Magazines - 05/May/2020

Spring/Summer 2020

Getting the finance to flow

Coronavirus crisis can catalyse clean energy investment

 

The world was going into a tailspin as FORESIGHT Climate & Energy went to press as emergency measures to tackle the spread of the Covid-19 virus were implemented, causing panic in the markets and increasing the likelihood of a global recession. As shops shut, factories closed and planes ground to a halt, governments scrambled to agree financial packages to bail out companies and support individuals, with some calling for the clean energy transition to be bumped down the political and economic pecking order.

While knee-jerk reactions in certain quarters focused on propping up twentieth-century industries and business models, more forward-thinking organisations and individuals were highlighting the crisis as an extraordinary moment to change the way we work and finance the world — for our health, the climate and prosperity.

The effects of Covid-19 are likely to be temporary, while the threat posed by climate change will remain, says Fatih Birol, head of the International Energy Agency (IEA). “We should not allow today’s crisis to compromise our efforts to tackle the world’s inescapable challenge,” he states, underlining the potential of stimulus packages to “build a secure and sustainable energy future”. Large-scale investment to boost clean energy technologies should be “a central part of government plans,” adds Birol. IEA analysis shows governments directly or indirectly drive more than 70% of global energy investments.

The reaction to the Covid-19 virus and lifestyle restrictions accepted around the world also demonstrate that when we agree as a society something is an emergency, we deal with it. It is clearly easier for people to accept drastic steps for a presumed short period than the sustained lifestyle changes that reducing greenhouse gas emissions require. But the coronavirus crisis should be a wake-up call for the world, showing what can happen when experts and science are ignored. It can be the trigger needed to take climate change forecasts seriously.

The real block to climate action is our collective choice not to act. We now have the opportunity to turn that mindset around, using the pots of money being released by governments to support the clean energy transition and ensure jobs and prosperity for today’s workers and future generations. Pushing back against climate action will help no-one in the longer term.

“A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty,” said UK Prime Minister Winston Churchill. Now is the time for us to grasp the full range of opportunities offered by this emergency and make the right financial choices to reduce the threats posed by climate change and increase economic and societal resilience.

– By Philippa Nuttall Jones, Editor in Chief

 

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