Will industry rebound?<\/h2>\n![\"\"](\"https:\/\/www.climateworks.org\/wp-content\/uploads\/2020\/12\/Global-Intelligence-Blog-Impacts-Table-1-1400x-240x300.png\")
<\/a>Throughout 2020, ClimateWorks has been tracking a number of different indicators globally and in the largest-emitting regions to understand the implications of Covid-19 on greenhouse gas emissions and climate. A few examples are included here.<\/p><\/div>\n
At the beginning of the pandemic, we saw strict lockdowns cause sharp drops in industrial production in many countries. Today, the overall outcome is still a bit murky. In China, industrial output in 2020 is now outpacing 2019, and emissions from steelmaking<\/a> in particular have risen in part due to government stimulus measures. China\u2019s economy has benefited from its relative success in controlling its Covid-19 outbreak. However, the country\u2019s public health success may be insufficient to revive its economy while major trading partners are still in recession. South Korea<\/a> and Vietnam<\/a> both fit this description and point to a continued suppression in industrial activity through the first half of 2021, at least until widespread vaccination occurs. In the long run, however, economic activity (and hence greenhouse gas emissions) will rebound, and the most consequential impact of the pandemic will be how historically large government stimulus measures will be spent.<\/p>\nOil prices trend down, clean transportation trends up<\/h2>\n
After plunging in March and April, oil markets rebounded slightly in the third quarter of 2020. While consumption has risen from its lowest point, demand remains well below historical levels, and prices continue to stagnate at less than $50 per barrel. The CEOs of BP and Shell have warned that 2019 might represent peak oil demand and some even proclaimed the\u00a0\u201cend of the oil age<\/a>.\u201d<\/p>\nLow oil prices do not seem to be slowing the global momentum toward transportation electrification, as evident through the most recent news that Qu\u00e9bec and the U.K. joined a growing number of governments<\/a>\u00a0accelerating the transition to 100% electric vehicles (EVs, including hybrids, plug-in hybrids, and full battery power).\u00a0Europe took the lead in annual EV sales globally, driving forward efforts to catch up with China. Germany finally emerged as one of the continent\u2019s hottest EV markets, and in the first seven months of 2020, Europe claimed the global EV sales lead by surpassing\u00a0China\u2019s EV sales by 14,000 units<\/a>. Despite an overall plunge<\/a> in new car sales in Europe, EV sales grew in percentage and absolute terms, accounting for 8% of all sales, double the market share compared to the same period in 2019. In July, EVs reached an all-time high of 18%<\/a> of the total European passenger car market.<\/p>\nLastly, the easing of Covid-19 restrictions led to a rebound in traffic congestion as a portion of public transit trips shifted to private vehicles due to safety concerns. This trend was also accompanied by a rise in shared and private micromobility (bicycles and e-scooters) trips, as well as a major uptick in bicycle sales across the U.S. and Europe.<\/p>\n
Government response to the crisis<\/h2>\n
Governments around the world have passed a variety of fiscal stimulus measures meant to blunt the economic impact of the recession caused by the Covid-19 pandemic. Some policy packages, such as the European Green Deal, have used this as an opportunity to build back better, making climate change mitigation one of the main priorities of their Covid-19 recovery. However, research by Vivid Economics has shown that of over\u00a0$12 trillion\u00a0spent in stimulus plans by\u00a022 countries,18\u00a0of them are expected to have\u00a0negative environmental impacts\u00a0on net. Particularly egregious were the bailouts of airlines without any environmental conditions, a major missed opportunity and a demonstration of the lobbying power of incumbent industries at the expense of the low-carbon transition.<\/p>\n
Sustaining emissions reductions after the pandemic<\/h2>\n
Global carbon dioxide emissions have been rising for\u00a0five decades. 2020 will break that trend, with emissions projected to decline\u00a0by around\u00a07% or 8%<\/a> relative to 2019 \u2014 but for all the wrong reasons. While\u00a0Covid-19\u00a0has reduced\u00a0economic production\u00a0and\u00a0personal mobility,\u00a0and thus greenhouse gas emissions, we are already seeing\u00a0emissions rebounds\u00a0in countries that have gotten the pandemic relatively under control.<\/p>\nGoing forward, we need to sustain a similar rate of emissions decline year over year for the rest of the decade to get back on track to reach the goals of the Paris Agreement, but analysts expect that emissions in 2021 will rebound. This should send a strong message that activity declines are insufficient to achieve a safe long-term climate. In order to move toward decarbonization in a post-pandemic world, we need to reduce the greenhouse gas intensity of human activities and begin to remove carbon from the atmosphere at scale in order to reach net-zero emissions by midcentury.<\/p>\n
