Opinion - 30/April/2020

Managing crises by learning fast – from COVID-19 to climate

Investments spent on dealing with the social and economic impacts of Covid-19 in Europe should focus on achieving the highest value outcomes in line with the objectives of the European Green Deal, insists Simon Skillings from think tank E3G

The central policy challenge facing both the COVID-19 and climate crises is the same — we must be able to take big decisions and make rapid progress in the face of huge future uncertainty

 

Society is facing two crises.

One has emerged dramatically over a matter of weeks – Covid-19. It has led governments around the world to impose radical measures to curb social interactions and spend vast amounts of public money to put economies on life support. The success, or otherwise, of this response will become apparent within months and afterwards we will return to a new normal.

The other, climate change, has been developing over decades. Despite broad acceptance of the nature of the problem and the remedial measures required, the response of governments has been slow. The impacts are already apparent and getting worse. Within a few decades they could become catastrophic. More worrying is that these impacts cannot be reversed, and we will become locked into global weather systems for centuries to come.

The central policy challenge facing both the Covid-19 and climate crises is the same — we must be able to take big decisions and make rapid progress in the face of huge future uncertainty. The climate policy response has all too often involved a wait-and-see approach, deferring difficult decisions until more information comes to light. Alternatively, money is spread like confetti on numerous uncoordinated or business-as-usual actions which ultimately prove to be high cost or even counterproductive.

 

 

A NEW GOVERNANCE APPROACH

The climate crisis does not allow us the time to find out that delivery processes have failed, and to initiate a new policy development and implementation process. This is particularly true given the nature of big infrastructure decisions whose legacy will be felt for decades. A new approach to governance is required. The net zero target enacted under the proposed European Climate Law needs to be matched by forward-looking governance that can drive speedy implementation, ensuring innovation and infrastructure investment processes are aligned with the climate neutrality objective.

One obvious legacy of Covid-19 will be that huge amounts of money will have been spent in saving lives and stabilising the situation and there will be far less available to begin the process of rebuilding the economy. It will be essential that investments are not scattered randomly across a multitude of promising, but uncoordinated, activities. Instead, they should focus on achieving the highest value outcomes in line with the objectives of the European Green Deal. Policy alignment should be ensured by the governance system embedded in the proposed Climate Law. This is no easy task, however, given the number of possible pathways to 2050, each with their advocates and detractors.

A new governance system must be flexible and adaptive and link innovation processes with deployment activities. It must support EU cohesion by preventing some member states falling behind as a result of asymmetry in knowledge and resources. Also, it needs to co-ordinate actions across sectors and empower governments and regulators to wisely spend citizens’ money. In short, it must help to ensure that actions across key EU policy files are aligned. These include the TEN-E revision and the proposed gas package, as my colleagues lay out in a newly launched briefing paper, as well as the Multi-annual Financial Framework, and files related to research and innovation (Horizon Europe) and the just transition.

This new approach to governance requires a function or ‘observatory’ that brings together experts on the energy system transition to establish an independent science-based view of the path ahead. It would aim to shine a light on the future and to provide the clarity that will enable the EU and member states to make efficient and coherent infrastructure decisions. The observatory would answer a critical question: given where we are now and what we know now, what is the best way to invest our money?

The observatory would identify the latest best view of technology costs — now and going forward — and associated deployment potentials. This would consider geographical differences and, importantly, place equal emphasis on all options including those associated with smart and efficient energy consumption. This information would be used to explore different deployment pathways towards net zero.

The key output from the observatory would be advice on the big infrastructure choices that need to be made, when they must be made and what associated risks and innovation needs arise. It will provide system planners with a description of the future technology landscape for which we must be prepared, including where we need to support one pathway now and where we should continue to support several options until more information is available. This will also help focus the research and innovation agenda on solving the most important outstanding problems.

 

LEARNING FAST

Any view of the future will be wrong. It is not about being right, but about learning and course-correcting as fast as possible. The observatory must lie at the heart of a learning process, regularly updating advice on infrastructure choices and innovation needs as more information comes to light. Importantly the evidence underpinning the advice should be fully transparent. The observatory will help those with a democratic mandate — member states, regulators, regional governments — make better decisions. They can always choose an alternative path if they wish, but resulting inconsistencies or new risks would be apparent and consequently could be managed.

Perhaps the best way to understand the value of such a function is to consider how a medical analogy might relate to the Covid-19 crisis. A body to pool medical expertise across the EU would have been established as soon as the threat was initially identified. It would regularly monitor information emerging from across the world and use this to recommend a course of action.

This approach would highlight where national differences might affect responses and be regularly updated as more information comes to light. This repository of information would have been available to all member states and the advice provided would be the basis from which national strategies could be devised. Each government would be able to point to the transparent scientific evidence upon which their national response was based.

Expertise matters and the pooling of expertise, as outlined in the proposed EU observatory, is a powerful tool for shaping the future we want. Dealing with crises mean we must transcend political points scoring and the special pleading of industrial lobby groups. It also means that we need to act quickly, despite future uncertainty. The EU can introduce a governance system that will deliver net zero emissions. It must take this opportunity.


The views expressed in this opinion are those of the author and do not necessarily reflect the position of FORESIGHT Climate & Energy

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