A Traveller's Notes

Just energy transitions are high on the international agenda. Are renewables the answer to just energy systems? Germany’s experience highlights how the political economy has shaped the Energiewende—its energy transition. Renewables offer an opportunity for inclusive clean energy. Social forces must advocate for them, lest they risk perpetuating political and energy power disparities.

The G7 hails its partnerships to support fossil fuel-dependent emerging markets switch in record time to clean energy while leaving no one behind (Kramer, 2022). South Africa, Indonesia, and further countries are therefore to receive billions of dollars by donors and banks that negotiate behind closed doors „who is paying what or how it will be spent“ (Lo, 2023). Capital justified through trickle-down economics, however, all too often remains detached from communities (Burke/Stephens, 2017; Bracking, 2019/2021).

Energy transitions take time and are inherently political (Fouquet, 2016; Smil, 2016). The concentration of power in the political and economic spheres often corresponds with the centralization of energy resources, and the converse holds true as well (Burke/Stephens, 2018; Mitchell, 2009). In contrast, “public ownership offers a chance for social struggles to build power able to transform our energy system and to reimagine carbon-free electricity as a public good“ (Luke/Huber, 2022: 1709). How transitions are implemented is important for achieving clean and inclusive energy. This calls for an inquiry into what makes for a widely shared, bottom-up approach to renewables (Roberts et al., 2018).

In this essay I examine how structural factors in the political economy shape renewables, drawing on lessons from Germany’s energy transition. Are renewables more inclusive—i.e., decentralised and egalitarian—than fossil fuels? The Energiewende suggests that they are. Here I argue that the economic and social order encouraged this. Where favourable conditions are not given, a more transformative approach may be required in the struggle for inclusive clean energy futures.

A Unique Opportunity: Achieving Energy Justice and Democracy

The need to shift from fossil fuels towards renewable energy sources to mitigate climate change represents a unique opportunity for the politicized goals of energy justice and democracy in the Global South and North. Energy justice advocates call for a fair distribution of the benefits and costs of energy systems in society. This encompasses distributive justice (equitable resource allocation), procedural justice (equitable decision-making), and justice as recognition (sociocultural fairness). As access to safe, reliable, and affordable energy is needed to ensure a living, energy poverty is deemed an injustice (Walker/Day, 2012; Sovacool et al., 2016; Christman/Russell, 2016; Jenkins et al., 2016; McCauley et al., 2019). Moreover, energy democracy advocates demand more distributed, participatory energy systems to empower communities and workers. They argue for a shift away from centralized, capitalist energy forms towards renewables as these allow for local planning, shared control, and public ownership, hence the democratisation of powers. Energy politics can thereby open up the transition to realize decentralized renewables (Sweeney, 2014; Thompson/Bazilian, 2014; Soutar/Mitchell, 2018; Luke/Huber, 2022).

To understand the basis for energy justice and democracy claims, one must deconstruct the complex relationship of energy systems and society (Burke/Stephens, 2018). First, centralization in energy systems and in political/economic power tends to be mutually reinforcing. Although there are some deviations in individual circumstances, the relationship broadly holds (Smil, 2004; Mitchell, 2009/2011; Malm, 2012; Laird, 2013). Second, renewables enable decentralized power, but need not. Renewables can be more flexibly dispersed for shared ownership and control compared to oil and gas which centralize power. They can still be centralized in megaprojects due to physical conditions, capital, regulation, know-how, competition, or system inertia. The outcome depends on the dynamics of energy politics. As the share of intermittent renewables increases, however, diverse power sources must be spread out over long distances to reconcile demand and supply, thereby engendering decentralized authority (Sovacool/Cooper, 2013). Third, not all renewables can be decentralized. Particularly wind and solar energy technology can be modularized and distributed. Hydroelectricity still tends to centralize control (Sovacool/Brossmann, 2013). Fourth, decentralized renewables allow community-led economic development, as shared ownership and control can contribute to equitable outcomes (Hoffman/High-Pippert, 2005; Delucchi/Jacobson, 2011; Gui/MacGill, 2018; Luke/Huber, 2022).

Overall, renewables co-evolve with shared political and economic power, while hydrocarbons tend to concentrate power. Where energy justice is sought, dominant power structures in centralized energy systems are contested. The destruction of fossil fuel regimes, however, brings with it challenges for capitalists and workers. If the political economy maintains power relations, renewables may reproduce or create new power imbalances between elites and marginalized groups (Geels, 2014; Burke/Stephens, 2017/2018; Newell, 2019; Sovacool/Brisbois, 2019). The way social forces partake in shaping transitions determines the clean energy future.

