Is There Hope For a Green Recovery From the Coronavirus?
Date: June 11th 2020
Author: Luka Komazec
The COVID-19 crisis is still claiming lives around the globe and putting pressure on economies and healthcare systems. However, as Europe is beginning to open and resume its normal activities, at least in some parts, the recovery plans and their implementation are coming more into focus. People, companies and governments alike are looking to the future and wondering how we move past such an unprecedented event and what lessons we can learn from the pandemic and its effects on mankind.It is within this context that the European Union announced a recovery package that will provide over EUR1 trillion through different grants and loans to support countries and economies to bounce back from the recession triggered by COVID-19. This recovery package seems to have, for all intents and purposes, absorbed the EU Green Deal within itself, which prior to COVID-19, was a key focus for the European Commission. According to senior officials, the recovery programme is intended to be green in its execution and to “do no harm”. The Just Transition Fund, which has been expanded to provide more money for Central and Eastern Europe where it is most needed, will help reskill workers in coal-dependent regions in preparation for the transition to clean energy, and the European Commission has pledged that it will fight to ensure it does not put money into the industries of the past.
This is, of course, excellent news, and the EU has set a great example for the rest of the world at a time when neither the USA nor China are paving the way to a sustainable future with their policies and actions. However, numerous concrete measures are lacking, as are mechanisms for enforcing the green conditions within the EU recovery plan. This has been pointed out by many activists and environmental groups, and with good reason. The recovery plan was brought out at relatively short notice, and it is difficult to get all member states to agree on a budget, let alone a bailout and stimulus plans, but this does not mean that we can afford to lower standards of accountability.
COVID-19 has presented the world with a unique opportunity to reshape the world, and it has bought us a bit of time by temporarily lowering greenhouse gas emissions thanks to economic inactivity. We now ought to ensure that in resuming growth and all the essential activities that humanity needs to thrive across the globe, we do so in a sustainable way that will allow us to face the other important crisis of our time: global warming.
Economies can be steered away from carbon at a much lower cost than would have been thought possible a year ago. Not only have renewable energy sources reached record low costs, but COVID-19 has also pushed fossil fuel prices lower than ever. As demand for energy sank across the globe, the demand for renewables increased by 1.5% in the first quarter of 2020, thanks in large part to no fuel costs and the preferential access to electricity grids granted by some governments. It is time to seize the moment and cut fossil fuel subsidies and introduce a long-debated carbon tax. This tax, as well as the proposed plastic tax in the EU’s recovery plan and a heftier tax on carbon-heavy imports, could help fund the recovery while reducing GHG emissions. Moreover, governments can now exert pressure on carmakers to switch to electric vehicles, and on airlines to abandon domestic routes that can be served by high speed trains (as France has done). These are just some measures that will incentivise the electrification of energy throughout Europe (and the world), while investment in renewables combined with the impact of the Just Transition Fund will create new green jobs and reduce the number of livelihoods dependent on fossil fuels.
It will be very important to see which concrete measures and action plans result from the EU Recovery Plan, and how strictly they will stick to the spirit of the original EU Green Deal. I believe that the private sector, as well as local governments, will have a big part to play in how the recovery plays out and how much emphasis is placed on green investments. Companies and industry remain responsible for two-thirds of global carbon emissions, and while many have been hard hit by the disruption created by COVID-19, the choices they make for how to resume operations will be very important so that the current drop in GHG emissions and energy consumption is not followed by an upsurge that will exceed pre-pandemic levels, which is what usually happens following reduced economic activity due to financial crises.
There were many warnings of the dangers of potential pandemics before COVID-19 hit and the world found itself woefully underprepared. We must not get caught in the same trap with climate change, against which millions of people have been campaigning and ringing alarm bells for decades now. We must act now and act decisively. Given the high costs of the COVID-19 pandemic, it would be a mistake not to take advantage of the opportunities now presented.
Luka Komazec is the Director of Resalta
The opinions expressed by the author do not necessarily reflect the opinions of Energetika.NET.
This article is available also in Slovene.