Countries in Global South paying the price of UK’s clean energy – Oxfam

Report reveals climate colonialism entrenching inequality and human rights violations

The UK and other “advanced economies” are benefiting from cheaper clean energy investment, while countries in the Global South face inflated costs, according to a new Oxfam report.

The UK renewables and electric vehicle industry supply chains are heavily dependent on minerals from countries in the Global South who are not getting a fair share of the profits.

• Although Global South countries hold roughly 70% of transition minerals reserves, most investments in renewable energy are in the Global North (50%) and China (29%) – with those profits falling into the hands of the richest 1%.
• In 2024, Southeast Asia, the Middle East and Africa each received just 2% of the global clean energy investment, despite Sub-Saharan Africa being home to 85% of the world’s population without access to electricity.
• The energy consumed by the wealthiest 1% alone would be enough to meet the basic energy needs of people without electricity access seven times over.

The profits from the transition from fossil fuels into renewable energy are mostly going to super-rich polluters, reproducing colonial patterns that are entrenching inequalities and fuelling human rights violations, says Oxfam’s new report “Unjust Transition: Reclaiming the Energy Future from Climate Colonialism”, published today.

Securing a just transition means tackling today’s shocking inequality in access to energy.

Today, powering 100,000 people with clean energy costs US$95million in advanced economies such as the UK, but the situation is starkly different in its former colonies – in emerging economies such as India it costs around US$139million (45% higher) and around US$188million (97% higher) in African countries such as Nigeria.

Global South countries face interest rates of 9–13.5% for clean energy projects, compared to 3–6% in the Global North, directly slowing electrification and decarbonisation projects. Unless these inequalities are dismantled, the energy transition will only continue to deepen global inequality.

Mateo Adarve Zuluaga, Oxfam climate justice researcher and co-author of the report, said: “The richest countries and individuals are driving the climate crisis to its current tipping point, over-consuming the carbon budget and now they are trying to profit from the energy transition at the expense of most climate-vulnerable countries in the Global South, making inequality even worse.”

“The world stands at a crossroads. The transition to renewable energy could help heal the deep inequalities that drive the climate crisis, or it could entrench them even further. Done right, the energy transition is a chance to reshape our economies around equality, justice, care and collective wellbeing. Done wrong, it will see the most marginalized once again paying the highest price, while the powerful profit.”

The report also describes the “plunder” of minerals like lithium, cobalt, nickel and rare earths, land grabs for bioenergy, carbon removal projects, and seizure of large-scale resources for hydropower, wind and solar. These projects often involve violence, forced labour, and environmental harm, with little consent from local people.

Rich countries also dominate the international financial systems, spending billions on their own transitions while locking Global South countries into a growing debt crisis and leaving them little to fund their own development. So-called developing countries owe $11.7 trillion in external debt—more than 30 times the estimated cost of providing universal clean energy by 2030.

Adarve Zuluaga added: “Many Southern countries are being locked out of transition altogether despite having significant potential – 70% of the world’s wind and solar potential lies in the Global South. Their governments can’t take advantage of falling renewable costs because of high debt and unfair lending terms. Our research shows that the cost of powering people is almost twice as high in African countries, compared to the price in advanced economies.

If low-income economies receive foreign investment, it often driven by extraction and the pursuit of profits for the few over the public good for the many. Energy should serve life, not profit.”

Whilst this colonial imbalance between the Global North and South remains the defining feature of the global economy, patterns of exploitation and extraction have also played out within the North.

Wales, once at the heart of the UK’s industrial rise through coal, bore the brunt of a harsh and unjust transition after the mine closures of the 1980s. That legacy is a key reason why so many communities in Wales still face unacceptably high levels of poverty today. In response, Wales has charted a new path with the Wellbeing of Future Generations (Wales) Act 2015, a pioneering legal framework that puts sustainability, long-term thinking and intergenerational justice at its core. By making wellbeing and global responsibility the compass for decision-making, Wales is showing how an economy can be reshaped around both people and planet.

Oxfam’s report calls on the UK Government to adopt a new decolonised and decentralised energy system, which recognises and repairs the harms of the historical power imbalance and prioritises global co-operation and solidarity by:

• Adopting a public-first financing approach to climate and development goals and rejecting models where public money is used to guarantee private profits.
• Ensuring rich polluting individuals, companies and countries recognise their responsibility for the climate crisis and pay for the damage.
• Reforming international tax, trade and financing rules to unlock barriers for the just energy transition in Global South countries.
• Ending exploitative practices and upholding workers’ rights and human rights
• Introducing a 2% annual tax on net wealth above £10 million to help deliver a just transition in the UK, funding measures such as a mass home insulation programme to cut emissions and lower energy bills and providing real, grant-based support to countries already paying the highest price for a crisis they did least to cause.

People can show their support for a wealth tax by signing Oxfam’s letter to Chancellor of the Exchequer Rachel Reeves here

ENDS

Notes to editors

• A photograph of Mateo Adarve Zuluaga, Oxfam climate justice researcher and co-author of the report is here.
• Download the report here
• Access the methodology note here
• Graphs from the report are available to download : People without access to electricity and Transition minerals reserves