This project aims to develop an analytical framework for understanding the ambiguous roles states play as market actors in the green energy transition. States are not only regulators of energy markets – as standard economic theory would tell us – but they also rank among the largest global fossil owners and investors. At the same time, many nation-states are also at the forefront of sustainable asset ownership and provide important investment for expanding renewable energy sources. In their role as market participants, states are hence both, a transformative force in the green transition but also a direct fossil profiteer. Political Economy scholarship has established the former, while recent work on the green or environmental state highlighted the latter (Lamperti et al. 2019; Babić and Dixon 2022). We however lack an analytical framework that integrates these insights and enables us to empirically identify under which circumstances states as market actors de facto curb or accelerate green transitions. This project develops such a framework by deriving and integrating three core dimensions – state fossil ownership, state renewable investment, and the political and economic factors reducing the former and increasing the latter.

Theoretically, this project combines insights from International Political Economy, Environmental Politics, and Critical Political Economy to support the proposed framework. As a first step, I develop the analytical framework, drawing on interdisciplinary insights on state ownership and investment in green transitions. In a second step, I then test this framework empirically in a comparative case study of two states that are both large fossil owners and renewable energy investors (Saudi Arabia and Norway). The envisaged framework will be interdisciplinary and applicable beyond the studied cases. It speaks to the urgent task of providing critical, problem-oriented tools for analyzing the prospects of state-led green transitions in the ongoing climate crisis.