Shifting to Inclusive Clean Energy: A Neo-Gramscian Perspective

Shifts to renewables have increasingly attracted attention for how they are implemented, who stands to benefit or lose out. For a just energy transition to happen, frontline communities must be engaged in the process to contribute to, and benefit from, economic, social, and environmental outcomes (ILO, 2015; Winkler, 2018; Atteridge et al., 2019).

A Gramscian view of energy transitions can be useful to explicate the power structures and social forces involved in the change process (Winkler, 2020). In this sense, ideology serves as a means of uniting different interests for a common goal to achieve hegemony, i.e., power by persuasion. Through the practice of ideology, alliances strive for political leadership to challenge power structures and promote their vision. Accordingly, a just energy transition unites various actors to gain public support and achieve greater influence in society. Moreover, material conditions refer to the resources that a group controls to shape ideology, exercise hegemony, and cement power. Material conditions are characterized by inequalities in knowledge, income, means of production, technology, institutions, climate, and ecologies across class, race, gender, and identities. Hence, inequalities rationalize just energy transitions. Lastly, change agents, other players, and opponents reconfigure or exploit material conditions. For instance, labour unions may oppose shifts away from fossil fuels, while social movements can shift narratives. States possess institutional capacity for change, and businesses compete for dominance and alliances. International organizations can influence ideas, agendas, and conditions.

In this vein, a broad alliance of actors gathers around an ideology to assert societal hegemony for its energy future, mobilise support, and solidify or change the material conditions for its purpose. Because wind and solar power allows to reorganize and socialize resources, elites who gain from concentrated energy systems may undermine the energy transition. Likewise, diverse publics oppose a transition, if it amplifies inequalities (Hess, 2018; Prinz/Pegels, 2018; Sovacool/Brisbois, 2019; Winkler, 2020; Luke/Huber, 2022). Renewables must therefore be inclusive to garner enough public support for the transition to succeed.

Lessons From the Energiewende

The Energiewende—Germany’s commitment to a just energy transition—has been ongoing since the 1980s, being recognized as one of the most comprehensive initiatives to decarbonize a major economy (Morton/Müller, 2016). Despite challenges and politics of muddling through, a wide range of actors drove growth in non-hydro renewable energy technology initially supplied by home-grown manufacturers (Geels et al., 2017). As a result, electricity from renewables has increased from 20 TWh in 1990 to 254 TWh in 2022, among the highest levels in Europe, outstripping imported hydrocarbons, nuclear, and lately coal (AGEB, 2023). The presented framework helps to explicate key aspects of power in the transition to electricity from inclusive renewables.

The social market economy has provided the crucial stage for the Energiewende. The Federal Republic of Germany’s economic system developed after World War II as conceptual counterpart to market capitalism and socialism. The ideas of its architects have shaped political and economic life ever since. By conjoining market principles and social welfare, this paradigm differs from those of liberal market and centrally planned economies, thereby resembling a third way (Goldschmidt, 2004; Cetkovic/Buzogany, 2016). At its core is the commitment to sound competition, social safeguards, and a regulatory state that ensures both. At the same time, some authorities are decentralized across sixteen states (Moss et al., 2015; Kuzemko et al., 2016; Piskun et al., 2020). These features provide the fabric for the transition (Roberts et al., 2018).

Against this background, the Energiewende emerged as a new ideology that presents both a response to risks to the social market economy and an opportunity to expand on it. On one hand, the 1970s’ oil crisis and the 1986 Chernobyl and 2011 Fukushima accidents threatened the economic and social order at home by constraining or questioning reliable energy supply. These shocks gave impetus to R&D in renewables to find alternatives to energy security and to anti-nuclear movements that contested the technology’s safety. Green politics increasingly influenced public perception and policymaking, amplified by the (unresolved) dispute among federal states about nuclear waste disposal. After repeated attempts, in 2011, the opposition culminated in the exit from nuclear power by 2022 (Kungl, 2015; Morton/Müller, 2016; Geels et al., 2017). On the other hand, the prospect of clean energy provided new opportunities for innovation, entrepreneurship, business, and exports. This vision was used by state agencies to attract domestic and foreign investments in and by an industrious Mittelstand sector, the economy’s backbone (Quitzow/Thielges, 2022). The shutdown of outdated power plants in the former states of East Germany following the reunification in the 1990s gave way for new growth in this segment (Milbradt, 2020).

