How the COVID-19 crisis offers lessons for dealing with the climate crisis

Decreases in nitrogen dioxide (NO2) over China, Wikimedia

Bela Galgoczi, senior researcher at the ETUI

The unprecedented pandemic that has changed our daily lives, our work and the entire economy from one day to another is, and will remain, the number one priority for policymakers and social partners in the foreseeable future. Everything needs to be done now to slow down the exponential spread of the virus and empower our healthcare systems to cope with the health emergency. At the same time, urgent measures are needed to fend off the damage caused by the shutdown of the economy and to protect workers in this extraordinary situation.

But beyond these two priorities, we also need to already start thinking about the world after the Covid-19, or ‘Corona’, crisis. The ongoing climate emergency must not be forgotten, and a return to ‘business as usual’ would be a mistake. Few of the governments and organisations (including the European Parliament) that declared climate emergencies in 2019 and 2020 have so far enacted policies in this area with anything like the scale and speed of action with which they have acted to limit the spread of the coronavirus. This is understandable, but it is important that responses to the immediate urgency also take the longer-term emergency into account. There is some sad symbolism to the fact that the Feria de Madrid buildings that hosted the COP25 Climate Summit last December were turned into an emergency hospital.

Both the pandemic and the climate crisis are related to the exponential growth of hazards against a limited capacity to cope. With the pandemic, healthcare capacities are under stress, and we need to do everything possible to flatten the curve of the spread of the decease to avoid their collapse. With the climate emergency, the increase of carbon emissions and of material and resource use are hitting planetary limits that, unlike healthcare capacities, cannot be extended.

The effects of the pandemic belong to the here and now: infections spread in days and weeks, shocking people and governments into action. In a situation of life or death as we face with the pandemic now, immediate action needs to be taken to reduce risk. Climate change, on the other hand, may well bring about just as many deaths (or even more) but responses have not been sanctioned so quickly.

The strong and proactive response to the outbreak holds some lessons for addressing the slower-moving dangers of climate change.

The lockdown of cities, regions or entire countries has led to a sudden drop in greenhouse gas emissions and a consequent unprecedented improvement of air quality. This is certainly welcome, but these effects are not sustainable. There are both opportunities and dangers that arise from these radical carbon footprint-shrinking measures, and policy responses need to balance short-term actions with longer-term objectives.

On the positive side, air quality in the lockdown regions of China showed sudden improvements, as documented by the NASA Earth Observatory. Images from the European Space Agency’s (ESA) Sentinel-5P satellite show similar dramatic air quality improvements for Korea and Italy. An analysis by Carbon Brief suggested there had been a 25% drop in energy use and emissions in China over a two-week period. And according to estimates of the German think tank Agora Energiewende, due to the COVID-19 lockdown, German CO2 emissions in 2020 could shrink by between 50 and 100 million tons. This translates to five percentage points of CO2 reduction, meaning Germany could still reach and even outperform its own CO2 reduction target for 2020 (reaching an average reduction of 42% instead of the earlier expected 37%, when compared to 1990).

On the negative side, rebound effects can reverse any of the positive environmental effects or make things even worse for the long-term, just as we saw at the time of the 2009 crisis. While with a 0.1% drop of global GDP during the 2009 financial crisis, global CO2 emissions fell by 1.2%, in the next year a 5% rebound followed.

The economic shock to people’s livelihoods, with restaurants, small businesses and factories now being forced to close in many parts of the world, demonstrates how damaging rapid responses can be. This is certainly not the way to deal with the climate crisis. At the same time, it is also a stark reminder to avoid a situation in the future where, due to the lack of incremental action taken over a longer period, radical measures might become necessary to avoid complete catastrophe.

The sudden stop of economic activities also has the negative side effect that it reinforces the ‘growth vs. environment’ and ‘jobs vs. environment’ dichotomies that sensible climate policymakers have been eager to leave behind. In such a situation, for most decision-makers and for a large part of the public the priority becomes growth and jobs at any price. Efforts that were focusing on the piecemeal decoupling of emissions from economic growth suddenly seem irrelevant.

A more concrete danger is the collapse of carbon pricing due to shrinking energy consumption during the lockdown, as already shown by data from Italy and Germany. In the space of two weeks, carbon price in the EU Emission Trading System fell from 23€/ton to 15€/ton with far-reaching consequences for decarbonisation objectives and coal phase-out plans. Countries and sectors depending on revenues from the ETS will also suffer from lower funding through the Modernization Fund for low-carbon investments. The European Commission will need to recalibrate initiatives under the European Green Deal to cope with these new realities.

The urgent question now is how to maintain the environmental benefits and avoid a fossil-fuel based rebound once the COVID-19 crisis is over. How can we learn from one crisis response in the pursuit of addressing the other?

It should be avoided that in emergencies, enacted stimulus packages set blindly on `growth at any price` strategies. Economic incentives and capital injections should prioritise low-carbon technologies, such as the retrofitting of buildings, renewable energies and low-carbon transport solutions. Newly launched stimulus packages need to be aligned with the objectives of the European Green Deal, as we need green investment programs, instead of just promoting economic growth regardless of its impact on the environment. Memory is short, but it is good to remember that in 2009 the European Greens/EFA group launched the `Green New Deal for Europe` initiative exactly with the purpose to equip stimulus packages with green priorities.

If governments bail out travel companies and airlines in the way they bailed out banks in 2008 and 2009, then all the forces to promote travel without respect to its carbon footprint will return. Any bailout or subsidy for airlines should therefore have carbon reduction objectives.

As workers without sick leave, income security or affordable childcare may spread the virus because they must work while infected, so will workers without a `just transition` perspective stick to their jobs in polluting industries. A social safety net and trust in a just transition are preconditions for necessary change to happen.

When investments under the newly launched stimulus packages are shifted to low-carbon alternatives and industries get incentives to change, we might see longer-term positive effects, not just a return to business as usual. Moments of crisis can be possible starting points for a longer-term paradigm shift that we badly need for reaching carbon neutrality by 2050. Addressing our biggest problems simultaneously may be more effective than taking them on one by one. Economic stimulus packages launched to alleviate the effects of the sudden stop of the economy should therefore be aligned with the longer-term objectives of the European Green Deal.

The European Trade Union Institute is the research & training centre of the European Trade Union Confederation (ETUC).

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