Many assume that big publicly traded oil companies and private individuals are primarily responsible for climate change. And there is some truth to this assumption.
Chevron, ExxonMobil, Shell and other fossil fuel companies .
But, a few individuals also play a disproportionate role in global emissions. . This figure is roughly the same as .
Governments have responded to the problem of private emissions through a variety of . However, what is often overlooked is that governments own some major emitters themselves.
State-caused pollution is often neglected
Numerous state-owned energy companies and utilities rank among the world’s biggest polluters.
Despite recent , Saudi Arabia still owns 98 per cent of Saudi Aramco Oil Group. Russia holds a majority stake in the multinational energy corporation, Gazprom. .
Many other governments maintain major stakes in fossil fuel companies, including .
According to climate researcher Richard Heede’s groundbreaking study, . In 2017, reported that government-owned enterprises accounted for 59 per cent of the so-called carbon majors’ emissions. The carbon majors are the highest emitting companies dating back to the 1850s.
State-caused pollution can also result from unexpected sources. Military operations, for example, . For reference, the aviation and shipping industries roughly account for two per cent of global emissions each.
State-caused pollution is different
State-caused pollution presents both a problem and an opportunity.
State-caused pollution is inconsistent with the principles of international climate change law. As the International Court of Justice has confirmed, governments are required to prevent transboundary environmental harm resulting from the activities under their “,” which includes state entities.
The Paris Agreement calls on governments to enact climate change mitigation efforts that reflect their “.” The UN notes:
“States should … refrain from unlawfully polluting air, water and soil, e.g. through industrial waste from State-owned facilities.”
These norms suggest that states should do more to lower their emissions.
At the same time, state-caused pollution is easier to control through the political process. In contrast to privately-owned companies, state-owned polluters are directly accountable to government officials.
This implies that their activities are primarily shaped by , as opposed to the overriding goal of profit maximization. This distinction opens interesting avenues for climate change action, provided governments make it a priority to reduce their emissions.
Addressing state-caused pollution
State emission sources can be controlled in two ways.
First, voters can urge governments to speed up the transition to cleaner energy through state-owned enterprises. Starting in 2003, the Ontario government closed five state-owned coal-fired power plants. The closures slashed coal’s share of the province’s electricity generation mix .
In October 2022, the French government to renationalize the country’s national utility, Électricité de France. This initiative contributes to .
In both these examples, to pursue significant changes in their economy’s energy supplies.
Second, national and international courts can hold state-owned polluters accountable for environmental harms. There is an emerging trend of climate change claims against state-owned polluters, or so-called .
In the , the African Commission on Human Rights found the Nigerian government responsible for human rights violations resulting from the polluting activities of its government-owned oil company.
Similarly, an recently found the country liable for constitutional violations resulting from
In , climate activists have launched lawsuits against government financial institutions for their investments in the fossil fuel industry. This trend of “state-as-polluter” will likely continue in the future.
A new era for state-owned polluters?
Historically, state-owned energy companies played an important role in pursuing political objectives. During the Cold War, .
State-owned energy companies in many countries continue to provide a reliable source of energy for domestic consumers.
The mission of state-owned energy companies will need to change in the climate change era.
Indeed, . To address this challenge, governments can leverage their control over state-owned companies to divest from the fossil fuel industry and lower their emissions.
State-owned companies can also make major investments in renewable energy sources and research and development. This will allow state-owned companies to play a decisive role in the clean energy transition.
Steve Lorteau receives funding from the Social Sciences and Humanities Research Council.
