From Green to Red: New Energy Projects and Violent Conflict in Fragile Contexts

Abstract

Despite the ethical stance of new energy proponents, solar installations in emerging economies can be drivers of violent socio-political and socio-economic conflict in fragile contexts. This poses risks both to people and to successful implementation of a green transition. We first survey the pathways by which “green” energy investments can turn “red” through their entanglement in the political economy of conflict. We then empirically analyze the conflict impact of these projects using a geospatial dataset of projects in fragile contexts from 1994-2020. Employing propensity score panel matching in a subnational research design, we show that commercial-scale solar projects in fragile contexts, on average, cause an increase in deaths from conflict in the year following the project start in their local project area. Conflict escalation is driven by sentiment towards elites, underlining the propensity of these projects to undermine social cohesion. Given the ethical deficiency of outcomes that further burden the already poor and vulnerable, these results call for greater accountability for conflict risk assessment and mitigation by green financiers, the companies they fund, green energy advocates, and policy makers together embedded in a perhaps too-narrow view of the ethical landscape of the green transition.

Keywords: Environmental justice, conflict, green transition

JEL Classification: F23, F230, F350, O190