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Can we trust citizens to organise our power utilities through direct democracy?

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Can we trust citizens to organise our power utilities through direct democracy?

06-02-2023

There is a growing trend of remunicipalisation of utilities worldwide - citizens at local and regional levels reorganising utilities with the maximum aim of public interest in mind. Portland, one of the largest cities in the U.S state of Maine, is gearing up to take a citizens’ initiative to the polls in November 2023. 

The main organisers of this initiative, Our Power, have spearheaded the petition tapping into voter frustration in order to transform Maine’s electricity landscape. The petition aims to take this issue to a referendum- a direct democracy tool that gives citizens direct access to decision-making around issues of public interest - to remunicipalise the city’s energy utilities. For background, we must go back to 2018 – the campaign began at a time when the current energy suppliers, international energy giants Central Maine Power and Versant, were facing severe backlash for rising electricity prices and inaccurate billing that came at a time where the city was experiencing prolonged storm-related power outages. 

Remunicipalisation commonly refers to the return of previously privatised utility services to municipal authorities, it encompasses regional or national initiatives. Today, in Portland there are two camps of divergent views within the citizenry. This is demonstrated by the counter-petition which has been launched by the private utilities providers and a growing number of business groups. The opposition has launched a competing ballot question engaging voters on the financial implications of buying out the private sector. The initial petitioners are organised through various NGOs led by Our power which is a “group of Maine ratepayers, business leaders, energy experts, conservationists, and others committed to putting the Pine Tree State’s energy future in the hands of Mainers”. 

There are varying degrees of remunicipalisation that have been pursued throughout the international community over the years. In Uruguay it came down to being a question of human rights and constitutional reform. On October 31, 2004, an awe-inspiring majority of the citizens of Uruguay voted in a referendum, that took place during the national elections, to add a new constitutional provision stating that access to drinking water and sanitation are a fundamental human right. The results of the referendum prohibited the private ownership of water and further states that water is a matter of public interest. The referendum was endorsed by the National Commission in Defense of Water and Life (CNDAV)- a coalition of movements and organisations. This bottom-up initiative aimed to reduce the environmental burden that resulted from inadequate access to safe drinking water as well as the reduction of the high cost of operation of private water companies. This achievement set an important international precedent as one of the first instances where an environmental right had been integrated into a country’s constitution through direct democracy.

Remunicipalisation took a similar shape to that of Portland Maine in the city of Hamburg, Germany. On September 22, 2013, the citizens voted in a referendum for the full remunicipalisation of the energy distributions grids in the city. The grassroots campaign was spearheaded by ‘Our Hamburg, Our Grid’ was supported by an alliance of over 50 groups. This alliance emerged out of intensifying frustration with Vattenfall, the owners of the energy grid during that period, for failing to make investment decisions that acknowledged the urgency of climate change. Vattenfall owns two nuclear reactors near Hamburg as well as two of the dirtiest coal plants in Europe. This campaign aimed to create a local power utility that would enable the city to provide greener, potentially less expensive and more reliable sources of energy. The narrow victory of 50.9% had a binding effect which led to the city government setting out with the implementation of the referendum decision by repurchasing of the city’s gas distribution grid. So far, Hamburg can be considered on track in implementing the referendum decision. However, key challenges remain unsolved. In particular, the repurchase of the district heating grid is still uncertain due to financial constraints.

There is a clear demand for direct democracy tools in the organisation of utilities. This growing trend is putting power in the hands of the citizens to decide how their communities operate. Similar examples have been seen in Taiwan, Berlin Germany as well as in Colorado in the US. Whether it is a conversation of constitutional reform like we have seen in Uruguay or the transferal of ownership that is being worked towards in Hamburg it is encouraging to observe the increased use of direct democracy tools to achieve change. It will be interesting to follow the developments in Portland Maine to learn how the citizens envision the future of their electricity landscape.   

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