The Energiewende has been vital in reconciling environmental objectives and the social market economy under the banner of green growth. The growing global evidence about the adverse impacts of greenhouse gases on climate change since the 1990s undergirded the shift towards a low-carbon economy and ambitious emission reduction targets in Germany (Morton/Müller, 2016). The push for renewables challenged the power of the Big-4 private utilities as they rely heavily on imported gas/oil and coal. It also fuelled conflicts over the remaining coal mines, which are deeply rooted in the economic histories of eastern and western Germany (Geels et al., 2017; Weber/Cabras, 2017; Reitzenstein et al., 2021). Resistance to the coal phase-out underlined the need for a social framing of the transition in the public perception. In this vein, technological innovation coupled with structural subsidies in affected regions were crucial in strengthening hegemony. Decentralised renewables offered a promising “environmental industry”, albeit a contested one at times (Hillebrand, 2013: 666; Morton/Müller, 2016; Haas et al., 2022). Three groups of social forces stand out in the transition.

The Green Party played a significant role in shaping the Energiewende. The party utilized a broad-based social movement to institutionalize the opposition against nuclear power, which it framed as an outdated technology, and bring about the initial phase-out decision in 2002. It shuffled resources across departments, pushing for the introduction of incentives for renewables. It thus helped codify the new ideology in the 1991 Electricity Feed-In Law and the 2000 Renewable Energy Law, kick-starting the expansion of wind and solar power. Creating a market for inclusive renewables, regulations empowered prosumers and paved the way for public buy-in and know-how. The party’s policies have challenged and been challenged by power structures in the nuclear and carbon energy regime. But its advocacy for energy justice unlocked resources for grassroots development to make the case for the transition and gradually tilt popular and party support across the political spectrum in favour of it (Schreuers, 2012; Kuzemko et al., 2016; Geels et al., 2017).

Frontline workforce and incumbents impeded the Energiewende, resisting shifts in power. On one hand, coal mine shutdowns have alienated workers and caused fierce resistance from trade unions. In eastern Germany, where tens of thousands of miners lost their jobs, the workforce remains deeply sceptical. Unions pushed back against a coal levy, while plant operators secured new concessions. State representatives captured subsidies for structural development and retraining (Prinz/Pegels, 2018; Harrahill/Douglas, 2019; Saraste, 2020; Haas et al., 2022). On the other hand, the big utilities contested feed-in tariffs in court, lobbied officials to reverse the nuclear phase-out, and discursively framed renewables as unreliable and costly (Kungl, 2015; Geels et al., 2017). Moreover, affected communities and fossil capitalism targeted renewables’ weak spot: the grid. The former has vigorously protested new transmission lines required for widespread renewables. The latter, composed of naturally monopolistic transmission operators with historical ties to utilities, has been delaying the expansion of the electricity grid (Schmid et al., 2016).

Newcomers in renewables used institutional innovation and capital, leading the surge of renewables in electricity from 6% in 2000 to 43% by 2022 (OWID, 2023). Key conditions empowered a wide range of consumers, including municipalities, communities, homeowners, farmers, and businesses, to become partial energy producers. Individuals joined energy cooperatives to pool resources and generate electricity from renewable sources, resulting in around 800 newly founded community or rural energy cooperatives between the passing of the Renewable Energy Act and the revision of feed-in tariffs in 2014. These democratically governed vehicles allowed members to partake in decision-making and outcomes in local energy systems, representing an antidote to corporatist energy (Moss et al., 2015; Klagge/Meister, 2018). This was flanked by re-municipalization in the energy sector. Unsatisfied with the 1990s liberalization, many local and regional authorities restored public ownership in energy distribution, leading to municipal or state-run renewables since 2005. In fact, the late noughties saw home-grown manufacturers of renewable technology go bankrupt due to Chinese imports, compromising jobs and the ecological industry narrative (Geels et al., 2017). Still, cooperatives and public utilities continued to play a significant role in deploying renewables, utilizing the opportunity for decentralized, independent power. Moreover, these projects appropriated capital through the country’s network of public-minded banks. While cooperative banks supported energy cooperatives, state banks funded public utilities, providing concessional financing that small/medium-sized renewable energy projects require (Cumbers, 2016).

