Where are we heading on climate policy?

In our latest blog, Paul Goldrick-Kelly points out that recent predictions of emissions declines due to the covid-19 lockdown are likely to be temporary. He argues that we should take the opportunity to rebuild a changed, sustainable economy.

Climate Change

Global emissions are falling, for the first time in over a decade. A recent analysis from the International Energy Agency projects a decline in global energy use of about 6% and a decline in energy related emissions of 8% or approximately 2,600 million tonnes of CO2. 

This projection is based upon assumptions about lockdowns and related measures and as such, is uncertain. But should this projection be accurate, it will represent the largest drop ever recorded, over 6 times as large as recorded after the financial crisis. Closer to home, the SEAI estimates that carbon dioxide emissions may fall by 12% this year, bringing us back to where we were in terms of emissions in 2010.

Obviously, in the context of a dangerous pandemic, we shouldn’t celebrate these numbers. Much of it is driven by a cessation in economic activity which will roll on, which has already affected many and will impact some more than others

However, they do highlight the way our current economic set up damages the planet. 2020 looks set to be the first emissions fall consistent with the UN’s recommendations to limit warming to 1.5 ° C above pre-industrial levels. However, this fall is the result of a global recession, and efforts to reboot the economy will likely see emissions substantially rebound, as they did following the financial crisis

According to last year’s emissions gap report, globally, emissions need to fall by 7.6% each year for a decade. The size of the necessary cuts will only grow the longer we delay – we already have a substantial amount of greenhouse gas in the atmosphere and even now, we are recording record atmospheric carbon dioxide concentrations. Reducing the flow is good, but we must equip our economies to turn off the tap of emissions. We cannot aim to go back to normal.

Therefore, it is essential that any moves to recovery begin to reshape global and local economies in a green direction. This will require international coordination and action at the national level. Both jurisdictions on the island of Ireland must pull their weight as part of this effort and begin to address their high levels of emissions per person.

Fortunately, living standards and sustainability aren’t necessarily counterposed. Green measures can create far more jobs than they displace, representing an opportunity to improve conditions for many. A green stimulus programme of national recovery could put people back to work as this crisis ebbs. In the medium and longer term, this would involve expanded infrastructural investment and a public programme of research and development to reshape our economy

In the shorter term, we can fund interventions which generate substantial levels of employment quickly. We should put people to work in areas such as deep retrofitting our buildings and homes – reducing energy use, bills for many and ultimately emissions. Green government procurement could embed green practices and promote higher standards for workers.  Policy could begin to redress regional inequalities on the island and kickstart domestic development, all the more pressing given the unequal spread of economic damage related to the Covid-19 outbreak

The crisis response has revealed many collective capacities we were only vaguely aware of. This crisis has seen the government step in to protect incomes in an unprecedented way, including more substantial welfare payments and furlough schemes to protect employment pushed by the trade union movement. These are precisely the sorts of measures that we could use in a green transition to support livelihoods and prevent regional decline. As I pointed out in my last blog, the evidence on tax pre-crisis suggests that there is substantial scope to fund these sorts of programmes as the economy recovers.

A green spending programme, a more expansive system of social protection and the involvement of workers and their communities in the decisions that affect their lives could see us build a new, sustainable and fair economy for the people of this island. The novel coronavirus response has made some of the outlines of this new set up clearer. We should not let a crisis go to waste.
 

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Paul Goldrick-Kelly


Paul Goldrick-Kelly is an Economist at the Nevin Economic Research Institute and is based in the Dublin office. Paul’s work to date has examined a number of issues related to healthcare, housing, taxation and expenditure as well as productivity performance in the Republic of Ireland. 

His current research interests include elements of a Just Transition to more ecologically sustainable economy and associated development.

He is a graduate of University College Dublin with a HDIP and MA in Economic Science.

Contact: [email protected] or 00353 1 889 77 22.