BHRRC's first Renewable Energy & Human Rights Benchmark
June 29, 2020
The Business & Human Rights Resource Centre (BHRRC) has found that the renewable energy sector has a high risk of adverse human rights impacts, with 197 allegations of human rights abuses linked to renewable energy projects since 2010. The allegations are global and span every major renewable energy sub-sector, including wind, solar, bioenergy, geothermal, and hydropower. The majority of the allegation have been made about projects in Latin America, including reports of killings, threats, and intimidation; land grabs; dangerous working conditions and poverty wages; and harm to indigenous peoples’ lives and livelihoods.
To help tackle this, the BHRRC launched its first Renewable Energy & Human Rights Benchmark which analyzes the human rights policies and practices of wind and solar energy companies and scores them on their human rights approach.
The benchmark includes 16 of the world’s largest publicly traded companies in nine different countries, which represent more than 130,000 Megawatts (MW) of wind and solar operating capacity across every region globally. The benchmark scored companies on 13 “core” indicators (non-sector-specific human rights requirements laid out by the UN Guiding Principles on Business & Human Rights) and 19 sector-specific indicators, such as indigenous rights, land rights, labour rights, right to a clean environment and transparency and corruption. (The methodology is available here).
The BHRRC finds that:
“[N]one of the companies analysed are currently fully meeting their responsibility to respect human rights, as defined by the UN Guiding Principles.” Iberdrola (53%), Acciona (51%), Orsted (47%) and Enel (44%) led the benchmark, showing progress in adopting appropriate human rights policies; while half of the companies scored below 10%. Only four companies (Acciona, Enel, Iberdrola, and Orsted) specifically commit to implementing international standards on business and human rights.
Companies scored better on core human rights due diligence indicators, as well as areas of anti-corruption and health and safety. They “scored particularly poorly on high risk issues frequently cited in allegations of abuse, scoring zero across the board on their commitments to respect land rights, a rights-respecting process for land acquisition, and a just and fair relocation policy.”
“Half of the companies (8 of 16) (Acciona, E.ON, EDF, EDP, Enel, Engie, Iberdrola, Orsted) received at least partial credit for all five indicators in this theme, suggesting these companies are taking initial positive steps towards due diligence, but not yet meeting all requirements to make this due diligence effective.” Blackrock commits to paying a living wage to its employees; while Iberdrola and EDP report to have closed the gender wage gap, with Acciona setting a timebound goal for closing this gap.
Acciona is the only company with a public commitment to provide for or cooperate in access to remedy. “Eleven companies received at least partial credit for having grievance mechanisms available to workers and/or external individuals, including communities; however nine of those companies lost points for failing to adopt a policy that ensures these mechanisms are available in all appropriate languages (only Enel and Orsted demonstrated this).”
“Only one company (Iberdrola) has a specific public commitment to respect indigenous peoples’ rights in line with international standards (in this case ILO Convention 169 on Indigenous and Tribal Peoples).” None of the companies had a policy commitment committing to respect of IFC Performance Standard 5. “Engie has a policy to ensure displaced persons give their free and informed consent, but do not commit to securing consent prior to relocation.” None of the companies had a position on human rights and environmental defenders “despite the fact that in 2019 renewable energy was the industry with the fourth highest number of allegations of attacks on defenders.”
Enel, Engie, Iberdrola, and Orsted received credit for acknowledging the particular risks associated with the sourcing of their minerals, while Enel and Iberdrola received credit for publicly describing the steps taken to assess and mitigate these risks. Acciona and JinkoSolar received credit for adopting 100% renewable energy portfolios, while Orsted is the only other ranked company that has a timebound commitment to transition to 100% renewable energy. Acciona and Orsted were the only companies that score points for conducting both environmental impact assessments and full life cycle assessments for all projects.
The BHRRC concludes with a number of recommendations for renewable energy companies to better meet their human rights obligations.
“The climate crisis will not be averted without a rapid expansion of the renewable energy industry. However, a net-zero carbon future can and must go hand in hand with sustainable development, poverty reduction and reducing inequality. Putting people and their rights at the centre of the renewable energy business ensures we leave no one behind.”