Sustainable Energy Infrastructure: Law, Policy and Practice

Author:Dr Priscilla Schwartz
Position:Lecturer in Law University of Leicester

This paper focuses on the complex relationships and some of the tensions in reconciling economic, social, and environmental goals as necessary for achieving sustainable energy infrastructure development in developing countries. It introduces the rationale of sustainable development, and uses examples to demonstrates that reconciling the three dimensions to achieve sustainable energy... (see full summary)


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1. Introduction

The concept of sustainable development is rooted in the ideology of introducing change in the way states and businesses exploit natural resources in production processes for economic purposes. The 1972 Stockholm Declaration (Stockholm), identified a common outlook and link between resource exploitation for development and environmental protection. Then Brundtland Report popularised the phrase 'sustainable development' and officially define it to mean 'development that meets the needs of the present without compromising the ability of the future generations to meet their own needs' (WCED 1887 p.43). The concept was later adopted by nations through the Rio Declaration and Agenda 21, and it was anointed formally for legal use within the corpus of international environmental law (Sands 1992). The Johannesburg WSSD reinstated commitment from world leaders to advancing the goals of sustainable development at the national, regional and global levels, with emphasis on social and economic development and the regulation of corporate activities through transparent regulations, international initiatives and public-private partnerships.

The Stockholm, Rio and Johannesburg Declarations and related implementation documents (Agenda 21 and Johannesburg Plan of Implementation) prescribed principles for legal and policy guidance in environment and development matters. These include:

* the principle of environmental protection which has an economic and social component by which, protection evinces as right to utilize environmental resources in production processes to meet the needs of mankind, but with consideration for the limits of nature (Stockholm 1; Rio 1).

* The integration principle requires a coordinated approach to environmental and development issues (Rio 3, 4).

* Inter and intra generational principles speak to equity in terms of allocation of resources, and fairness in the formulation and application of laws regulating economic activities (Stock.1, 2; Rio 3, 6).

* Sustainable utilisation advocates prudent use of resources in production and consumption (Stock. 2; Rio 8).

* The polluter-pays principle ensures that polluters bear the cost of polluting activities through sound regulatory framework, economic mechanisms, and liability and compensation regimes (Stock.22; Rio13 & 16).

* Precautionary principle aims to mitigate environmental threats and damage by recommending planning and adopting cost effective measures. (Rio 15)

* Environmental Impact Assessment (EIA) canvasses the need to weigh environmental, economic, and social concerns in deciding whether to allow a project to go on. (Rio 17)

* Principle of participation aims to improve the level of public participation in environmental decision-making through provision of environmental information and access to administrative and judicial remedy (Rio 10).

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* Corporate accountability principle seeks to make corporations responsible for their environmental and social wrongs through law, voluntary initiatives and Public Private Partnerships (Rio 16; Johannesburg Declaration).* The principle of cooperation requires states to cooperate to promote a supportive and open international economic system that will lead to economic growth and sustainable development in all countries to address the problems of environmental degradation. (Rio 12).

States, international institutions, and businesses should cooperate through multilateral and bilateral agreements to formulate and apply policies, guidelines and best practice to promote environmental friendly economic activities (Stock. 24/25; Rio 12 and 27; see also Agenda 21, paragraph 30:2 and 10).

The forgoing principles of sustainable development speak to a development-oriented view from the perspective of regulating development activities in terms of economic viability, social acceptability, and environmental soundness. In this context, 'sustainable development' represents primarily as a principle in international environmental law aimed at reconciling ideological barriers between environmental protection and economic development imperatives by advocating a regulatory framework that should inform and guide development projects. This perspective of sustainable development for regulating environmental and socially sound economic activities is distinct from articulations of a wider development strategy of countries. In the wider context, sustainability represents value judgement on countries' level of development and is usually in relation to other international law benchmarks like poverty, human rights, democracy, population, education and conflicts. The reference to sustainable development in this paper is not concerned with this wider paradigm. Instead, the analysis will concern the former in terms of regulating energy infrastructure projects and service delivery in developing countries, in a manner and by a process that aims to accommodate the varied, competing, but complimentary interests in undertaking energy projects. Energy infrastructure herein refers to electricity, in context of investment in power plants, sales, revenue and prices, generation, trade, demand, and plant emissions. It also covers energy use in households, commercial buildings, manufacturing, and transportation on the one hand and to fuel use, including renewable and alternative fuels (e.g. hydropower, solar etc.). It precludes discuss of Petroleum energy, Natural gas and Coal.

The analysis on regulating energy infrastructure for environmental and socially acceptable economic activities serves to highlight the competing economic, social, and environmental goals inherent in energy projects. This imperative underscores the legal significance of sustainable development. The application of its principles to regulate energy projects for sustainability will thus depend on the following:

* the nature of electricity venture sought to be undertaken-, power plants, hydropower, Nuclear, etc.

* who commissions, undertakes or underwrites the project - whether, public, private or donor sponsored investment* the nature and extent of use of natural resources - land, air, wind or water

* the distribution of benefits/profits acquired from electricity projects- Tax revenues, dividends, community development funds; and* the responsibilities of various entities in energy development, vis-à-vis the redress of those negatively affected by it.

Sustainability here symbolises a continuous and ongoing process of change and adaptation in which, resource exploitation, investments, technology and institutional change relate in harmony to enhance current and future needs and aspirations (Lindner 1991). The process engenders an intricate and complex net work of rights, obligations and other socio-legal relationship that transcends traditional legal models. The paper provides an overview of the economic, social and environmental aspects of sustainable energy infrastructure in developing countries. It uses examples to demonstrates that reconciling the three dimensions to achieve sustainable energy infrastructure engenders intricate legal relationships and interests that require a reorientation in our appreciation of law and policy beyond traditional models. It also provides a general overview of some relevant legal sources and attributes that form the legal framework for balancing these competing goals and recommends a regulatory model that is best for achieving sustainable energy in developing countries.

2. Issues of sustainability in energy infrastructure

Electricity is crucial for enhancing industrialisation, trade and consequently stimulating economic development. However, electricity infrastructure remains inadequate in least developed countries (LDCs), particularly in Africa. According to the World Bank, the need for access to good quality, reliable and affordable infrastructure is universal in developing countries but the nature of the infrastructure 'gap' varies. The gap in LDCs in sub-SaharanPage 109 Africa relate to demand for increased access to basic infrastructure services in addition to improving service quality and efficient service delivery (World Bank 2005).

Electricity infrastructure thus has imperatives for development from an economic, social, and environmental viewpoint and present sustainability issues which tend to undermine or conflict with the development needs it aims to address. In order to reflect an adequate context of sustainable energy infrastructure this paper will analyse the value of electricity in relation to the three dimensions of sustainable development - economic, social, and environmental, as essential in the process of addressing the needs of humankind. It will also identify the roles of various actors and stakeholders, including the challenges presented by the interactions, tradeoffs and complementarities inherent in energy sector investment, energy resource development, supply policy, consumption and demand management, and institutional development.

2. 1 Economic, social and environmental aspects of energy sustainability

The main thrust of economic aspects of sustainable energy development is the promotion of growth of the countries' economies through business. At a country specific level, such as Ghana and Sierra Leone, energy policy objective seek to maintain adequate and reliable energy supply, reduce energy intensity in creation of economic growth, achieve high levels of end-use efficiency and to...

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