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Covid-19: The Low-Carbon Crisis. My latest for @BloombergNEF is a deep dive into the implications of the pandemic on the energy and transport transition. TLDR: it changes everything: about.bnef.com/blog/covid-19-…
At the end of last year I predicted that energy-related CO2 emissions would peak and then drop by around 5% by 2030.  Never before has one of my big predictions been proven quite so right, so quickly – albeit for entirely unforeseen and tragic reasons. about.bnef.com/blog/covid-19-…
I don’t feel particularly comfortable speculating about the impact of Covid'19 on the low carbon transition, given the scale of the human tragedy that is unfolding. But there is too much talk of quick recoveries and oh-so-clever green stimulus programs. about.bnef.com/blog/covid-19-…
If you think this will be over in a couple of months, I have some luxury cruise tickets to sell you. There have been 4 global recessions since WW2: 1975, 1982, 1991 and Great Financial Crisis of 2009. The Covid-19 Recession of 2020 might well top the list. about.bnef.com/blog/covid-19-…
We could end up in a few months on a 2-speed world, in which some countries and states have all but eliminated the virus, but in others it rages out of control. A humanitarian catastrophe. And the global economy would remain in deep recessionary territory.
about.bnef.com/blog/covid-19-…
A vaccine is the only thing that really puts a stop to all this. A few dozen groups around the world have been working on one, several already beginning human trials. Maybe one will be available for general use before the end of the year. Here’s hoping!
about.bnef.com/blog/covid-19-…
And then there's the oil price collapse. With the message sinking in that the world is looking at peak demand within two decades, perhaps a fight for market share at some point was inevitable - but it could not have come at a worse time.
about.bnef.com/blog/covid-19-…
Saudi Arabia tried something similar in 2014/15, no reason to believe this time will end differently: it can boast of its $9/bbl extraction cost, but its fiscal breakeven is around $80/bbl – think of the whole country as a massively inefficient producer. about.bnef.com/blog/covid-19-…
A sustained $30 oil price might drive U.S. shale producers into bankruptcy, but most would restructure and remain operational under new owners. Russia can survive low oil prices for a decade. But Saudi Arabia can last only 2-3 years before suing for peace.
about.bnef.com/blog/covid-19-…
Spare a thought for poorer oil-producing nations, which are facing the dual catastrophe of a cratering oil price and an uncontrollable pandemic. Hard to see countries like Venezuela, Angola & Nigeria get through the next 24 months without extreme pain. about.bnef.com/blog/covid-19-…
In summary, it looks like the combined impact of Covid-19 and the oil price war could be on a similar global scale to that of the Great Financial Crisis. Never before have I described a scenario and so much wanted to be proven wrong.
about.bnef.com/blog/covid-19-…
The clamor for a “green stimulus” has already begun. But pouring billions of dollars into electric vehicle charging stations, renewable energy projects or solar rooftops over the next few months will not keep people, safe, fed and employed (even if idle).
about.bnef.com/blog/covid-19-…
As soon as the immediate crisis has passed, however, and attention moves to reflating economies, that is the time to ensure that clean energy, transport and smart infrastructure is at the heart of any longer-term stimulus.
about.bnef.com/blog/covid-19-…
Some examples. 1) Instead of bailing out car companies with cash, send a wall of demand for EVs their way. Make home delivery companies switch quickly to EVs. Accelerate the electrification of buses & taxis. Mandate public authorities buy only EVs.
about.bnef.com/blog/covid-19-…
2) No bailout should benefit industries or business models that are not viable in the coming low-carbon world – such as low-cost airlines, coal-fired power generation, or uneconomic operations in shale oil and gas, oil sands and deep offshore oil.
about.bnef.com/blog/covid-19-…
3) With wind & solar power so cheap, the issue is not making them cheaper. Focus on structural issues that could hold back deep RE penetration into grids: interconnections, storage, smart charging, demand response and electrification of heating & industry. about.bnef.com/blog/covid-19-…
Another idea: buy down the closure of aging fossil fuel plants – but only on condition that they are replaced with renewable-plus-battery combinations, not just as largesse for shareholders of assets that would anyway soon be stranded.
about.bnef.com/blog/covid-19-…
4) Energy efficiency. You should mend your roof when the sun shines and insulate your building stock when there is excess capacity in the construction industry. But low energy prices will reduce the economic incentives, so we need a policy-led approach.
about.bnef.com/blog/covid-19-…
And we must think about equity! The Great Covid-19 Recession might wipe $15 to $20 trillion off U.S. household wealth over the coming 2 years. If the bottom 50% are disproportionately hit, the backlash could make France’s “yellow vest” protests look tame. about.bnef.com/blog/covid-19-…
For all the extreme uncertainty today, one thing we do know: the Covid-19 pandemic will pass. Many of the new forms of behavior we are now adopting through necessity are going to prove sticky – and will act as powerful long-term brakes on emission growth.
about.bnef.com/blog/covid-19-…
We are seeing massive new demand for home-schooling, homeworking, video-conferencing, remote medicine, online shopping, grocery deliveries, etc. Expect to see incredible changes in technology, business models, policy, behaviour and norms. Hold your hats!
about.bnef.com/blog/covid-19-…
Hard to think of a sector that won't see changes, all tending to reduce emissions: supply chains will be shorter; uptake of 3-D printing will be accelerating; countries dependent on tourism will be diversifying; food security will be moving up the agenda.
about.bnef.com/blog/covid-19-…
With streets emptied of vehicles, what's to stop temporary diversion of road space to pedestrians & cyclists? And as we spend more time in and around our homes, won’t we demand our streets be more pleasant, our parks better-maintained, our air cleaner?
about.bnef.com/blog/covid-19-…
Covid-19 should also make us think about resilience. We've had a great few decades, but we've been complacent. Maybe now we'll pay more attention to those urging us to respect our planetary boundaries, and a bit less to those pretending they do not exist?
about.bnef.com/blog/covid-19-…
In summary: Covid-19 is causing a >20% drop in emissions this quarter; they will remain down until we have a vaccine, and probably a few more years while the economy recovers. Longer term, the crisis will accelerate the transition to a low-carbon economy.
about.bnef.com/blog/covid-19-…
Also: #COP26 needs to be postponed. It is simply facing too many headwinds, in particular insufficient time to complete preparatory work, all governments distracted, and uncertainty as to whether the next U.S. President will be supportive or destructive.
about.bnef.com/blog/covid-19-…
It was certainly correct to push back the Tokyo Olympics. As an Olympian I feel for the athletes who have sacrificed so much to compete this year. But, when this is all over we will be able, like Dante Alighieri, to “leave hell and again behold the stars.”
about.bnef.com/blog/covid-19-…
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Michael Liebreich
@MLiebreich
@AukeHoekstra Here's how I frame the question. This is the past: as long as emissions and pollution are free  and clean energy technologies are expensive, the energy sector optimised around a heavily centralized, fossil-based system.
@AukeHoekstra This is the future: clean energy is super-cheap, the sources of flexibility you list have scaled up and are cheap, and there is no longer a "moat" surrounding fossil fuels. It's game over, clean energy wins. But this future is not now, or next year; it might be 2030 or even 2050.
@AukeHoekstra And this is today. Now that we know about the costs of fossil fuel pollution and emissions, a more distributed and cleaner system would clearly have higher utility, but we are stuck at a "local optimum". Jumping costs money, waiting costs utility. So there are real tradeoffs.
Read 3 tweets
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Michael Liebreich
@MLiebreich
After 2 days of negotiation, G20 finance ministers agree that "the FSB is examining the financial stability implications of climate change." At the G20 Energy Ministerial in Argentina, we did no work on energy, just discussed the communiqué. US leadership.
uk.mobile.reuters.com/article/amp/id…
Since you ask, I suspect the Financial Stability Board will conclude climate change poses little systemic financial risk. 1) Per IMF, an individual climate disaster may wipe 0.4% off GDP growth for the countries affected for one year. Globally modest compared to Coronavirus.
2) The catastrophic physical risks - multiple disasters in one year, disasters that span whole continents are not likely for several (or many) decades. I know that's not the @ExtinctionR line, but it's what the @IPCC_CH says and it's also my reading of the science.
Read 11 tweets
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Michael Liebreich
@MLiebreich
Happy holidays everyone! I wish you much joy over the holidays, and some wonderful time with your families. The news can be pretty bleak, but there is much to be (guardedly) optimistic about as we enter the new decade. If you have a moment, read on...
about.bnef.com/blog/peak-emis…
Peak emissions are closer than you think. The new decade will be, to paraphrase Winston Churchill, a decade of consequences. Play it right, and we have a chance of avoiding the worst impacts of climate change. Waste it, and we are in uncharted territory. about.bnef.com/blog/peak-emis…
Just to be clear, we will not see the sort of emissions decline by 2030 demanded by the Intergovernmental Panel on Climate Change – a 20% cut by 2030 to keep temperature rises to 2C, 45% cut to remain under 1.5C – but I would guess at a drop of around 5%.
about.bnef.com/blog/peak-emis…
Read 87 tweets

