Social Europe

politics, economy and employment & labour

  • Themes
    • Strategic autonomy
    • War in Ukraine
    • European digital sphere
    • Recovery and resilience
  • Publications
    • Books
    • Dossiers
    • Occasional Papers
    • Research Essays
    • Brexit Paper Series
  • Podcast
  • Videos
  • Newsletter

Municipalities can overcome Europe’s fossil-fuel addiction

Lavinia Steinfort and Andrew Cumbers 2nd September 2022

Europe’s municipalities are developing social and ecological solutions to the energy crisis. They need more power to their elbows.

municipalities,local authorities,energy,fossil fuel,renewable
Ghent in Belgium has a municipal hub offering citizens energy advice and free home audits (Michael Schmalenstroer CC BY-SA 3.0)

Europe’s fossil-fuel addiction is painfully clear amid the global energy crisis and the unfolding horrors in Ukraine. Yet municipalities across the continent have great potential to tackle climate change and energy dependencies. Using this potential will however require funds, power and know-how—to put the interests of residents over corporate revenues. 

In response to inaction by their national governments, progressive European municipalities have been making the most of their limited powers and resources to further a fair, clean and democratic energy transition. Evidence of municipal practices gathered by the mPOWER project, which has been facilitating peer learning among more than 100 European local authorities, shows that towns and cities have been developing successful forms of co-operation with residents.

From east to west, north to south, such collaborations have pursued the retrofitting of public buildings and private apartments, resulting in reduced emissions and lower energy bills, combating energy poverty. With local-authority support, citizens have been creating hundreds, if not thousands, of community energy schemes, greatly increasing local renewable power production. The bolder municipalities have even embarked upon more democratic models of ownership and governance, sharing decision-making powers with citizens.

Massive constraints

In many countries, however, municipalities face massive constraints, lacking the finance and competences to deliver the scale of energy transition required of them, especially in pursuing fairer and more genuinely sustainable outcomes. So much more could be achieved with fuller devolution of power and resources from national government to local authorities and communities.


Our job is keeping you informed!


Subscribe to our free newsletter and stay up to date with the latest Social Europe content. We will never send you spam and you can unsubscribe anytime.

Sign up here

Towns and cities are well positioned to retrofit their entire building stocks and ensure energy neutrality for new buildings. To urgently wean us off our fossil-fuel heating dependencies—by far the most critical remaining issue for tackling the continent’s climate-change ambitions—the muncipal scale is the most apt in developing environmentally-sustainable, heating (and cooling) solutions. Municipalities are best placed to prioritise and maximise proximate power generation for essential use in homes and local public services.

The transition would proceed much more quickly, though, if local authorities had the necessary data—much of which is privately owned and controlled—for better energy-reduction strategies. To apply such capacities effectively, local governments need to end their dependence on big business and ‘liberalised’ energy markets. Downsizing and the privatisation of the assets, infrastructures and capacities needed to deliver integrated public action on transition have hindered the ability of municipalities to take a lead on climate change.

A lack of human and financial resources leads to public administrations turning to big business for producing, distributing and supplying renewable energy, with an attendant loss of revenues to satisfy corporate profits, instead of developing this expertise in-house. Such private leakages further impede the rapid transition needed to face the climate emergency, as well as feeding some of the biggest culprits hindering the transition, through their vested interests in fossil fuels.

Monopoly powers

The city of Amsterdam, for example, relies on the Swedish multinational, Vattenfall, for much of its heating needs, despite the latter’s use of its monopoly powers to overrule environmentally-friendly local heating solutions, such as aqua thermal, to advance its own, fossil-based heating service. Moreover, the city council appears blind to the true cost of the private partnership with the multinational.

On the national level we know that in recent years Vattenfall’s domestic renewable-energy production has almost halved, even though the company received over half a billion euro in subsidies from the Dutch government. Without this aid, the company could never have made €387 million in profits and paid out €1.183 billion in dividends to its shareholders in 2015-20. If the public had been in control, that money could have been reinvested to speed up a socially-just transition. 

While large corporations make money for their shareholders, public authorities are supposed to act in the interests of the wider population. Renewable-energy power purchase agreements (PPAs)—conventionally fixed-rate, long-term contracts involving a government body and a big private utility—are an expression of this tension. Local as well as larger authorities end up shouldering the system costs and guaranteeing profits for the corporation. Under the pretext of competition, the latter tends to elbow out small citizen initiatives and refrain from sharing any expertise with public authorities, to maintain its ‘competitive advantage’—even though its technical know-how should be publicly available for the energy transition to take off more comprehensively.