Implications of converging crises<\/h2>\n
In addition to a health and economic crisis of epic proportions, we are still hurtling towards temperature rise in excess of 3\u00b0 C this century<\/a>, which will likely have devastating consequences for people and the planet. While climate change and global health policy have largely been treated as separate issues by the public and media up to this point, the causes of both crises share commonalities<\/a>, and their effects are converging<\/a>. For example, we are seeing that the links between climate change, air pollution, and Covid-19 are at this point indisputable. A recent study showed that an increase of only one microgram per cubic meter in PM2.5 \u2014 fine particulate matter that is released in addition to greenhouse gases when burning fossil fuels \u2014 is associated with an 8% increase<\/a> in the Covid-19 death rate. There is increasing evidence that both Covid-19 and the climate crisis disproportionately impact the poorest and most marginalized people in society, and both crises contribute to widening inequality.<\/p>\nThe warming climate will play a bigger role in future pandemics, and moving forward, we must look toward more integrated solutions in responding to converging crises. According to the 2020 U.N. Environment Programme Gap Report, a low-carbon pandemic recovery could cut 25% of greenhouse gas emissions<\/a>. Seizing this opening is critical to bridging the emissions gap. As we\u2019ve seen, reductions in activity levels and energy consumption have resulted in real reductions in emissions. However, this is a solution that offers only short-term respite. Long-run deep decarbonization beyond the pandemic requires ambitious policies<\/a> that drive emissions from our daily activities toward zero. Only then will we have a chance of meeting the Paris Agreement\u2019s long-term goal of net-zero global greenhouse gas emissions by midcentury.<\/p>\n <\/p>\n
For more information on how ClimateWorks is responding to the Covid-19 pandemic,\u00a0see here<\/a>.<\/em><\/p>\n","protected":false},"featured_media":0,"parent":0,"template":"","portfolio":[46],"yoast_head":"\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\n\n\n\n\n\t\n
<\/a>Throughout 2020, ClimateWorks has been tracking a number of different indicators globally and in the largest-emitting regions to understand the implications of Covid-19 on greenhouse gas emissions and climate. A few examples are included here.<\/p><\/div>\n
At the beginning of the pandemic, we saw strict lockdowns cause sharp drops in industrial production in many countries. Today, the overall outcome is still a bit murky. In China, industrial output in 2020 is now outpacing 2019, and emissions from steelmaking<\/a> in particular have risen in part due to government stimulus measures. China\u2019s economy has benefited from its relative success in controlling its Covid-19 outbreak. However, the country\u2019s public health success may be insufficient to revive its economy while major trading partners are still in recession. South Korea<\/a> and Vietnam<\/a> both fit this description and point to a continued suppression in industrial activity through the first half of 2021, at least until widespread vaccination occurs. In the long run, however, economic activity (and hence greenhouse gas emissions) will rebound, and the most consequential impact of the pandemic will be how historically large government stimulus measures will be spent.<\/p>\n After plunging in March and April, oil markets rebounded slightly in the third quarter of 2020. While consumption has risen from its lowest point, demand remains well below historical levels, and prices continue to stagnate at less than $50 per barrel. The CEOs of BP and Shell have warned that 2019 might represent peak oil demand and some even proclaimed the\u00a0\u201cend of the oil age<\/a>.\u201d<\/p>\n Low oil prices do not seem to be slowing the global momentum toward transportation electrification, as evident through the most recent news that Qu\u00e9bec and the U.K. joined a growing number of governments<\/a>\u00a0accelerating the transition to 100% electric vehicles (EVs, including hybrids, plug-in hybrids, and full battery power).\u00a0Europe took the lead in annual EV sales globally, driving forward efforts to catch up with China. Germany finally emerged as one of the continent\u2019s hottest EV markets, and in the first seven months of 2020, Europe claimed the global EV sales lead by surpassing\u00a0China\u2019s EV sales by 14,000 units<\/a>. Despite an overall plunge<\/a> in new car sales in Europe, EV sales grew in percentage and absolute terms, accounting for 8% of all sales, double the market share compared to the same period in 2019. In July, EVs reached an all-time high of 18%<\/a> of the total European passenger car market.