As the world rushes to meet the challenge of the climate crisis, global renewable energy capacity – and the transition mineral mining required to power it – is expanding at pace across all geographies. So too are increasing calls for a global transition to renewable energy that is not only fast but also fair: a shift that includes the creation of shared prosperity between state, private sector, and the frontline communities being asked to host vast renewable energy installations and transition mineral mines. This goes beyond traditional corporate social responsibility efforts and compensation for harms – long hallmarks of extractive industries – to direct benefit sharing mechanisms and initiatives, mandated by regulation. A number of countries in Africa have led the way, with governments and policy-makers embedding benefit-sharing models in laws governing both the mining and renewable energy sectors, from which states around the world – and perhaps particularly the Global South – can learn and take inspiration. The existence of such models is of critical importance. Evidence increasingly suggests the global energy shift currently risks veering dangerously off course from delivering a transition that is just and equitable. Across the renewable energy value chain, numerous instances of land and resource dispossession, displacement, livelihood destruction, community disintegration, criminalisation of leaders, and disempowerment of women and youth are surfacing, as documented by the Business & Human Rights Resource Centre’s (the Resource Centre) Transition Minerals Tracker, Just Transition Litigation Tracking Tool, and the Renewable Energy and Human Rights Benchmark. But a renewable energy value chain that respects and even promotes human rights through commitment to shared prosperity is possible, benefiting communities, companies and investors while enabling the urgent energy transition our planet needs. This briefing explores the relevant legislative frameworks from six African countries key to the global transition to renewable energy which seek to make mandatory private sector commitment to shared prosperity: Ghana, Kenya, Sierra Leone, South Africa, Tanzania and Zimbabwe. The frameworks span both mining and renewable energy, and include mechanisms such as community development agreements, community development funds and co-ownership agreements. Key takeaways: Clear frameworks for community benefit sharing in the mining and renewable energy sectors – which go beyond governments’ basic social and economic obligations – are essential. These should include clear requirements of the private sector, beyond voluntary corporate social responsibility initiatives. Governments should introduce regulatory interventions and make such benefit sharing mandatory, as well as monitor enforcement; Laws should require safe, inclusive community participation in all stages of a project, from conception to implementation, and ensure full integration of communities into governance structures and administrative procedures; Legal frameworks should be capable of ensuring that benefit-sharing arrangements are truly responsive to community needs, and able to confer material and other benefits, as defined by communities, including on women; Communities must have access to proper technical and financial support to create appropriate legal entities and negotiate meaningful benefit sharing agreements that truly address community needs; Legislative initiatives which enhance local land control are critical, such as Sierra Leone’s ground-breaking 2023 laws that enshrines the right to community consent in the context of industrial developments. Recognition of Indigenous Peoples’ right to free, prior and informed consent (FPIC) is an essential starting point where the projects are on or near Indigenous Peoples’ lands and territories. Impacts of the laws for communities in these countries highlighted in this analysis appear to vary. This demonstrates that even well-designed benefit-sharing frameworks can fail without proper enforcement. This requires capacitated and committed agencies, and transparency around revenues earmarked for local community development. There is also a need to define the role of traditional leaders in benefit sharing negotiations and engagements with the state and corporations and to guard against common risks like elite capture and misappropriation of funds. Nevertheless, these examples from the African continent demonstrate the potential of existing legislative frameworks – and others like them – to contribute to an energy transition that is genuinely equitable, sustainable, and just – in Africa and beyond. As national pledges to triple renewable capacity by the end of the decade encourage rapid renewable energy installation and buoy global demand for transition minerals, this is not a moment too soon. The recent launch of the UN Secretary-General’s Panel on Critical Energy Transition Minerals in April 2024 is instructive, with a goal to “develop a set of common and voluntary principles to build trust, guide the transition and accelerate the race to renewables,” while ensuring resource-rich countries and communities “benefit the most” from the extraction of transition minerals. Legislation that ensures the protection and empowerment of vulnerable populations and fosters shared prosperity can help ensure such outcomes.

