Will investments in greener energy be yet another victim of the coronavirus?

A nearly empty East 42nd Street is seen in midtown Manhattan as the coronavirus disease (COVID-19) outbreak continues, in New York City, New York, U.S., March 23, 2020. REUTERS/Mike Segar

I’ve seen news stories over the past week about plummeting greenhouse gas emissions and pollution in areas suffering the worst effects of the coronavirus. For example, emissions from China went down by 25% during the worst phase of the virus. Analysts are expecting greenhouse gas emissions to fall this year for the first time since the financial crisis in 2008-09.

The measures that we are taking to control the virus — social distancing that is eliminating most kinds of business or social gathering — are drastically reducing energy demand. Factories are idled, commuters aren’t commuting, non-essential businesses are shut down, and people are spending most of their time at home, first in China, then in Europe, and now in North America. This sounds like great news for the climate, right?

Sadly, I’m concerned that the answer will be no. The virus and our efforts to limit its spread are destroying economic activity. The U.S. stock market has now given up all of its gains in the more than three years of the Trump administration.  Small businesses, especially in the services sector, are facing dire conditions and larger businesses are pulling back on investments. As my Brookings colleagues have pointed out, low-wage workers stand to suffer the most, both in terms of health and economics. In these times, attention and investments in decarbonizing the economy are naturally taking the back seat.

Climate change is a long-term problem requiring long-term thinking. However, facing an existential threat like a pandemic, governments and individuals are necessarily thinking about the short term. Long-term thinking feels like a luxury we cannot afford right now. It’s true that some stimulus funding could be directed toward clean energy investment and research. Democrats in Congress are pushing for that, along with the head of the International Energy Agency. However, competition for that money is fierce. Many businesses are facing disappearing demand and laying off workers or facing bankruptcy. Unemployment claims are skyrocketing. Helping affected workers and businesses must be the primary goal of stimulus.  Eventually, lawmakers will turn back to long-term thinking, but the question is when?

It remains to be seen how the economy and consumer activity will recover when the virus recedes. The most important questions today are not economic, but epidemiological. If the virus recedes and the economy recovers relatively quickly, then the world can once again turn to thinking about long-term challenges like climate change. This would be a change from the past, when greenhouse gas emissions have quickly returned to their previous upward trajectory after recessions. But governments and voters are more focused on climate today, and a quick recovery followed by renewed emphasis on climate is the best-case scenario.

However, if the economic crisis is prolonged and recovery is slow, I fear that investments in clean energy will be slow to return. At a time when everyone is cutting back on all kinds of investments, expecting the clean energy transition to continue apace just isn’t reasonable. For the time being, our additions to the atmosphere’s greenhouse gas load are slowing, and we can be grateful for that. However, I hope that our efforts to green the global energy system don’t face a serious setback, as yet another victim of the virus.