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François Gemenne
@Gemenne
We often hear it said, in certain circles, that the current #COVIDー19 crisis would be "good for the climate and the environment," or that we ought "to apply the same measures against climate change." Here is why I think this is wrong. 1/..
Not only is this utterly insensitive to the ordeal many families are living through right now, not to mention the staff on the front line, but it's also completely wrong and stupid. On the contrary, I think that in the long run this crisis will be a disaster for the #climate. 2/
Of course there are short-term effects on the environment: a substantial drop in air pollution, a fall in greenhouse gas emissions, etc. But in the long term, these temporary effects will probably be insignificant, and here's why: 3/..
Read 14 tweets
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LOrion
@LOrion
MAR 23 #COVIDー19 #MDTHREAD 1: Most stories from WaPo tinyurl.com/r8uqf9b .. but not all. Two Today on #MAGA #Trumps preferred Treatment ( it usually kills faster than COVID) and Are you Immune if recover? FIRST NUMBERS 351,731 Deaths 15,374
MAR 23 #COVID19 #MDTHREAD 2: and here is link to yest thread on Thread Reader tinyurl.com/yx43ru4p .. with piece on #Croatia Earthquake. Sharing #London #Volunteer .. do consider Meals need delivery, patients in #FieldHospitals need moving. WASH YOUR HANDS Wear gloves outside
MAR 23 #COVIDー19 #MDTHREAD 3: @Surgeon_General begged Americans to #stayhome while warning that the situation is “going to get bad” in the coming days — #Trump seemed to suggest that containment measures may be too extreme... ? Calls for #MAGA revolt? PICK YOUR POISON..
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Moritz Kuhn
@kuhnmo
@christianbaye13 & me have been thinking about the big differences in mortality rates so far during the corona outbreak in Europe. The differences in case-fatality rates are humongous. Italy has one of 6% while countries like Norway, Denmark & Germany have rates still close to 0.
Of course the rates will likely converge somewhat over time as the virus spreads and there are many effects in this. Division bias may play a role, as does the time since the outbreak.
However, we thought maybe there is something to learn in this in order to help to organize our lives in a way to minimize the risks for us and we pose to others. We picked up a striking data difference that @AndreasShrugged pointed out.
Read 23 tweets
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Matt Hannon
@hannon_matthew
*THREAD*