Implications for Inclusive Renewable Energy Futures

The Neo-Gramscian framework explicates the key social forces engaged in the power dynamics in Germany’s energy transition. These have paved the way for energy innovation, pushed back against change, socialized the burden for affected groups, undermined policies, or contributed to and benefited from the shift to wind and solar power. Energy politics for decentralized, bottom-up ownership has helped the transition gain public support, contributing to a market in renewables owned by diverse groups across the country while the Big-4 kept relying mostly on coal and gas/oil imports (Cetkovic/Buzogany, 2016). The Energiewende has thus resulted in inclusive renewables.

The framework, however, hardly problematizes the regressive social cost of this transition. German electricity costs are the highest in Europe. Households are charged a higher rate than industry. Compared to owners of renewables, less affluent tenants pay a premium on electricity, spending more of their income on energy (Weber/Cabras, 2017; Milbradt, 2020). This weakens distributive justice and equity in renewables compared to cheaply imported hydrocarbons. Others address this issue of losers in this transition applying multi-level perspective (Geels et al., 2017), and yet others analyse coal’s rigidity (Morton/Müller, 2016; Harrahill/Douglas, 2019; Haas et al., 2022), and incumbent behaviours beyond the scope of this essay (Kungl, 2015; Schmid et al., 2016; Prinz/Pegels, 2018).

Without attempting to generalize statements about transitions or geopolitics in renewables (cf. Lachapelle et al., 2017; Meckling/Hughes, 2018; Feola, 2020), the following implications stand out for countries striving for inclusive clean energy. First, Germans chose their destiny. The direction and means in energy politicshave been subject to lengthy, contested political processes inclusive of change agents and social movements. Given global climate negotiations, emerging markets find themselves under pressure from international powers. Weak forms of political participation, however, may replicate power imbalances in a renewable energy regime and impede the transition (Burke/Stephens, 2018).

Second, decentralised renewables enabled the Energiewende. Wind and solar power have been modularized, distributed, and ownership in them shared compared to imported hydrocarbons, localized coal, and concentrated nuclear power. Germany’s renewable energy future gained enough public buy-in for the transition to become nationally important; for coal-reliant communities (having) to appropriate support while fossil capitalism is being fought. Emerging markets are confronted with tough choices in shifting to clean energy. State-sponsored oil and gas impedes phase-outs. Hydropower constrains decentralisation. Yet, energy politics that offer communities ways to build ownership/know-how in energy technology can reduce distributive, procedural, or sociocultural injustices (Mitchell, 2011; Burke/Stephens, 2018).

Third, the social market economy provided the foundations for a just energy transition to take hold in Germany. The political-economic environment set the boundaries for the interpretative framework of the Energiewende as well as the policies (tariffs, taxes, aid) and institutional capacities (know-how, capital, autonomy) that enabled this transition to unfold the way it did including the changes to production and power relations. However, in places where elites benefiting from concentrated energy systems can co-opt energy politics in favour of incremental adjustments, fundamental paradigmatic transformations may be a pre-requisite for inclusive renewables (Newell, 2019; Osicka/Cernoch, 2022).

Conclusion

Renewables have the potential to be more decentralised and egalitarian than hydrocarbons. Wind and solar energy co-evolve with shared political and economic power, while oil and gas tend to concentrate power. Germany’s energy transition serves as an example for how the political economy can shape renewable energy, and how favourable conditions can encourage the realization of inclusive renewables to achieve to a greater extent energy justice and democracy.

Threats to and opportunities in the social market economy gave rise to the Energiewende as a new ideology. Advocates of energy justice and grassroots movements contested legacy power structures and exercised hegemony, re-configuring conditions in energy politics. Conducive regulation, decentralized authority, institutional capacity, and inclusive capital encouraged widespread buy-in, production, and popular deployment of renewables across the country.

The achievement of inclusive, clean energy depends on how transitions are implemented. Where favourable conditions are not given, publics may have to take transformative approaches to achieve energy justice, lest energy politics may replicate power imbalances and injustices in centralized wind, solar, hydro, let alone nuclear power. Renewables offer an opportunity for inclusive energy. Social forces must realize them. Weinberg (1990) and Burke/Stephens (2018) raise an underlying question which remains for another day: Can energy technology make, or break, democracies?

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