The Dire Need for A Post-COVID Green Recovery
COVID-19 has grabbed international headlines and seems to be here to stay. Its economic impacts should not be underestimated too. 8 of the top 10 largest daily point losses of the Dow Jones have occurred between February and March as the markets, both domestically and internationally, seek to absorb the impacts of halting productions, job losses, and restricted free trade due to travel bans. As another recession seems all but inevitable, the world needs to learn from its lessons in the wake of the 2008 recession and choose the right financial stimulus for recovery this time, beneficial for both the economy and our planet.
After 2008, China, the biggest greenhouse gas emitter globally, pursued economic recovery by injecting massive stimulus packages into construction and heavy industries that sparked a construction boom but came at the cost of the climate. In the U.S., similarly, The American Recovery and Reinvestment Act, which sought to promote the growth of the nascent American renewable industries, instead encouraged a wave of boom in the fracking industry and pushed the U.S. to become the biggest oil and gas producer.
The result? A disaster for the climate. As countries scrambled for shortcuts to economic recoveries, the climate was pushed further and further back on the agenda. In 2010 alone, economic stimulus plans around the world led to a growth of carbon emissions by 5.9% in the fossil fuel and construction industries, more than counteracting the 1.4% decrease in the previous year. (https://www.globalcarbonproject.org/global/pdf/pep/Peters_2011_Budget2010.pdf).
The carbon concentration in our atmosphere, meanwhile, rose from 392ppm (parts per million) to 414ppm today, crossing over the crucial 400ppm mark in 2012. Yet as students around the world (fridaysforfuture.org) began to strike in the streets in millions demanding action and the IPCC (Intergovernmental Panel on Climate Change) releasing a worrying report after another, governments seem to be waking up. The European Council, under Ursula von der Leyen, recently had its European Green New Deal overwhelmingly passed by the European Parliament that strived for Europe to become the first carbon-neutral continent by 2050. China has continued to lead the world in renewable investments, as about 38% of the global energy will be produced by renewable sources by the end of 2020. (https://www.bloomberg.com/graphics/climate-change-data-green/investment.html).
But with a looming global recession, everything becomes up for grabs. Instead of pursuing a traditional financial stimulus based on infrastructure, heavy industry, and general constructions, countries could pursue an alternative approach by investing heavily in the renewable sector. Doing so would also be more economically viable as renewable sources like solar is now similarly priced or even cheaper than fossil fuels in many areas of the world, according to the World Economic Forum. (http://www3.weforum.org/docs/WEF_Renewable_Infrastructure_Investment_Handbook.pdf) Investments in battery storage capabilities could help countries pre-adapt to the inevitable transition to a green economy by allowing renewable energy sources to become more readily available, making them more appealing to the public. Investing in carbon capture technologies, though controversial, could be a critical short term solution in removing the carbon from our atmosphere while governmental incentives and tax breaks for electric and alternatively powered cars would encourage both automakers and customers to produce and purchase more of them, decreasing the global emissions immensely while aiding the ailing automakers in both the developed and developing countries.
However, an alternative economic recovery is not favored by major powers around the world who want to play their cards right by sticking with conventional ideas. A debate on relaxing vehicle emissions standards could be a worrying tell-tale sign that China is emphasizing economic growth over its environmental agenda post-COVID-19. The Trump administration, meanwhile, is considering a major bailout of the fossil fuel corporations and airlines, two of the most carbon-intensive industries. The recession would also be a critical test for the European Green New Deal as the varying and competing economic interests within the EU, especially its fossil fuel reliant Eastern members, would be exacerbated by the poor economic performances. Other economic powers like India would have to choose between whether to continue down the path of renewable investments or to protect its state-owned energy sector in light of an economic downturn.
Yet we could not afford the governments the liberty to decide which method to proceed with. According to the IPCC, we have to decrease the global emissions by 45% to have a chance of limiting the temperature rise at 1.5C or 20% at 2C by 2030. Even if we choose to stick with the less ambitious target of 2C, which would lead to hundreds of millions more at risk of climate-induced poverty as well as significantly increase the chances drought, floods, and other extreme weathers than 1.5C(https://www.carbonbrief.org/scientists-compare-climate-change-impacts-at-1-5c-and-2c), we would still have to decrease the emissions by 4% annually if we allow the emissions to peak in the next several years. If we allow a post-2008 traditional fiscal stimulus to happen again, it would be impossible for the world to meet even this target and thus, propelling us onto the trajectory of no return.
As countries would start to draft up their plans to recover from this new global recession, it is paramount that the world leaders cannot be wavered by the short term benefits of a traditional recovery and need to see that a green stimulus is the only probable way to a habitable planet for themselves, our generation, and hopefully, many generations to come