Building back better: post-pandemic community resilience
With COVID-19 having a huge impact on communities around the world, will our basic instinct to stay safe have a lasting effect on our energy consumption choices? Jennifer Layke, Global Director for Energy at the World Resources Institute (WRI), explores the societal impact of the pandemic and how governments and policymakers should be taking a community-level approach to building smarter systems for the future.
With the pandemic seeing billions of people confined at home, Jennifer discusses why individuals should rethink their consumption habits following COVID-19 and how we can work together in order to accelerate the transition towards a clean energy future. This includes investing in clean energy solutions, such as electric vehicle charging stations and upgrading energy efficiency within the public sector.
JENNIFER LAYKE It’s impacting society in an extremely holistic way. We know that for many people, the kind of transportation they use has been impacted, the kind of energy that they have and their resiliency has been impacted, and the food systems and food supplies have been impacted. So I don’t think there’s one aspect of our lives that has not had some impact associated with COVID-19.
JENNIFER LAYKE Yes, I think certainly there are regional differences as well as socioeconomic differences inside any country. The vulnerability of people is not just by what country they live in but what their socioeconomic status is in that country. Just to give you one example, here in the US we had a report out last week that energy jobs in the clean energy sector were down nearly 600,000 people. So you could argue that for many people this is an absolutely critical economic crisis. You also know that in the instances of people who are used to being able to do energy efficiency upgrades, for example, in a building, they don’t have access to those buildings right now because of the health concerns and because we don’t want to be bringing people into buildings where they could inadvertently come in contact with the virus. So there is the need for self-preservation, for social distancing, and work as we have known it in some instances cannot continue under these circumstances. And yet, we also know that the economic impact is very real. In many places, including in many areas of the US as well as other places, your global food supply chains are being disrupted, and that is also meaning that farmers are not getting their products to market, and that will have a spillover effect to food security and the ability to deliver food to people who are living in cities far away from these farms and facilities that could be processing food today.
JENNIFER LAYKE Yes. Well, the transportation sector is going to be an interesting one to watch. My colleagues here at WRI, who work specifically on public transportation have articulated first of all the significant economic losses that most of the transit systems that we’ve been involved with have seen in terms of economic impacts. Transit ridership, for example, in the US is down 50% to 90%, but it still serves essential workers, and that’s pretty important. San Francisco’s system, their Bay Area Rapid Transit system reports losing $55 million a month. So we know that the economics of having public transportation decrease so dramatically is going to cause an economic ripple effect. But of course, it’s more than just the economics. Right now, we’ve articulated there are three stages. First of all, we know that the distancing impact means that people are not riding on public transit, but then as people come back to work, the question is, will they opt for public transit? And if they don’t opt for public transit and instead just start moving towards individualized fossil fuel-driven vehicles, we could have a huge bounce back in terms of our air emissions and climate change-related emissions and impacts. So the question I think facing public transit agencies is how to reopen safely and how to bring people back in to public transportation? I noted over the weekend that in many places, biking is going to have a significant, and what we call micromobility has a significant boost under a scenario where people want individualized transportation and they’re not opting for fossil fuel-based cars. So I think that we’re looking at the need to reinforce forms of public transportation that can be safe, and ensure that we have many mobility options that will allow people to avoid the need for single individuals in single cars.
JENNIFER LAYKE I think we’ll see a mixed response. I wish I could be fully optimistic that we are seeing a significant and lasting shift in people’s behaviour. However, I do think that fear has the likely impact that people will be concerned about how to engage safely, which is why that’s such a priority. I also am cautious about where and how government stimulus packages and government investment programmes could inadvertently re-engage a public that would otherwise be likely to move towards alternative transportation modes, and because of stimulus dollars, invest in the wrong type of response. So we’ve been at WRI trying to look at a build back better approach, and in doing so, highlighting the need for governments not to turn to the industries of the past and the technologies of the past, which policymakers may feel are attractive investments because they have done these types of investments before, and instead, how do we encourage investment into modern, new, clean technologies that don’t have the same negative externalities in terms of traffic or in terms of air pollution or other types of health impacts. And just one note on the challenges that we’re facing that are around climate. We know that for many communities, and there are increasingly a number of studies coming out showing that those people who live in the worst-polluted areas are also likely to be those that may experience the worst symptoms of COVID-19 or another type of disease, because their systems are weakened through the pollution that they’re exposed to on a daily basis. And that is something we ought to take very seriously as we look at our investments into stimulus programmes and other types of investment strategies, coming out of this economic crisis.
JENNIFER LAYKE What we need to do is build a system that allows us to, first, look for health and economic benefits that can go hand in hand, and make those our priorities. Second, we need to really focus in on ensuring that we’re looking to the future of technology, whether you’re an individual company investing in new equipment that would allow you to be more productive with stimulus dollars, or whether you’re thinking as a government about how do you go in and support the communities that need new housing or new health centres. How do you ensure that you’re not building the technologies of yesterday, instead of focusing on building into the smarter systems of tomorrow?