Local action

That’s why public funds—whether in the framework of the European Green Deal, Covid-19 relief or the accelerating energy crisis—should not be subsidising the profits of big corporations, as currently, but benefiting the population directly. To this end, public bodies and forms of ownership, in all their variety, need priority funding. On top of that, a substantial amount should be earmarked for locally-responsive action on climate and the energy transition.

With proper support from national and European institutions, municipalities across the continent can ensure productive policy co-ordination tackling social and environmental concerns. By interlinking action on energy poverty, air pollution and emissions, for example, cities can become healthier places to live, in particular for members of poor and minority-ethnic communities.


We need your support


Social Europe is an independent publisher and we believe in freely available content. For this model to be sustainable, however, we depend on the solidarity of our readers. Become a Social Europe member for less than 5 Euro per month and help us produce more articles, podcasts and videos. Thank you very much for your support!

Become a Social Europe Member

Yet funding for the transition is likely to fall short if the European Union continues to bet on a liberalised energy market. A growing body of research is showing that the more governments liberalise the power sector, the more subsidies are needed to increase the amount of renewables in the electricity mix. Yet, as a result of these subsidies, wholesale energy prices went down in recent years—and with that private investments in renewables, because of reduced profitability. Pricing is evidently an inadequate mechanism to steer the transition.

Public emergency

With only eight years left to limit planetary heating to 1.5C above pre-industrial levels and many more millions on the brink of energy poverty, the EU cannot leave decarbonisation to an ever-more-volatile market. Instead, it needs to treat the energy transition as a public emergency, requiring integrated strategic planning. This requires European institutions to bury market ideology and enable member states to team up with their municipalities and citizens, to publicly plan, own and run an energy system in transition.

In the meantime and in response to asymmetrical PPAs, a growing number of European municipalities have started to take energy-efficiency measures and renewable energy into their own hands. What’s more, across the continent, towns and cities are increasingly eager to learn from, and work with, each other.

Such municipal partnerships can help sideline the market competition which undercuts much-needed government co-ordination, promoting instead collaboration among public powers to tackle the climate crisis. In this way, the EU might actually overcome its long-lingering addiction to fossil fuels.

Lavinia Steinfort
Lavinia Steinfort

Lavinia Steinfort is a political geographer and activist. At the Transnational Institute she works on public alternatives such as (re)municipalisation of public services, a just transition towards energy democracy and transforming finance for the 99 per cent.

Andrdew Cumbers
Andrew Cumbers

Andrew Cumbers is professor in regional political economy at the Adam Smith Business School in Glasgow. Previously, he worked at the universities of Durham, Middlesex and Aberdeen as a researcher and lecturer on labour and economic geography.

You are here: Home / Ecology / Municipalities can overcome Europe’s fossil-fuel addiction

Most Popular Posts

Russian soldiers' mothers,war,Ukraine The Ukraine war and Russian soldiers’ mothersJennifer Mathers and Natasha Danilova
IGU,documents,International Gas Union,lobby,lobbying,sustainable finance taxonomy,green gas,EU,COP ‘Gaslighting’ Europe on fossil fuelsFaye Holder
Schengen,Fortress Europe,Romania,Bulgaria Romania and Bulgaria stuck in EU’s second tierMagdalena Ulceluse
income inequality,inequality,Gini,1 per cent,elephant chart,elephant Global income inequality: time to revise the elephantBranko Milanovic
Orbán,Hungary,Russia,Putin,sanctions,European Union,EU,European Parliament,commission,funds,funding Time to confront Europe’s rogue state—HungaryStephen Pogány

Most Recent Posts

reality check,EU foreign policy,Russia Russia’s invasion of Ukraine—a reality check for the EUHeidi Mauer, Richard Whitman and Nicholas Wright
permanent EU investment fund,Recovery and Resilience Facility,public investment,RRF Towards a permanent EU investment fundPhilipp Heimberger and Andreas Lichtenberger
sustainability,SDGs,Finland Embedding sustainability in a government programmeJohanna Juselius
social dialogue,social partners Social dialogue must be at the heart of Europe’s futureClaes-Mikael Ståhl
Jacinda Ardern,women,leadership,New Zealand What it means when Jacinda Ardern calls timePeter Davis

Other Social Europe Publications

front cover scaled Towards a social-democratic century?
Cover e1655225066994 National recovery and resilience plans
Untitled design The transatlantic relationship
Women Corona e1631700896969 500 Women and the coronavirus crisis
sere12 1 RE No. 12: Why No Economic Democracy in Sweden?