<\/p>\n Lastly, the easing of Covid-19 restrictions led to a rebound in traffic congestion as a portion of public transit trips shifted to private vehicles due to safety concerns. This trend was also accompanied by a rise in shared and private micromobility (bicycles and e-scooters) trips, as well as a major uptick in bicycle sales across the U.S. and Europe.<\/p>\n Governments around the world have passed a variety of fiscal stimulus measures meant to blunt the economic impact of the recession caused by the Covid-19 pandemic. Some policy packages, such as the European Green Deal, have used this as an opportunity to build back better, making climate change mitigation one of the main priorities of their Covid-19 recovery. However, research by Vivid Economics has shown that of over\u00a0$12 trillion\u00a0spent in stimulus plans by\u00a022 countries,18\u00a0of them are expected to have\u00a0negative environmental impacts\u00a0on net. Particularly egregious were the bailouts of airlines without any environmental conditions, a major missed opportunity and a demonstration of the lobbying power of incumbent industries at the expense of the low-carbon transition.<\/p>\n Global carbon dioxide emissions have been rising for\u00a0five decades. 2020 will break that trend, with emissions projected to decline\u00a0by around\u00a07% or 8%<\/a> relative to 2019 \u2014 but for all the wrong reasons. While\u00a0Covid-19\u00a0has reduced\u00a0economic production\u00a0and\u00a0personal mobility,\u00a0and thus greenhouse gas emissions, we are already seeing\u00a0emissions rebounds\u00a0in countries that have gotten the pandemic relatively under control.<\/p>\n Going forward, we need to sustain a similar rate of emissions decline year over year for the rest of the decade to get back on track to reach the goals of the Paris Agreement, but analysts expect that emissions in 2021 will rebound. This should send a strong message that activity declines are insufficient to achieve a safe long-term climate. In order to move toward decarbonization in a post-pandemic world, we need to reduce the greenhouse gas intensity of human activities and begin to remove carbon from the atmosphere at scale in order to reach net-zero emissions by midcentury.<\/p>\n In addition to a health and economic crisis of epic proportions, we are still hurtling towards temperature rise in excess of 3\u00b0 C this century<\/a>, which will likely have devastating consequences for people and the planet. While climate change and global health policy have largely been treated as separate issues by the public and media up to this point, the causes of both crises share commonalities<\/a>, and their effects are converging<\/a>. For example, we are seeing that the links between climate change, air pollution, and Covid-19 are at this point indisputable. A recent study showed that an increase of only one microgram per cubic meter in PM2.5 \u2014 fine particulate matter that is released in addition to greenhouse gases when burning fossil fuels \u2014 is associated with an 8% increase<\/a> in the Covid-19 death rate. There is increasing evidence that both Covid-19 and the climate crisis disproportionately impact the poorest and most marginalized people in society, and both crises contribute to widening inequality.<\/p>\n The warming climate will play a bigger role in future pandemics, and moving forward, we must look toward more integrated solutions in responding to converging crises. According to the 2020 U.N. Environment Programme Gap Report, a low-carbon pandemic recovery could cut 25% of greenhouse gas emissions<\/a>. Seizing this opening is critical to bridging the emissions gap. As we\u2019ve seen, reductions in activity levels and energy consumption have resulted in real reductions in emissions. However, this is a solution that offers only short-term respite. Long-run deep decarbonization beyond the pandemic requires ambitious policies<\/a> that drive emissions from our daily activities toward zero. Only then will we have a chance of meeting the Paris Agreement\u2019s long-term goal of net-zero global greenhouse gas emissions by midcentury.<\/p>\n <\/p>\n For more information on how ClimateWorks is responding to the Covid-19 pandemic,\u00a0see here<\/a>.<\/em><\/p>\n","protected":false},"featured_media":0,"parent":0,"template":"","portfolio":[46],"yoast_head":"\n\n\n\n\n\n\n\n\n\n\n\n\t\n\t\n\n\n\n\n\n\t\nOil prices trend down, clean transportation trends up<\/h2>\n
Government response to the crisis<\/h2>\n
Sustaining emissions reductions after the pandemic<\/h2>\n
Implications of converging crises<\/h2>\n