The environmental state: Analysing the ‘creation’ of renewable energy markets in the United Kingdom

Following work on the green state, the environmental state has become a prominent analytical concept in recent decades commonly applied to understand the expanded role the state has taken in decarbonizing the national economy. This article demonstrates that there is yet further empirical value to be gleaned from this subject acknowledging that the environmental state’s recently more expanded role in securing the green transition is not without historical precedent. Specifically, we propose an additional function for the environmental state of ‘market creation’ – accepting the process by which environmental states operate ex post facto ownership positions in already-existing energy markets for fossil fuel commodities – but also identifying it can use its power and agency in an ex ante fashion to create entirely new markets for renewable energy. In historicizing the environmental state, we show that whilst ex ante actions to create markets for renewable energy are not necessarily new, it has yet to be identified conceptually, and through a case study of the United Kingdom (UK) and the creation of a new national market for renewable energy we seek to demonstrate the conceptual value of a proposed new function of market creation for the environmental state. Beginning in the 1989 Electricity Act, market creation by the UK environmental state has proceeded through various reforms such as the introduction of Renewable Obligation Certificates (RoC) in 2002 to Contracts for Difference (CfD) in 2013, continuing in efforts in the 2020s to create markets this time for low carbon hydrogen.