JENNIFER LAYKE I am quite convinced that this is going to be the decade where the learnings and lessons from our last year of climate impacts and this year’s COVID-19 impacts can really point us to a different energy trajectory. The fires in Australia, the fires in California last year really did tap into this question associated with, one, how do we quickly reduce the amount of fossil fuel emissions that are going in to create and drive a climate emergency, and secondly, how do we build more energy security and energy independence using renewable energy and energy efficiency as our primary fuels. And I think that is a critical question that any government needs to focus on today. The opportunities to build back better in the energy sector are significant, and they range. We could imagine a scenario where rooftops in single family homes have their own solar technologies with a backup battery, and in California we saw people scrambling to try and find diesel generators to keep their medication refrigerated, and that’s in California, one of the richest states and countries in the world. So we know that this opportunity to improve one’s resilience can be linked to the ability to produce and save your own energy, use your own energy sources. Secondly, we also need to really focus on how we do energy efficiency better. And that is part of what we would look at as a critical investment in the stimulus dollars in the US in particular. We know that in the economic downturn of 2008 and the Great Recession that that was one of the top priority areas using energy efficiency stimulus dollars. It jumpstarted the kind of reinvestment in US manufacturing, allowed for people to have secure local jobs, and built a much more productive manufacturing base because every unit of energy produced more goods and services.
JENNIFER LAYKE I certainly think that for communities that have been impacted by either the COVID-19 crisis or by these climate-related emergency crises, we are going to continue to see people looking for ways that they can protect their families. But I also want to recognise the role that policy has in this and how critical it is, the leading by example, the type of institutions that we need to help build back this response and the kind of investment that’s required. We certainly know that it’s going to take more than simply the availability of electric vehicles to build out a transition in the transportation space. We know that you have to have an alternative to a personal vehicle. And so, those are public policy decisions. Those are critical decisions to make. I do want to recognize that at any point that we’re asking institutions to change, it is always with some impacts, and we have to manage those impacts. So, if you are in the United States and you’ve been affected by the phase-down of coal, as a policymaker you need to know how you’re going to help people to create an alternative pathway. We have seen in the United States and around the world the price of oil drop dramatically. This is incredibly important opportunity to reduce the types of current tax subsidies and other types of fossil fuel-related subsidies that our governments have put in place. We can eliminate those subsidies now and there will be very little economic impact on those industries because in fact we can have the opportunity to transition them and to work on a just transition strategy to begin our phase-out of oil, in particular in the transportation sector, but also in the petrochemical industry and in others.
JENNIFER LAYKE I certainly think that this is the role of public policy, that it is critical that we have a transition approach, that we have planned for an orderly transition, and that we move our investment in the stimulus in to allow for that transition to happen. Right now, we have $5.2 trillion in annual subsidies, tax breaks, and uncharged external impacts from air pollution and climate. That’s an OECD number that we’ve known for a number of years. And yet the rest of us pay significantly for those subsidies which have artificially allowed the industry to compete and to experience significant demand on the backs of our health. And that equation must change, but it doesn’t come without some careful planning and careful investment in order to allow that to occur. And so this is the moment where we’re building back, where we’re reinvesting in our economies to look to the economy of the future, not to the economy of the past.
JENNIFER LAYKE I think that there is. And in fact, most of the polling around the world shows that people would prefer to have clean energy resources, that they would prefer to be able to have more localized energy systems that are connected to a grid for resiliency purposes, but that those things can go hand in hand. I just wanted to note that right now we’ve seen the wake of COVID-19 have a 40% reduction in expectations around electric vehicles sales, and that we have the ability to shift using public policy and using incentives and stimulus dollars. So we’d need to be looking carefully at, if we are going to invest, where we are going to invest. And things like electric vehicles can both reduce air pollution locally and help with the global climate burden of transportation.
JENNIFER LAYKE Well, one statistic that stood out for me from the International Renewable Energy Agency’s 2020 Global Renewables Outlook which was published a few weeks ago, just a few weeks ago, they had estimated that in their review, that clean energy economic yields were three to eight times higher than the initial investment put in place. And that’s a significant figure. So, the type of investments that we make in energy can actually help to jumpstart economic growth and economic benefits for people around the world, although in their deeper decarbonization scenario it outlined a net zero world, and that cost would be between $35 and $45 trillion. But the benefits and savings that it yielded was $62 to $169 trillion. So that’s three to eight times higher benefits than there were initial costs. And that’s the kind of figure that is very compelling when you look at something where we say, today we’re in a crisis, and we know that there will be crises in the future, how do we best navigate for society to come out more resilient and stronger, even in light of these types of challenges. Looking at energy efficiency and renewable energy provides a clear pathway to a better economic outcome, as well as to better health and climate outcomes.