With lockdowns in place practically all over the world, the peak of the pandemic has morphed into a sort of vast air pollution control experiment, especially in major urban areas, whose very tangible public health benefits will certainly be short-lived and are still difficult to quantify but, in any case, point to an abnormal and clearly unsustainable “remedy”. Nevertheless, there is a considerable overlap between post-pandemic measures and environmental protection efforts. An example is the current increase in sensitivity to deforestation, which surely contributed to the biological origins of Covid-19; a second aspect is precisely local air quality as a factor that very possibly aggravated the health effects of the virus.
As always, the practical decisions and measures aimed at fostering the energy transition and the adoption of new production models carry significant political weight, given the economic interests at stake, resulting geopolitical repercussions and even impact on lifestyles.
The ideological rupture between the two political parties in the United States is very clear when it comes to environmental policies but, fortunately, much more limited when it comes to the risk of future epidemics. Meanwhile, the new push toward the development of “smart” work models – certainly less costly in terms of energy – may lead to a broad coalition that embraces both business and work worlds and supporters of the energy transition. Investors will be more likely than they were in the past to select opportunities from among those of the vast “green” agenda. The collapse of oil prices could generate some temporary obstacles on the energy source front but, in reality, is a reflection of the increasing structural instability of the fossil fuel sector, the fragility of the American shale gas & oil industry and the appeal of renewable sources.
There are structural changes under way with the substantial drop in the cost of renewables, starting with coal for generating electricity. De-carbonization is being driven by affordability and leading to the gradual electrification of activities traditionally dependent on other energy sources; heating and transportation are good examples. The fact remains, however, that industrial plants, buildings and transportation are in need of a deep transformation. Thus, the various stimulus packages to be launched over the coming months could be decisive in steering choices. One of the main obstacles thus far has been concern over potential job losses. This is a false dichotomy in industrial terms, since the energy transition offer a more stable and sustainable source of employment than are many traditional industries.
As we are already seeing in China, mobility has been the primary (CO2-intense) activity to resume on a broad scale since the pandemic restrictions were lifted, and is therefore an important area on which to intervene if the “carbon footprint” is to be reduced, particularly in major urban areas.
Europe’s Recovery Fund is an opportunity to not only jumpstart existing projects and sectors, but also to trigger a paradigm shift aimed at a vast and ambitious European industrial plan that fully exploits the comparative advantages the continent already offers. The most promising sectors include storage, carbon capture and digitalization, and there is a direct link with a European Green Deal founded from the beginning on a concept of public health intended in the broadest possible sense. Additional opportunities will emerge with the shift in the direction of investment flows following the inevitable contraction in some sector such as, for example, air transportation.
A complicated, but necessary, task will be to build a global alliance on the expansion of environmental standards such as those of Europe, which account for less than 10% of global emissions; thus, much broader-based multilateral policies. It was noted that it is going to a long and bumpy road, given that the major emerging economies currently account for increased consumerism, with an energy footprint that has often surpassed that of the more advanced economies: these new producers and consumers are going to have to change their development models to allow for substantial emissions reductions, which is going to involve massive investments and probably call for widespread technology transfers.
In reality, among overall global threats, a pandemic was widely contemplated well before Covid-19, which nevertheless had a low probability of occurring. Equally indicative, however, is the fact that a much more serious and high-probability threat lies in the catastrophic and permanent effects of climate change. It is also true that freedom from fossil fuel sources has very vast geopolitical implications, especially given the link between some Middle East regimes (but not only those) and the relative stability of entire regions and major population masses. Thus, great care is going to have to go into assessing the strategic variables – and not only those strictly economic or environmental – associated with a radical transition to new energy sources.
In any case, there is greater awareness today among more economically advanced nations of the need to confront the sustainable development goals at the same time and with the same priority as post-pandemic economic recovery measures. It therefore becomes essential to agree at European level not only on amounts of resources to be made available but also on exactly how they should be used, which is going to be crucial for Italy in light of its traditional difficulty spending the resources at its disposal. Equally critical will be the intelligent management of urban area conversions, which is going to have a direct impact on the well-being of countless citizens and, consequently, on levels of political consensus – another indispensable factor in fostering a true green transition.