Foundation for European Progressive Studies Advertisement

The winter issue of the Progressive Post magazine from FEPS is out!

The sequence of recent catastrophes has thrust new words into our vocabulary—'polycrisis', for example, even 'permacrisis'. These challenges have multiple origins, reinforce each other and cannot be tackled individually. But could they also be opportunities for the EU?

This issue offers compelling analyses on the European health union, multilateralism and international co-operation, the state of the union, political alternatives to the narrative imposed by the right and much more!


DOWNLOAD HERE

Hans Böckler Stiftung Advertisement

The macroeconomic effects of re-applying the EU fiscal rules

Against the background of the European Commission's reform plans for the Stability and Growth Pact (SGP), this policy brief uses the macroeconometric multi-country model NiGEM to simulate the macroeconomic implications of the most relevant reform options from 2024 onwards. Next to a return to the existing and unreformed rules, the most prominent options include an expenditure rule linked to a debt anchor.

Our results for the euro area and its four biggest economies—France, Italy, Germany and Spain—indicate that returning to the rules of the SGP would lead to severe cuts in public spending, particularly if the SGP rules were interpreted as in the past. A more flexible interpretation would only somewhat ease the fiscal-adjustment burden. An expenditure rule along the lines of the European Fiscal Board would, however, not necessarily alleviate that burden in and of itself.

Our simulations show great care must be taken to specify the expenditure rule, such that fiscal consolidation is achieved in a growth-friendly way. Raising the debt ceiling to 90 per cent of gross domestic product and applying less demanding fiscal adjustments, as proposed by the IMK, would go a long way.


DOWNLOAD HERE

ILO advertisement

Global Wage Report 2022-23: The impact of inflation and COVID-19 on wages and purchasing power

The International Labour Organization's Global Wage Report is a key reference on wages and wage inequality for the academic community and policy-makers around the world.

This eighth edition of the report, The Impact of inflation and COVID-19 on wages and purchasing power, examines the evolution of real wages, giving a unique picture of wage trends globally and by region. The report includes evidence on how wages have evolved through the COVID-19 crisis as well as how the current inflationary context is biting into real wage growth in most regions of the world. The report shows that for the first time in the 21st century real wage growth has fallen to negative values while, at the same time, the gap between real productivity growth and real wage growth continues to widen.

The report analysis the evolution of the real total wage bill from 2019 to 2022 to show how its different components—employment, nominal wages and inflation—have changed during the COVID-19 crisis and, more recently, during the cost-of-living crisis. The decomposition of the total wage bill, and its evolution, is shown for all wage employees and distinguishes between women and men. The report also looks at changes in wage inequality and the gender pay gap to reveal how COVID-19 may have contributed to increasing income inequality in different regions of the world. Together, the empirical evidence in the report becomes the backbone of a policy discussion that could play a key role in a human-centred recovery from the different ongoing crises.


DOWNLOAD HERE

ETUI advertisement

The EU recovery strategy: a blueprint for a more Social Europe or a house of cards?

This new ETUI paper explores the European Union recovery strategy, with a focus on its potentially transformative aspects vis-à-vis European integration and its implications for the social dimension of the EU’s socio-economic governance. In particular, it reflects on whether the agreed measures provide sufficient safeguards against the spectre of austerity and whether these constitute steps away from treating social and labour policies as mere ‘variables’ of economic growth.


DOWNLOAD HERE

Eurofound advertisement

Eurofound webinar: Making telework work for everyone

Since 2020 more European workers and managers have enjoyed greater flexibility and autonomy in work and are reporting their preference for hybrid working. Also driven by technological developments and structural changes in employment, organisations are now integrating telework more permanently into their workplace.

To reflect on these shifts, on 6 December Eurofound researchers Oscar Vargas and John Hurley explored the challenges and opportunities of the surge in telework, as well as the overall growth of telework and teleworkable jobs in the EU and what this means for workers, managers, companies and policymakers.


WATCH THE WEBINAR HERE

About Social Europe

Our Mission

Article Submission

Membership

Advertisements

Legal Disclosure

Privacy Policy

Copyright

Social Europe ISSN 2628-7641

Social Europe Archives

Search Social Europe

Themes Archive

Politics Archive

Economy Archive

Society Archive

Ecology Archive

Follow us

RSS Feed

Follow us on Facebook

Follow us on Twitter

Follow us on LinkedIn

Follow us on YouTube