Seizing the chance to build back better
The coronavirus disease 2019 (COVID-19) pandemic has challenged many facets of society, from creating safety hazards to regular face-to-face contact to revealing the continually-growing inequality between the rich and poor. Thus, the call for a Great Reset has been gaining momentum, an initiative that seeks to build the world back better than it was before the pandemic.
“The COVID-19 crisis, and the political, economic and social disruptions it has caused, is fundamentally changing the traditional context for decision-making. The inconsistencies, inadequacies and contradictions of multiple systems – from health and financial to energy and education – are more exposed than ever amidst a global context of concern for lives, livelihoods and the planet. Leaders find themselves at a historic crossroads, managing shortterm pressures against medium- and long-term uncertainties,” the World Economic Forum wrote about the initiative.
Energy is a major part of it. Being a major contributor to the incoming climate crisis — one that is predicted to have worse consequences than the pandemic — the energy industry has been the focal point of many global initiatives pursuing sustainability, including the Sustainable Development Goals put forward by the United Nations.
According to the International Energy Agency ( IEA), global energyrelated CO2 emissions rose to a historic high of 33.1 Gt CO2 in 2019. While emissions from all fossil fuels increased, the power sector accounted for nearly two-thirds of emissions growth. Coal use in power alone surpassed 10 Gt CO2, mostly in Asia. China, India, and the United States accounted for 85% of the net increase in emissions, while emissions declined for Germany, Japan, Mexico, France and the United Kingdom.
Meanwhile, the IEA predicts that with the global economy set to shrink by 6% in 2020 due to the pandemic, some 300 million jobs may have been lost during the second quarter of the year. The shockwaves of this can be felt through energy markets, with global energy investment expected to shrink by an unparalleled 20% in 2020.
“The energy sector, particularly electricity, has played a critical role in the global response to the COVID-19 crisis. Uninterrupted energy supplies have enabled hospitals to provide care, food and other essentials to be delivered, and millions of people to work and study from home while maintaining social contact online. Without access to reliable and affordable electricity, the lockdowns introduced by governments to tackle the public health crisis would have resulted in far greater economic damage,” the IEA wrote on its website.
With the world reeling from the impact of COVID-19, leaders and policymakers are faced with the herculean task of implementing hugely consequential decisions in a short span of time.
This is the reason that the organization, in cooperation with the International Monetary Fund, released a Sustainable Recovery Plan that proposed a set of policy actions that would boost economic growth, increase employment and tackle the energy industry’s carbon emissions all at once. Specifically, the Sustainable Recovery Plan seeks to achieve the following: boost global economic growth by an average of 1.1 percentage points a year; save or create roughly nine million jobs a year; and reduce annual global energyrelated greenhouse gas emissions by a total of 4.5 billion tonnes by the end of the plan.
In addition, the plan would deliver other improvements to human health and well-being, including driving a 5% reduction in air pollution emissions, bringing access to clean- cooking solutions to around 420 million people in lowincome countries, and enabling nearly 270 million people to gain access to electricity.
The IEA stated that achieving these results would require global investment of about USD 1 trillion annually over the next three years, representing about 0.7% of today’s global GDP and includes both public spending and private finance that would be mobilized by government policies.
The plan sets out the policies and targeted investments for each key sector, including measures designed to: ( 1) accelerate the deployment of low- carbon electricity sources like new wind and solar, and the expansion and modernization of electricity grids; (2) increase the spread of cleaner transport such as more efficient and electric vehicles, and high- speed rail; (3) improve the energy efficiency of buildings and appliances; (4) enhance the efficiency of equipment used in industries such as manufacturing, food and textiles; (5) make the production and use of fuels more sustainable; and (6) boost innovation in crucial technology areas including hydrogen, batteries, carbon capture utilization and storage, and small modular nuclear reactors.
“Governments have a once-in-alifetime opportunity to reboot their economies and bring a wave of new employment opportunities while accelerating the shift to a more resilient and cleaner energy future,” said Dr. Fatih Birol, IEA executive director.
“Policy makers are having to make hugely consequential decisions in a very short space of time as they draw up stimulus packages. Our Sustainable Recovery Plan provides them with rigorous analysis and clear advice on how to tackle today’s major economic, energy and climate challenges at the same time. The plan is not intended to tell governments what they must do. It seeks to show them what they can do,” Dr. Birol added. — Beltran
“The energy sector, particularly electricity, has played a critical role in the global response to the COVID-19 crisis. Uninterrupted energy supplies have enabled hospitals to provide care, food and other essentials to be delivered, and millions of people to work and study from home while maintaining social contact online.”