Court of Arbitration.
In Mexico, French utility EDF ultimately failed last year in a bid to build the 252MW Guinaa Sicarú wind project following a long-term dispute about human rights with the indigenous Union Hidalgo community. The cultural practices may vary, but the risks for investors are similar wherever these issues may arise.
There appears little more that the developers could have done at Fosen, and so we sympathise. Nevertheless, it is a reminder that land is always political, and that human rights issues are a major financial risk. Nowhere is this truer than if an operational wind farm has to be shut down or dismantled
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