Privatisation Another example of the total failure of the current model of energy generation and distribution
The implementation of ENEL's strategic plan for the next two years includes the sale of assets worth 21 billion euros and its complete exit from Argentina and Peru. ENEL plans to reduce its debt and focus on renewable energies. The Italian multinational plans to consolidate its position in six major markets, including Brazil, Chile and Colombia. But the instability that Argentinean and Peruvian workers will suffer also impact Brazilian, Colombian and Chilean workers.
Enel will sell its energy distribution company in Ceará, Brazil (gas generation) in 2023, prioritising the market in large centres such as Rio de Janeiro and São Paulo and in renewables. Also, the company has just sold its Chilean transmission business for $1.39 billion to Grupo Saesa, the largest electricity distributor in southern Chile. A company owned by Canadian workers' pension funds (Ontario Teachers' Pension Plan (OTPP) and Alberta Investment Management Corporation (AIMCo), each with a 50% stake).
The Peruvian assets alone, valued at $5 billion, will undoubtedly attract the interest of strategic investors and investment funds. So, of course, Peruvian workers are worried about their future. This level of instability and insecurity directly affects workers, their families and entire communities. It represents further proof of the total failure of the current model of energy generation and distribution. Corporations are unable to balance the social needs of the community and the needs of the environment with their profit maximisation imperatives. Despite all the renewable energy investments and installations, global greenhouse gas emissions continue to increase. How can we plan for the essential system change needed to reduce emissions and ensure a just transition for workers and society in the context of this level of volatility?
We are not sitting back and waiting to see what happens. PSI is working to connect the struggles of workers, their families and their communities for quality public health, water, sanitation and energy services. We fight for a world where clean public energy is delivered to our homes and governed in the public interest. We fight for a world in which these essential services are provided to all, regardless of their ability to pay. We fight for a world in which the workers who provide these services can live with dignity, respecting their health and safety rights, their trade union rights and quality employment conditions in general. While public services may appear to be a local issue, their quality and governance are directly linked to global policies and issues. It is absolutely necessary to challenge global and regional institutions that impose privatisation or austerity policies.
PSI has a network of unions across Latin America representing energy workers that includes unions in 14 countries. What we hear from our comrades throughout the region is that, in the 1990s, a process of change began in our region towards an unprecedented neoliberal economic model, which generated terrible social and economic changes in society, dismantling the structure of the state and leaving all the processes of development of society in the hands of the market. This system is still in place today and has proven to be counterproductive to the development of society.
Too often, however, public services are privatised, resulting in increased tariffs for the public, decreased accountability and undemocratic governance. We see blackouts rising across the region - it happens because private electricity companies choose to maximise profits by taking the risk of setting up an insecure electricity transmission network so that one small failure leads to the total collapse of the interconnected system. And when it all goes wrong, public sector workers are called upon to clean up the mess and foot the bill along with the population.
The comrades of PSI's Argentine affiliate APSEE are organising a political response that challenges the logic of the current system. While the sale of ENEL's assets in Argentina will surely attract foreign investors and funds, as is the case throughout the region, they are organising to bring energy back under public control. ENEL's decision to exit the country creates a political moment that is also an opportunity. APSEE is organizing at the base, talking to members and to the public. The union is also supporting a bill for the ENEL group companies that will be presented in the Chamber of Deputies and Senators to bring energy back under public control.
"The concerns are the same as those we have been voicing for years, since privatisation, which not only deteriorates jobs and qualified workers and generates anti-union practices, such as the exclusion of personnel from the collective agreement and the emptying of APSEE to weaken the union, but also has a direct impact on the quality of public services.” Carlos Minucci, General Secretary, APSEE Argentina
The neoliberal model of deregulation, unbundling and privatisation of electricity production and distribution has failed. It has failed energy workers whose wages, working conditions and job security are under attack, and whose unions are often dismantled. Essential public services, such as water and energy, must operate in the public interest. They require long-term investment and must be responsive to local communities and the environment rather than to foreign shareholders.
The good news is that the trend is changing. Hundreds of cities have already chosen to remunicipalise their water and energy supply and trade unions are playing a key role in the fight for public control. We know that these battles cannot be won without the involvement of local activists and trade unions. PSI supports them by sharing strategies and knowledge from campaigns around the world. We will continue to help unions resist privatisation and promote a return to public ownership and management.
We understand in the region - and in the world as a whole - that only when energy is managed as a public service can we improve working conditions, health and safety and shift to the cleaner, greener economy we need.