Transferring power: how accelerating equity can support the energy transition

In a recent World Economic Forum article we read about the considerable progress in the energy transition. Scores on the Energy Transition Index (ETI) are rising and more than a trillion US dollars are set to be invested in clean energy. These are meaningful steps in getting the gears of our energy transition moving.

We also see that the equity of this influx and improvement is still falling short. Notable funding into clean energy is still led by advanced economies consolidating their position and energy security, and emerging ones claiming theirs.

We need reminding of the collective planetary value we have committed to alongside the Sustainable Development Goals: Leave No One Behind.

Against the backdrop of geopolitical instability, fragmentation and increasingly insular and inward national outlooks, there continues to be a proliferation of misinformation, and a reluctance to change, the core of which is a resistance to transferring power.

This mix threatens to derail a just, equitable, and inclusive energy transition.

As a global development partner, SNV is acutely aware of the challenge around equity in the energy transition. That’s why our mission is to strengthen capacities and catalyse the partnerships that transform the energy, agri-food, and water systems to enable sustainable and more equitable lives for all.

At the very core of the systems transformations required is a redistribution of access to two forms of ‘power’; energy power, and decision-making power.

Whilst there is some positive momentum happening around alternative framing and distribution of decision-making power, as can be seen through advances in stakeholder capitalist approaches as highlighted in the Fourth Industrial Revolution, citizen assemblies, doughnut economics (city-level in particular), b-corps models, or ESG frameworks, there are still sizeable forces and counter momentum restricting more substantial change which would enable us to better cope with the breadth and depth of challenges the world currently faces.

Many of the forces holding us back are fuelled by a resistance to embrace the complexity and interconnectedness of the challenges we face. The prevailing narratives of power, such as 'global North/global South', are inherently shaped by the more powerful, who have a vested interest in protecting and preserving the status quo – or at least in ensuring that the gains in power of others don’t result in diminished power for themselves.

There’s a hollowness to these framings and – in an era of widening access to information and disinformation – this hollowness is apparent to those being held back or bearing the brunt of the challenges we currently face.

This is eroding and deepening mistrust – in governments, businesses, development actors – which is being exploited by others.

We have observed ways in which we can address this imbalance of power and onto a course toward greater equity in the energy transition.

Timely, contextually appropriate resource flows at the required volumes are a critical dimension to enabling systems transformation. Whilst considerable financing is being invested and allocated to the energy transition, we see in the contexts where we work that it still isn’t reaching those that need it the most, in the necessary forms, often enough.

We’ve seen considerable success through projects in Mozambique and Tanzania, with initiatives to establish and reinforce sustainable, commercially viable supply and distribution models for solar lighting products and services.

Other noteworthy initiatives, such as Acumen's recently launched $250 million Hardest-to-Reach programme offer further opportunities to truly make an impact, particularly through intentional focus on bottom of the pyramid and most vulnerable populations.

Results-Based Financing facilities can be important enablers of this, providing the necessary financial support for the development of the value chain in contextually appropriate forms that de-risk and take account of different vulnerabilities.

Such approaches amplify the importance of trust between actors, built on good information provision, transparency, and accountability.

In a context of rising instability and conflict, energy security needs to be seen as a shared global challenge, with the framework of global public goods. Today, the trend is still for more powerful Official Development Assistance (ODA) providing nations to finance energy projects in recipient countries. But to achieve energy justice, developing countries and local communities must be better empowered and equipped to secure their energy production.

Again, trust is central to enabling this. We have to move away from simplistic and dated constructs of ‘global north’ and ‘global south’, understand that power is much more diffuse, and build meaningful partnerships that truly value shared interests. Otherwise, trust will erode further.

An opportunity to do so exists through the EU's Global Gateway initiative. Leveraging more effective development cooperation through Team Europe Initiatives can enable greater value creation in ODA recipient partner countries.

But this is at risk of being seen as about preserving economic advantages, historical norms, and a status quo around power in Europe and a counter to China’s Belt and Road Initiative. To truly foster innovation and collaboration, it's essential to develop new forms of relationships and partnerships that can generate more significant value for non-European geographies during the energy transition.

As a cornerstone of energy system performance, energy equity must be a primary concern for stakeholders worldwide: from governments as duty bearers, to the private sector and its commitments, to local communities and individuals’ ability to hold both to account.

This is why ‘power dynamics’ along with ‘relationships and connections’ are central dimensions of systems transformation. Thus, the linearity and siloing of projects, along with walls between individual stakeholders, must be broken down to facilitate better collaborative responses to our interconnected challenges.

Initiatives from funders such as the IKEA Foundation and the Global Energy Alliance for People and Planet (GEAPP) which focus on the energy, agri-food, and water sectors are good examples. As is the recent launch of IRENA’s Empowering Lives and Livelihoods – Renewables for Climate Action initiative which aims to strengthen climate resilience and adaptation in vulnerable communities by transforming agri-food and health value chains with renewable energy. But we need more strategies like these, built around inherently interconnected and interdependent sectors.

At COP28 we saw lots of discussion about the energy transition. But if we do not hold to our promise of leaving no one behind, if tens of millions are not included, there will be no just, equitable, and inclusive energy transition.

More courageous leadership is needed within and across sectors to (re)build trust, forge more productive collaborations and sustainable solutions, and accelerate the transference of power which will lead to systems transformation.

There will be no transition if it’s not just, equitable and inclusive.

To gain insights into the framework and critical questions that must be addressed to advance a just, equitable and inclusive energy transition, read the World Economic Forum's new report “Building Trust Through an Equitable and Inclusive Energy Transition” here.