In just a few months, the coronavirus pandemic overburdened hospitals around the world, killing thousands of people, disrupting travel and trade, and plunging the economy into an unprecedented global crisis.
But while the world's attention is rightly focused on these pressing public health and economic issues, we should not ignore the challenge of global climate change.
Given the collapse of global economic activity, it is almost certain that CO2 emissions will fall this year. Last year, even as the global economy grew, emissions leveled off.
But I don't think there is any reason to celebrate the decline in emissions caused by coronavirus, which may be due to premature death, widespread suffering and economic hardship. As the economy recovers, emissions will rebound.
The government will address this health crisis. The climate challenge we face should be taken into account as they develop measures to help the world economy recover from this extraordinary shock. Their stimulus plan should seize the obvious opportunities, create jobs and improve important infrastructure, and accelerate the important transition to clean energy.
Each country's energy system has its own characteristics, and the use of public resources needs to be tailored to each situation. But there are five broad areas in which governments can act:
Stimulate demand through cash for clunkers: consumer spending tends to fall sharply in a downturn, so governments should encourage people to start buying commodities such as cars and washing machines. The cash for clunkers program, which focuses on economic incentives, aims to improve the energy efficiency of household major commodities, stimulate consumer demand and achieve sustainable emission reduction.
Put clean energy jobs at the heart of the stimulus: Although the cost of wind and solar technologies has fallen sharply in recent years, they have not yet reached the level of investment needed to achieve the international climate goals. Government support for wind and solar farms is a fast way to create new jobs across the supply chain. Investment in energy efficiency is also good for employment; previous stimulus programs in the United States and elsewhere have provided a lot of work by stimulating the demand for labor-intensive jobs in building upgrades, so they use less energy to heat in winter or cool in summer.
Building state-of-the-art power systems: as millions of adults and children suddenly find themselves trapped at home, the coronavirus has triggered a massive attempt to work and teach online. This highlights that our society depends not only on the Internet, but also on an affordable and reliable supply of electricity. The power grids are helping us through the current crisis, but they are not ready for a more electrified future, in which case wind and solar power account for an increasing share of power generation. Investment in strengthening our grid and integrating smart digital technology into its operation should be a priority for all places.
Developing and expanding next generation energy technologies: there is no single or simple solution to the global climate challenge. This will require the use of a variety of different energy technologies. In particular, batteries, hydrogen and carbon capture, these three technologies are at a critical moment, and large-scale manufacturing and development can transform them into important elements in the global clean energy transformation. A strong boost to the stimulus could help these technologies to scale up and make them more cost competitive, thereby building industries that can generate new jobs in the process. Through energy venture capital funds and targeted R & D investment, public funds can also lay the foundation for new technologies needed to meet the growing number of net zero emission targets set by governments, including the UK.
Bring in more private money: all of these efforts will be more effective if policymakers establish a clear, long-term, broader energy plan that private investors are seeking. Getting the right price signal by eliminating fossil fuel subsidies or carbon pricing, or by lending and co investing in clean energy projects, can help reduce many of the risks that previously hindered private funding.
Today, we see that government leadership is crucial in dealing with the coronavirus crisis. This leadership is also needed to drive the clean energy transition. According to IEA analysis, the government directly or indirectly promotes more than 70% of global energy investment.
We have two curves: the coronavirus infection curve and the global emission curve, and we need to work quickly to make it a downward trajectory. Neither is easy. But through wise, timely action and cooperation, governments can ensure that we achieve both.
By Fatih Birol