Solar industry must act urgently to address concerns about modern slavery in its supply chain, new report argues

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New report from the University of Nottingham’s Rights Lab, ‘The Energy of Freedom’?: Solar energy, modern slavery and the Just Transition’, warns that the rapid increase in demand for solar energy risks fuelling demand for products made with forced labour, including the polysilicon used in solar panels and cobalt used in lithium-ion batteries.

The report takes its title from a comment by the German finance minister, Christian Lindner, who described renewables as ‘the energy of freedom’ and said they could aid energy security in response to the war in Ukraine. As governments move to free themselves from Russian fossil fuels, demand for solar power is set to grow massively.

Professor James Cockayne, lead author of the study, commented: “The solar energy sector urgently needs a ‘roadmap’ to address modern slavery risks if it is to be seen as ‘the energy of freedom’.

“The industry needs a clear plan to transition rapidly to slavery-free supply-chains, or those buying ‘slavery-free’ solar may simply end up cross-subsidizing slave-made solar energy sold by the same suppliers to other customers.

“Whether solar energy will prove to be ‘the energy of freedom’ for consumers alone, or also for workers and producer communities, is yet to be decided.”

The Energy of Freedom’? identifies a shift from policies aimed at enforcing labour rights to approaches focused more narrowly on increasing ‘slavery-free’ production capacity.

According to the researchers, this risks a split in the global market, with one supply chain providing ‘slavery-free’ solar products to clients who want them and another serving others.

That split, the report argues, will not only do little to help enslaved people who make polysilicon and mine cobalt, but will also raise costs, reduce innovation and slow the transition to renewable energy.

The report calls for new, collaborative approaches to estimate and manage these risks as they cascade down the energy value-chain.

It sets out a new way of estimating the forced labour risk per kilowatt hour of solar energy that a country produces, accounting for all the risks earlier in the value-chain.

This is set to help solar energy stakeholders better identify and manage these risks and could help regulators and investors create benchmarks and risk thresholds, for example by restricting public contracts or capital funding to those companies which can demonstrate they have managed forced labour risks in their supply-chain down to required levels.

The report argues manufacturers and developers, buyers, investors, governments and civil society should come together to address modern slavery risks by acting along the value-chain, setting out a series of questions that will need to be answered to address modern slavery risks effectively.

Forums for such a discussion could include the International Solar Alliance, the OECD and the US-EU Trade and Technology Council, as well as industry associations or a bespoke multistakeholder collaboration.

More information about this research is available on the University of Nottingham website.