Empowering Indigenous Voices Might be the Key to a Successful Green Energy Transition

As the world reduces its reliance on fossil fuels, demand for minerals that are critical for fueling renewable energy technologies — dubbed transition minerals — is skyrocketing. The mining sector has long been scrutinized for the environmental and social harms it’s caused. This article is part of our solutions journalism series investigating potential interventions to prevent the negative impacts of mining as we race toward the net-zero energy transition. 

“We have a new wave of extraction that is coming to Indigenous peoples’ lands, but this time, I think we can make a difference,” Galina Angarova, executive director at SIRGE Coalition, said while reflecting on the sharp increase in demand for transition minerals. 

With 54 percent of transition mineral projects located on or near Indigenous peoples’ lands, these communities feel the impacts of the green energy transition firsthand. From 2010 to 2022, 49 violations of Indigenous rights were reported in projects concerning transition minerals, according to the Business and Human Rights Resource Center.

Organizations like SIRGE, which stands for Securing Indigenous Peoples’ Rights in the Green Economy, are working hard to ensure that Indigenous lands and Indigenous peoples are not neglected as the green transition marches forward.

One of the primary ways to achieve this is to ensure that free, prior and informed consent (FPIC) is obtained from Indigenous communities before the development of any mining project on or near their lands. 

The qualifiers "free, prior and informed" are added to ensure that Indigenous peoples have full determination over the status of projects that affect them. It ensures that consent is not coerced, is obtained before any work starts on the project, and all relevant details of the project are fully disclosed.

Why is free, prior and informed consent vital to the success of mining projects?

The reason we are trying to reduce our reliance on fossil fuels is that we are in the midst of a climate emergency. If we don’t implement any changes, we risk rendering parts of the planet uninhabitable. In short, the green energy transition is about prolonging the existence of the human race.

If mining transition minerals negatively impacts the survivability of certain groups, and renders parts of the planet uninhabitable, how noble is this pursuit of net zero?

Substituting one evil for another isn’t just, nor does it make good business sense.

While the legal standing of free, prior and informed consent varies depending on the country, various courts have made rulings that suggest the failure to obtain it is indeed a breach of the law, even when there is no explicit mention of FPIC in a country’s legal system.

Regardless of the legal standing, however, obtaining free, prior and informed consent before beginning a mining project is in a company’s best interest.

The Las Bambas copper mine in Peru, lithium mines in Chile, the Cobre Panama mine, and countless other mines faced disruption due to local protests emanating from a lack of transparency and consent. 

The cost of mine suspensions from social conflict is estimated to be about $20 million for every week the mine is not in operation, according to a study from Harvard University. This figure varies depending on the size of the mine and the nature of the disruption. The Cobre Panama mine reportedly lost $80 million per day due to inactivity from protests and blockades.

Mines operating without free, prior and informed consent also often lack adequate environmental assessments. 

The disasters at Canada's Mount Polley mine, Brazil's Mariana and Córrego do Feijão mines, and the decades of damage at the Ok Tedi mine in Papua New Guinea are just a few examples of some of the catastrophic consequences of irresponsible mining and lackluster environmental assessments. They destroyed local communities and carried steep financial costs for the companies operating the mines.

Vale, the company that operated the Córrego do Feijão mine, agreed to a $7 billion compensation package on top of the other expenses it incurred from the dam breach disaster that killed 270 people, flattened entire communities and heavily degraded the surrounding environment. Businesses run serious risks when they forego proper consultation with Indigenous groups on projects that could affect them.

“It can be legal risk, political risk, reputational risk, or operational risk and all of that adds up to material risk. If there are operational delays, that’s a material risk,” said Kate Finn, executive director at First Peoples Worldwide, which along with the SIRGE Coalition and Cultural Survival produced a guide for Indigenous leaders on how they can define their FPIC processes and protocols.

Mining companies agree that FPIC is essential

With the growing role that sustainability considerations play in consumer and investor decision-making, conducting proper due diligence and acting responsibly is vital for today’s companies, and mining executives are taking note.

“Strong environmental and social performance is essential to our ability to operate, and a key part of that performance is engagement with Indigenous peoples,” said Jonathan Price, president and CEO of Teck Resources, which recently negotiated 22 agreements with Indigenous communities over the expansion of the Quebrada Blanca copper mine in Chile.

“Their input was incorporated into the project to better reflect their environmental and social priorities,” Price said. 

A Sweden-based mining company, Boliden, expressed a similar approach. “We have a strategic working method to keep a continuous dialogue with Indigenous people, which is based on our and the Sami villages’ willingness to cooperate and find local solutions for specific activities,” said Klas Nilsson, director of communications at Boliden, referring to the Indigenous Sami people of Scandinavia.

While the public comments of mining companies may sometimes be more altruistic than their actions, the acknowledgment from mining executives of the importance of Indigenous peoples’ inclusion in discussions is certainly a step in the right direction.

How could consent not be free, prior or informed?

It is the duty of both the state and the mining company to obtain Indigenous groups’ free, prior and informed consent to a project.

“Each Indigenous community may have different needs, priorities, and agreement processes that companies have to respect and manage,” said Finn of First Peoples Worldwide. “The whole process of FPIC will vary from community to community. There is no one-size-fits-all approach or handbook on how to conduct FPIC.”

Unfortunately, obtained consent isn’t always free, prior or informed. Cases have surfaced in which Indigenous leaders were coerced or bribed into consenting to a project, like at the Fenix nickel mine in Guatemala. In this case, the mine was ordered to close when those findings came to light.

In other instances, important details about a project that may have influenced a community’s decision to provide consent were withheld, and sometimes there is no consultation at all.

Though it’s not a mining case, the Dakota Access Pipeline protests of 2016 are an example of Indigenous groups being left in the dark about a project that may significantly impact them and their land. The original $3.8 billion project ended up costing an extra $8 billion in lost profits and legal proceedings when all was said and done.

Projects that do not obtain free, prior, and informed consent from Indigenous groups face serious material risk and severe financial consequences. Above all, they are exacerbating the threat to human life that the green transition is attempting to solve.

FPIC guides the way forward in the green transition

It isn’t a perfect system. The lack of legal clarity will lead to debates over what is and what is not considered free, prior, and informed consent. The process can be quite time-consuming, as well. Giving the community time to conduct its own internal decision-making process and ensuring all information is provided in a format and language community members understand takes time. 

This time investment at the beginning of the process can pay massive dividends down the road. Having the support of Indigenous groups that also want to see the project succeed can be an incredibly valuable asset.

Indigenous peoples understand the land better than anyone, and they can provide critical information to companies to help them make better-informed decisions.

“It is a false dichotomy that Indigenous peoples are opposed to development," said Angarova of the SIRGE Coalition. "What is true is that Indigenous peoples have economic, social, cultural and environmental priorities that need to be a part of the discussion from the beginning.”

If, for whatever reason, an Indigenous group says no to a project, that means no. Denying a project may prevent major environmental disasters and social unrest, which could also save the company money in the long run. Indigenous peoples know their land, and they can foresee the effects of a mining project.

The inclusion of Indigenous groups in these discussions and the opportunity for them to provide valuable feedback, including the ability to give or withhold consent on a project, may prove immensely valuable to mining companies over the life of a project. And it ensures that the green energy transition is something we can all be proud of.