No time to read @ITIFdc report of UK clean #energy #innovation performance but want to know how the UK performed?

www2.itif.org/2019-global-en…

@beisgovuk @ScotGovEnergy @EnergySysCat @theCCCuk
@ITIFdc @beisgovuk @ScotGovEnergy @EnergySysCat @theCCCuk UK just makes top 10, performing best on 'social legitimation' (i.e. making clean energy more acceptable).

Does well too on 'option generation' (i.e. scale & diversity of clean energy RD&D funding).

Poorest on 'scale-up' (i.e. later stage demonstration & commercialisation).
@ITIFdc @beisgovuk @ScotGovEnergy @EnergySysCat @theCCCuk UK has done extremely well on growing its RD&D spend, ranking 1st of all the @MICleanEnergyRD countries. Kudos to @beisgovuk and its Industrial Strategy spending, which I imagine has been the primary driver.
Read 8 tweets
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UKERC
@UKERCHQ
We have just published our Review of Energy Policy: 2018!
Check out the thread below for a summary of all our recommendations.
Read the review in full here: bit.ly/2BsqDqf
On #Transport: The target for phasing our conventionally fuelled vehicles is inadequate. The @transportgovuk ‘Road to Zero’ (‘ICE ban 2040’) may neither hit the target nor make the early gains needed for a 1.5°C trajectory. @_chris_brand_ @jillian_anable
On #electricity: policy should build on Electricity Market Reform that has worked well & adapt in the light of technology/cost changes. Change in ‘black start’ incentives & other ancillary services are needed to ensure the system remains resilient @energyukcomms @ngcontrolroom
Read 9 tweets
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JesseJenkins
@JesseJenkins
Why do we keep falling short on #carbon pricing? (And what to do about it)

A thread on how policy can accelerate the pace of progress towards a low-carbon #energy system commensurate with the threat posed by #climatechange...
Putting a price on carbon.

The IPCC report on holding global warming to 1.5°C released Sunday calls for it. A share of the Nobel in Economics was awarded to William Nordhaus this week for championing it. It's arguably the most efficient and powerful climate policy available.
So why do governments around the world keep falling short on carbon pricing, and how can break this logjam? I discussed these challenges with the @NYTimes @BradPlumer in an article appearing in yesterday's paper. nytimes.com/2018/10/08/cli…
Read 27 tweets

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