When Rahm Emanuel famously advised not to let another “crisis go to waste,” he lamented that the oil crises of the 1970s came and went without solving our energy woes. As the incoming chief of staff amid the 2008 financial crisis, Emanuel foresaw “an opportunity to do things that you think you could not do before” in clean energy and beyond. That crisis too passed with too little accomplished.
Now a new crisis has arisen. Energy is merely on the periphery this time. Combatting the coronavirus and protecting human lives must be job one. I write these words from a college campus where classrooms are closed for the semester and want nothing more than for students and everyone else to stay safe and well.
I’ll leave it to medical experts to address the health crisis at hand. But those of us in the environmental arena can ponder how recent developments shift the policy landscape for the climate crisis that will remain long after the coronavirus crisis has abated.
First, it’s important not to take the wrong lessons from current events. Emissions will likely dip this year. As China battled the coronavirus, its emissions fell by a quarter. Globally, fewer flights and cruises mean less jet and marine fuels are burned. American energy use will likely decline too as more people stay home.
That mirage of falling emissions shouldn’t let us mistake recession as a solution to climate change. We want economies to be strong for everyone’s sake and to invest in a cleaner tomorrow. Every previous downturn has been followed by a rebound in global emissions. This year’s dip won’t cure our long-term emissions trajectory if we let another crisis go to waste.
Opportunities emerging from the current crisis arise from three main jolts — historically low-interest rates, plunging oil prices, and looming job losses. I’m no market guru, so I can’t foretell whether these will persist. But if they do, they’ll open opportunities to do what has not been done before.
Low-interest rates make it cheaper to invest in clean energy infrastructure. That includes solar and wind farms; transmission lines linking them to cities; charging stations for electric cars; and pipelines to move captured carbon dioxide underground and hydrogen and advanced biofuels to consumers. Building all of these would create lots of blue-collar jobs when the economy may need them most.
Meanwhile, cheap oil could reverberate through other energy markets in counterintuitive ways. Today’s glut of natural gas comes largely as a byproduct of the oil boom. That’s because natural gas bubbles up alongside more lucrative oil. Drillers have been dumping it onto markets at astonishingly low prices.
Burning cheap natural gas for electricity is better than flares or leaks. But it has also warped electricity markets, for better and for worse. Coal use has plunged, bringing welcome relief from its pollution. Even as wind and solar power have grown, they’d probably grow faster without cheap natural gas throttling wholesale power prices. Meanwhile, low power prices have pushed nuclear plants to the brink of closure, threatening their carbon-free electricity.
If a slowdown in oil drilling curbs natural gas too, its price could quickly rebound. Although hundreds of coal plants have closed, hundreds more remain open, many operating with lots of capacity to spare. That leaves a lot of slack to ramp up coal burning as prices rebound, hurting air quality and climate. Closing them while building new clean energy capacity and infrastructure with low-interest loans could avert that risk.
As oil companies struggle, their expertise could be put to better use. The technology needed for offshore drilling platforms could be used for offshore wind too. Horizontal drilling technologies used in fracking could tap geothermal energy too.
Of course, Congress should reject calls from oil tycoons to further subsidize their polluting industry. But if help is deemed necessary for other industries like airlines, it should be paired with progress on emissions as in the automobile bailouts of the last crisis.
The emerging conditions that favor these paths will disfavor some others. Cheap oil will make electric vehicles a tougher sell, so subsidies will lure fewer buyers. The case for subsidizing old-fashioned biofuels will also wane.
But low-interest rates can help us invest in-vehicle charging infrastructure and research to make electric vehicles and advanced biofuels more attractive later. Meanwhile, some form of carbon pricing perennially makes sense to push us toward net-zero emissions.
Previous crises have come and gone with emissions remaining far too high. Capitalizing on emerging opportunities this time could help us begin to bend that curve.
Daniel Cohan is an associate professor in the Department of Civil and Environmental Engineering at Rice University. The author’s views are his own.