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Clean Energy’s Jobs And Sustainability Must Anchor A Green Recovery


If the dramatic economic implications of COVID-19 have taught us anything in the present, it is that in the aftermath of the pandemic we need to shape a new narrative for the future.

The crisis has super-charged the imperative to green our economies, pushing fossil fuel markets to the breaking point but also reinforcing convictions that our best chance of recovering is by prioritizing clean, zero-carbon energy.

It has done much more than remind us that tackling climate change is essential for business – it has shifted our focus from the short-term costs of the energy transition to the overall “system value” underpinning what’s being called the “Great Reset.”

This new impetus will judge how technologies, such as renewables, hydrogen and nuclear, holistically impact:

greenhouse gas (GHG) emissions, water footprints, air quality, health, job creation and resilience — strengthened by hard evidence.

At the heart of such a vision is employment, because scaling-up clean, efficient energy could create thousands of jobs within a short period.

Early data from the Industry Action Group created by the World Economic Forum (the Forum) reveals the ambitious potential of a green recovery. Led by Vestas CEO Henrik Andersen – a champion of system value – and supported by Accenture

ACN
, its research shows that a green recovery and power market reform in Europe could create 1.8 million jobs by 2030 and cut greenhouse gas emissions by 71%.

The Forum’s group’s work covers a wide range of system-value drivers, but energy-efficiency measures alone – with €2.5 billion European Union (EU) investment – could create 480,000 jobs by 2030. Similarly, the International Energy Agency (IEA) notes its $3 trillion green recovery plan could create 1.9 million jobs a year through energy efficiency.

Europe – A Green Giant

Europe, a clean energy pioneer, is well placed to lead us into a sustainable new era.

The IEA found that at the start of lockdown renewables made up 45% of European electricity generation due to reduced demand and a shift in load away from peak hours– conditions that can be recreated through efficiency measures.

The EU pledges to put sustainability at the center of recovery to complement its ambitious Green Deal – a roadmap to a clean, circular economy. European governments are stepping up, pledging to be flexible about commissioning deadlines for wind projects and extending auction dates. The European Bank for Reconstruction and Development aims to be a majority green bank by 2025.

This investment will be important for European industrial clusters.  They provide 54 million jobs and generate 20% of emissions, such as Humber in the U.K., and are uniquely placed to jump start the hydrogen economy.

An end of the lockdown puts the continent at a threshold, offering businesses playing catch up in digital innovation with their American and Asian competitors an historic opportunity to close the gap by embracing technologies that will be the hallmark of our zero-carbon future.

Research shows European executives see the need to accelerate digital investment clearly and believe they will be more competitive vis-a-vis the U.S. and China than before the crisis.

They have a distinct green advantage: the continent’s purpose-driven consumers, who are redefining “responsible consumption” to prioritize environmental values. Nearly two-thirds (62%) of European business leaders see opportunities to build on their commitment.

But farther afield, countries and regions at different stages of their low-carbon journeys must also go green to kick-start growth.

The Forum estimates that, by 2025 building renewable energy zones in India to add utility-scale wind and solar power would create 52,000 jobs and yield $14 billion in health benefits. In the U.S., green transmission infrastructure investment could generate 110,000 jobs per year.

Utilities And Collaboration

However, a zero-carbon recovery is only possible through collaboration.

The focus on power generation and infrastructure, efficiency and decarbonization compels energy utilities to work with governments, companies, landowners and other stakeholders.

As key players in the energy value chain, utilities have a unique responsibility – backed by an array of public policies – to lead the energy transition in key areas.

Britain shows it is possible to provide electricity without coal and America’s Southwest Power Market has made huge strides in replacing coal and gas with wind – cutting prices in the process. South Korea learned from the boost given to its recovery in 2008 by ploughing 80% of stimulus spending into climate policies – and this time is allocating $185 million to ­solar subsidies.

According to BloombergNEF, with the right policies, investment in clean hydrogen could cut emissions by 34%. And networks to recharge electric vehicles must go mainstream – in China, it is the power utilities that are driving change.

 Renewed efforts by cities in energy efficiency and demand optimization could yield emission reductions and new jobs through retrofitting buildings to make them smart, electrifying heating and transport systems, upgrading distribution networks, and developing self-generation options like rooftop solar.

At the same time, grids must be transformed to modernize ageing networks not designed for variable renewables and distribution-connected resources.

Seen through the lens of system value, for example, transmission investment in the U.S. will not only create jobs, but will also slash emissions, and grid investment in India would help it achieve its 275 GW renewables target by 2027.

Time Is Of The Essence

But to capitalize on these opportunities, we must act quickly in the face of significant pressures.

Energy consumption and production contribute to two-thirds of global emissions and time is running out to meet the Paris climate change goals.

In the past five years, the energy transition has stagnated – 81% of the global energy system is still based on fossil fuels, the same percentage as 30 years ago.

The Forum’s Energy Transition Index, which ranks 115 economies on how well they balance energy security and access with environmental sustainability and affordability, shows the biggest challenge to transition remains a lack of readiness among large emitters.

Moreover, the economic impact of COVID-19 threatens existing plans to cut emissions in countries like China, the largest GHG producer and the country with the largest population, risking progress towards reaching its Paris targets.

Other challenges include the IEA’s prediction  of a 13% drop in new installed renewables capacity this year as a result of the pandemic.  And Bloomberg warns stimulus funds are not being targeted at sustainable change, calculating green measures account for less than 0.2% of COVID-19-­related stimulus spending.

All these barriers can be overcome, however. But we must remember that the mantra that sustainability and economic progress go hand in hand can no longer remain just rhetoric – because this recovery offers an unmissable chance to deliver both.

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