The energy transition: Does ownership matter for realizing public interest objectives?

Abstract

This paper explores the relationship between local public ownership and the sustainability mission of companies in the energy transition. Public ownership may matter due to "contractual incompleteness" where legislation and regulation fall short in dealing with market failures or addressing public interests. Ownership provides a measure of influence and control over the mission and strategy of a company, which is important considering the unanticipated consequences of the energy transition. The role of municipal ownership is underlined by the growing popularity of district heating and cooling systems and the impact of the energy transition on the urban environment. Highlights • It’s impossible to anticipate and regulate all consequences of the energy transition • Market failure may arise due contractual incompleteness • Public ownership can align the objectives of energy companies with public interests • Spatial impacts of the energy transition require shareholders with local interests