The Grantham Institute’s Dr Alex Koberle blogs on how the response to COVID-19 could help shape a sustainable, resilient future.
The COVID-19 global pandemic is pushing institutions and governments to their limits. People are worried about their health, their families, losing their jobs and the uncertainty the future holds. The economic fallout of this crisis is still uncertain too, and we may well wake up in a few months to a world completely transformed. While the current focus should be on minimising the loss of life, governments around the world are already responding to support a faltering, if not free falling, global economy. The stimulus packages provided will total in the trillions of dollars, euros, pounds, yen, yuan, pesos and many other currencies.
This crisis has exposed many vulnerabilities that can be traced back to the unsustainable development that has ravaged the environment, and yet failed to eradicate poverty and hunger. Governments should take a moment to reflect, learn from past mistakes and redirect development towards a sustainable future. Medical professionals are putting their lives on the line to contain the virus; decision-makers owe it to them to rebuild the world in a way that makes it more resilient to similar situations in the future. Political and financial leaders, said International Energy Agency head Dr Fatih Birol, should consider directing economic stimulus packages that “shape policies … to step up our ambition to tackle climate change.”
How can the government response to COVID-19 help create a more sustainable, resilient, healthy future?
As central banks slash interest rates and inject cash into ailing economies, straight-up bailouts of firms should be subject to a minimum set of preconditions that help to build climate resilience. These should prioritise measures that have a positive impact across several sectors. Here are some examples of key requirements that could be part of stimulus packages to develop a more just and sustainable future:
Improving where we live
Support for the real estate sector should be dependent on direct investments in improving the energy efficiency of buildings, which will generate a host of new jobs for workers and save residents money on energy bills. Most importantly, energy efficient homes are warmer in winter and healthier for residents with respiratory diseases, who are more susceptible to complications from coronavirus and similar pathogens. In tropical regions where heatwaves are projected to worsen with climate change, climate-smart architecture should be prioritised to deliver resilient homes.
Cleaning up our air
Financial rescue for car manufacturers should be linked to the increased deployment of electric or hydrogen vehicles. Similarly, bailed-out energy companies and heavy industries should be required to accelerate replacing fossil fuel power with electricity generated by low-carbon technologies, such as wind and solar power. This would improve air quality, with the added benefit of reducing greenhouse gas emissions. Urban air pollution exacerbates the symptoms and infections experienced by people with pre-existing health conditions, like asthmatics. Data from the 2002 SARS outbreak (also a coronavirus) showed that living in more polluted areas substantially increased the probability that a SARS infection would lead to death.
Embedding long-term resilience in monetary policy
Policymakers could change the remit of central banks (such as the Bank of England) and guide them to include climate concerns in their fiscal and monetary policy. If the upcoming stimulus programmes mimic those from the aftermath of the 2008 financial crisis, they may have the undesirable effect of also supporting the value of carbon-intensive sectors and firms, and result in these banks holding high-carbon portfolios. In places like the United Kingdom and European Union, which have binding climate target laws, this leads to contradictions between climate targets and financial incentives, and between climate and monetary policy.
The green phoenix
Climate change must be addressed in the context of sustainable development. Shutting down the economy and society will not solve climate change. But solve it we must. The Intergovernmental Panel on Climate Change (IPCC) has repeatedly warned that greenhouse gas emissions must halve in the next decade in order to avoid dangerous levels of climate change. Drastic action to reduce emissions will involve massive change, which is partly why policymakers are so reluctant to do what is necessary. However, COVID-19 is now expected to completely upend the global economic structure. The priority now is to control the pandemic and save lives. As the interventions begin to have an effect and we start to emerge from this terrible crisis, it will be time to consider how new investments can help us build a cleaner, greener and fairer future.
Dr Koberle is currently participating in a major European Commission Horizon 2020 project called ‘Paris Reinforce’ to develop resilient mitigation pathways towards a low-carbon future. You can find this blog, and further information on the project, here.
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