Abstract
This volume is very timely, as energy and climate law literature have been developing in parallel, without much integration, leaving a gap in the analysis of regulatory interventions needed to decarbonise energy systems while maintaining the security of supply. Energy law, as a relatively young discipline, is still in the search of a holistic and balanced approach, taking into account the context in which energy regulation exists and operates: justice and equity considerations, environmental concerns, technological constraints and breakthroughs. Energy law scholarship is for the most part split into silos of oil and gas lawyers, renewable energy lawyers, networks and utilities lawyers. This book is an important step towards integration and maturing of the discipline.
The book is in two parts, firstly focusing on energy security in the era of decarbonisation (chapters 1–9) and secondly, case studies in energy transition from various countries and regions (chapters 10–16).
Most chapters in part 1 centre on private rights and the energy industry, highlighting that ‘governance cannot be monolithic’ (p. 124) and must involve private actors in a meaningful way. Protections accorded to energy industry actors by international investment law have been both the catalyst and the hurdle to decarbonisation. On the one hand, instruments like the Energy Charter Treaty are often used to protect renewable energy producers from subsidies rollbacks; on the other, fossil fuel investors use investment law to bring lawsuits against governments’ decarbonisation actions that might amount to expropriation. This debate is the central topic of chapter 6, which concludes that investment law should be reformed to provide ‘greater transparency’ (p. 174) to investors on States’ energy and climate policies and to introduce appropriate compensation to both investors and the affected communities. The role of the oil and gas industry in climate change governance and decarbonisation, discussed in chapter 8, is important and controversial – climate treaties do not impose obligations on private actors, but the industry’s influence on governments around the world is strong and ongoing. Finally, chapter 9 provides a critical analysis of carbon taxation, arguing that the market alone cannot be effective in decarbonising the energy supply and ‘there is no way to avoid a more interventionist approach to the climate crisis’ (p. 241).
The chapters in part 2 meaningfully build on the foundation of part 1 by focusing on specific jurisdictions. Analysis in these chapters brings forward the often-conflicting policy objectives of climate and energy regulation, common to all case studies whether they are ‘resource-rich developing countries’ (p. 3) or developed economies. The former understandably prioritise energy security over climate considerations, evident from analysis in chapters 13 and 16 on energy law in Nigeria and Southern Africa, respectively. At the same time, it is clear that despite the common challenge of providing access to energy, the hurdles faced by developing economies in the energy sector are not homogenous and require tailored regulatory approaches. For example, in resource-rich Nigeria, the main challenges ahead lie in recovering costs through tariffs while keeping electricity affordable and stimulating investments in off-grid solutions. In Zambia, heavily reliant on hydropower, one of the main energy supply problems lies in the reduced water levels caused by climate change (p. 399), not an issue easily solved by better market regulation.
The regulatory challenges arising in the economically developed jurisdictions are highly politicised and are often exacerbated by the need to integrate intermittent renewables in the existing centralised grid infrastructure. The chapters centred on the USA (1, 2, 3, 4 and 10) are particularly relevant in light of the Texas grid crisis winter 2020–21, largely blamed on the growing wind energy supply and the particular regulatory set-up. The electricity regulation in the USA comprises federal and State-level laws and institutions, with the Texas electricity grid operating and being governed separately from the rest of the country. Ensuring the security of supply, grid stability and the ever-evolving energy mix is not aided by such a multilevel governance approach. Chapter 3 examines technology-based solutions to maintaining grid stability amidst an increasing renewables share in the energy supply, such as power-to-gas and renewable natural gas. Chapters 2 and 4 turn to gas, analysing the legislation on natural gas and greenhouse gas emissions in the USA and providing a case study on gas flaring in Texas. A common thread in these chapters centred on the USA is the significant influence of political hyperpolarisation on energy and climate decision-making, often blocking federal-level initiatives like the Green New Deal. This situation, however, gives way to the rise of bottom-up initiatives such as city-level renewable energy commitments, perhaps especially suitable in the context of the USA due to the fragmented energy decarbonisation ambition across the country. The lack of political will to integrate climate and energy policies is further exposed in chapters 14 and 15 focusing on Australia and Canada, respectively. In Australia, the recent drought and bushfire crisis have exposed the inefficient approaches to energy transition in the country, while in Canada, project approvals for energy infrastructure struggle with ‘“proxy clashes” on broader environmental and social concerns, including climate change’ (p. 376). In contrast, the 2018 European Union Clean Energy Package, building on earlier market liberalisation reforms, is now focused on developing a more decentralised power system, capable of integrating active consumers, sector-coupling and storage solutions (chapter 11).
The book’s structure is not always clear as some chapters in part 1 read more like country case studies belonging in part 2. There is, therefore, overlap between chapters (e.g. chapters 2 and 3, 1 and 10) especially in the introductory sections, which could easily have been avoided. The final chapter provides a summary of the book but could have gone into more depth to elaborate on the integrated ‘law in context’ approach in climate and energy. That said, none of these minor shortcomings would present an obstacle to readers interested in separate chapters, which are individually very well-developed.
Chapters in this book will be of relevance to energy and climate law academics, policymakers and practitioners. This text would be a great asset to the university libraries and should be integrated into energy law study programmes. The unique value of this volume is its contribution to contextualising energy law and policy apropos of climate change, technological opportunities and constraints and specific regional challenges. The editors and the diverse team of authors have started an important and long-overdue discussion on integrated climate-energy regulation, which will undoubtedly spur further research and inform policy.