The social performance approach. Fostering community well-being through energy-sector investments

While the positive impacts of renewable energy development, the implementation and use of renewable energy for people and the planet are widely recognised, the direct contribution of local renewable energy projects to local community well-being has received limited attention. And while the Paris Climate Agreement and the 2030 Agenda for Sustainable Development, with its Sustainable Development Goals (SDGs), have been rightfully celebrated as global milestones towards securing livelihoods and opportunities now and in the future, they lack societal ownership and traction among communities, who are decisive in supporting and driving the necessary sustainability transformation. However, aside from energy access, the opportunities for local energy projects to provide broader positive effects (such as community revenues) through co-investments are largely regarded as secondary co-benefits, if not entirely ignored by development policies and practices. Tapping into these opportunities for effective policies and practices in climate action and international development calls for a different approach to sustainable energy development (energy transitions in some countries): a social performance approach to energy development and investment, which we outline in this paper. In the context of this paper, the social performance of energy sector investments refers to direct and positive social impacts on the well-being of individuals and communities during the development and implementation of energy projects and the usage of locally generated energy, in both monetary and non-monetary ways. In essence, the social performance approach in energy-sector investments and energy-project development puts the needs and well-being of people – both current and future generations – at the centre of energy development and related investments and activities. The social performance approach that we propose builds on the conceptual foundations of the capability approach, the co-benefits approach, the Need–Opportunity–Ability (NOA) model, and important groundwork on community development in South Africa’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP). An important aspect of the social performance approach is its focus on the direct contribution of these investments in fostering the well-being of individuals in a manner that reflects their aspirations for good quality of life. This approach can facilitate regular evaluation of progress and ensures accountability and adjustment of implementation strategies so that future investments, design, and implementation strategies perform both for people and the planet. Social performance can be used to compare how different energy options (e.g., a coal-mining site, a renewable wind park, or decentralised energy services such as solar mini-grids) may effectively and comprehensibly improve the lives of people and local communities. The social performance approach helps to identify concrete intervention points or enablers, to ensure and increase the positive contributions of energy-sector investments to the well-being of individuals and communities, either in monetary ways such as local economic value creation and employment, or in non-monetary ways such as community cohesion and social inclusion. In this paper we suggest that, consequently, policy interventions and investments aimed at decarbonising energy systems should not simply be monitored in view of how they perform for communities and people on the ground; rather, these interventions and investments should be intentionally designed to maximise their social performance for individuals and communities.