Procurement, finance and the energy transition: between global processes and territorial realities

Utility-scale renewable electricity generation is essential to decarbonisation as well as to ensuring affordable and secure electricity supplies around the world. Yet thus far there has been limited critical thinking dedicated to the complexities behind the finance and ownership of this new infrastructure and how national and local stakeholders should participate in and benefit from its development, particularly in contexts of high inequality in low- and middle-income countries. As the global renewable energy industry becomes increasingly consolidated and financialised, evidence from a number of countries suggests that despite the pro-environmental outcomes of utility-scale renewable electricity generation, the processes and institutions that procure and finance it have often failed to include or benefit individuals and communities living in the national and local vicinity. This paper therefore sets two key competing objectives of renewable electricity generation in context: as a predictable, long-term revenue stream for investors, and as a mechanism for socio-economic development and community empowerment. Building on scholarship from human geography, development studies and sustainability transitions, my analysis takes forward understandings of the role of finance in utility-scale renewable electricity generation as a key aspect of the political economy of the energy transition. In exploring the evolution of renewable electricity as a new and rapidly emerging asset class I consider how its development is increasingly determined by the frameworks and logics of finance and investment. Drawing on examples from South Africa and Mexico, I address the following questions: What are the evolving configurations and processes of finance and investment in utility-scale renewable electricity generation? How have they been facilitated? And what tensions have arisen from their implementation at the national and local level?