Coronavirus Lockdowns Clear the Air, but the Green Effect Could Be Fleeting
April 05 2020 - 10:29AM
Dow Jones News
By Stuart Condie
SYDNEY -- The Los Angeles smog has lifted, water in Venice's
canals has cleared and China's factory emissions have fallen so
dramatically the change can be seen from space.
International travel restrictions and city lockdowns designed to
slow the spread of coronavirus have led to swift and sometimes
surprising environmental benefits. The long-term implications are
unclear but many climate scientists now expect greenhouse gas
emissions to fall for the first time since the financial crisis
more than a decade ago, when they dropped by 7%.
"I expect a bigger impact than the great recession of the late
2000s or early 2010s and a drop, perhaps several percent, in global
carbon emissions," said Michael E. Mann, Distinguished Professor of
Atmospheric Science at Penn State.
In the U.S., more than three-quarters of annual greenhouse gases
are produced by transportation, industry and power generation --
three sectors hit hard as many governments around the world have
tried to stem the spread of infection by shutting down swaths of
their economies.
Transport has been badly disrupted as airlines ground empty
aircraft and commuters stay off the road. Australian carrier Qantas
Airways Ltd. canceled all international flights from late March
through to the end of May. More than 30 states have ordered
residents to stay at home except for essential activities, clearing
millions of people from the country's streets.
The crisis is also tamping down industrial activity, such as
auto manufacturing. General Motors Co., Ford Motor Co. and Fiat
Chrysler Automobiles NV have shut down assembly lines in the U.S.,
Mexico and Canada to limit the spread of the coronavirus. Honda
Motor Co. and Toyota Motor Corp. also suspended their North
American production.
A decade ago, emissions rebounded sharply as governments rolled
out economic stimulus packages that often focused on infrastructure
and heavy industry. Within two years, global emissions had
surpassed their 2008 peak. Climate scientists worry that history
will repeat itself as restrictions on movement ease and governments
and central banks inject money into their economies to hasten their
recovery.
"There are a lot of scenarios where coronavirus could make
things worse, " said Rob Jackson, an environmental scientist at
Stanford University who chairs the Global Carbon Project. "That's
the nightmare scenario for me: when the coronavirus leads to a
global recession and in response we set aside the kinds of climate
action and fuel-efficiency measures that would have happened
without it."
Workers who lose their jobs won't have cash to buy
more-energy-efficient goods, such as washing machines or electric
cars. Tesla Inc.'s share price has reflected those concerns, and is
down more than 40% since Feb. 19.
"A lot of people may not be able to afford any new car, or even
a secondhand car," Prof. Jackson said.
Government responses to industry requests for financial
assistance could signal how quickly and by how much emissions snap
back, scientists say.
Boeing Co., a major manufacturer and the largest U.S. exporter,
would have access to $17 billion in loans and loan guarantees as
part of the $2 trillion stimulus package hammered out by the White
House and lawmakers. While the measure imposed limits on stock
buybacks and dividends for airlines and other companies, it didn't
include requirements sought by eight Senate Democrats that
recipients reduce greenhouse gas emissions over time.
Carbon emissions dropped when the global economy contracted 1.7%
in 2009, only to surge to a record nine billion tons in 2010 as
growth resumed.
"The consensus is for economic activity to eventually return to
normal together with the associated levels of greenhouse gas
emissions," said Mike Wilkins, S&P Global Ratings' head of
research and analytics for sustainable finance. So, measures to
decarbonize the economy, such as a shift away from fossil fuels,
will still be required to meet targets set under the Paris climate
agreement.
That could prove tough. Governments that take on big debts to
steer their economies through the virus crisis could later find it
hard to justify spending on clean energy technologies, such as
carbon capture and storage. Advocates for any kind of
environmentally driven stimulus may also need to dial back some of
their ambition if measures are to be enacted quickly enough to save
jobs and growth, said Zoe Whitton, Citi's head of environmental,
social and governance research.
"It would be a tragedy if we decided we wanted growth to be
green and then ended up not being able to have the human recovery
we wanted because we spent so long negotiating," Ms. Whitton
said.
Consumers and businesses could again lead change. People may
give up their commutes willingly, after becoming used to working
from home and communicating with colleagues via videoconferencing
platforms. Companies may also accelerate a trend of requiring
employees to share desks.
Stanford's Prof. Jackson is skeptical this would make much
difference. "If the past is any guide, the emissions decline won't
be substantial or long-lived," he said.
(END) Dow Jones Newswires
April 05, 2020 10:14 ET (14:14 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Tesla (NASDAQ:TSLA)
Historical Stock Chart
From Aug 2024 to Sep 2024
Tesla (NASDAQ:TSLA)
Historical Stock Chart
From Sep 2023 to Sep 2024