From mining to renewable energy: Lessons learnt from benefit sharing legislation for a just transition in Africa

Resource Key: E4VBYPWS

Document Type: Report

Creator:

Author:

  • Business & Human Rights Resource Centre

Creators Name: {mb_resource_zotero_creatorsname}

Place:

Institution: Business &Human Rights Resource Centre

Date: August 2024

Language:

As the world rushes to meet the challenge of the climate crisis, global renewable energy capacity – and the transition mineral mining required to power it – is expanding at pace across all geographies. So too are increasing calls for a global transition to renewable energy that is not only fast but also fair: a shift that includes the creation of shared prosperity between state, private sector, and the frontline communities being asked to host vast renewable energy installations and transition mineral mines. This goes beyond traditional corporate social responsibility efforts and compensation for harms – long hallmarks of extractive industries – to direct benefit sharing mechanisms and initiatives, mandated by regulation. A number of countries in Africa have led the way, with governments and policy-makers embedding benefit-sharing models in laws governing both the mining and renewable energy sectors, from which states around the world – and perhaps particularly the Global South – can learn and take inspiration. The existence of such models is of critical importance. Evidence increasingly suggests the global energy shift currently risks veering dangerously off course from delivering a transition that is just and equitable. Across the renewable energy value chain, numerous instances of land and resource dispossession, displacement, livelihood destruction, community disintegration, criminalisation of leaders, and disempowerment of women and youth are surfacing, as documented by the Business & Human Rights Resource Centre’s (the Resource Centre) Transition Minerals Tracker, Just Transition Litigation Tracking Tool, and the Renewable Energy and Human Rights Benchmark. But a renewable energy value chain that respects and even promotes human rights through commitment to shared prosperity is possible, benefiting communities, companies and investors while enabling the urgent energy transition our planet needs. This briefing explores the relevant legislative frameworks from six African countries key to the global transition to renewable energy which seek to make mandatory private sector commitment to shared prosperity: Ghana, Kenya, Sierra Leone, South Africa, Tanzania and Zimbabwe. The frameworks span both mining and renewable energy, and include mechanisms such as community development agreements, community development funds and co-ownership agreements. Key takeaways: Clear frameworks for community benefit sharing in the mining and renewable energy sectors – which go beyond governments’ basic social and economic obligations – are essential. These should include clear requirements of the private sector, beyond voluntary corporate social responsibility initiatives. Governments should introduce regulatory interventions and make such benefit sharing mandatory, as well as monitor enforcement; Laws should require safe, inclusive community participation in all stages of a project, from conception to implementation, and ensure full integration of communities into governance structures and administrative procedures; Legal frameworks should be capable of ensuring that benefit-sharing arrangements are truly responsive to community needs, and able to confer material and other benefits, as defined by communities, including on women; Communities must have access to proper technical and financial support to create appropriate legal entities and negotiate meaningful benefit sharing agreements that truly address community needs; Legislative initiatives which enhance local land control are critical, such as Sierra Leone’s ground-breaking 2023 laws that enshrines the right to community consent in the context of industrial developments. Recognition of Indigenous Peoples’ right to free, prior and informed consent (FPIC) is an essential starting point where the projects are on or near Indigenous Peoples’ lands and territories. Impacts of the laws for communities in these countries highlighted in this analysis appear to vary. This demonstrates that even well-designed benefit-sharing frameworks can fail without proper enforcement. This requires capacitated and committed agencies, and transparency around revenues earmarked for local community development. There is also a need to define the role of traditional leaders in benefit sharing negotiations and engagements with the state and corporations and to guard against common risks like elite capture and misappropriation of funds. Nevertheless, these examples from the African continent demonstrate the potential of existing legislative frameworks – and others like them – to contribute to an energy transition that is genuinely equitable, sustainable, and just – in Africa and beyond. As national pledges to triple renewable capacity by the end of the decade encourage rapid renewable energy installation and buoy global demand for transition minerals, this is not a moment too soon. The recent launch of the UN Secretary-General’s Panel on Critical Energy Transition Minerals in April 2024 is instructive, with a goal to “develop a set of common and voluntary principles to build trust, guide the transition and accelerate the race to renewables,” while ensuring resource-rich countries and communities “benefit the most” from the extraction of transition minerals. Legislation that ensures the protection and empowerment of vulnerable populations and fosters shared prosperity can help ensure such outcomes.

Download Document