The impact of the coronavirus around the world and the resulting disturbance in global markets grab global attention and points to a worldwide economy. An economy that is over-reliant on fossil fuels and seriously exposed to economic crashes that could be helped by a shift to renewable energy.
According to the executive director of the Center for Climate Finance and Investment at Imperial College Business School in London, Dr. Charles Donovan- during his interview with Forbes, building a global economy based on fossil fuels makes the world more helpless to market disturbances like the one caused by the coronavirus pandemic.
Donovan said, I think we’re entering a whole new phase of volatility”. “These are the unfortunate repercussions of a global market that’s exposed to the volatility of the oil markets and suffers when unforeseeable events like coronavirus arise at the worst time.
Now, we see the downsides of the decisions we’ve made about the kind of energy economy that we have.” He recommends that rather than throwing investment at energy companies, we should prioritize developing economies that are not linked to oil and gas. Also, Donovan emphasized that renewable energy sources like wind, solar, and tidal power may interest investors and policymakers more than fossil fuels on an entire economic basis.
Here’s another factor in Donovan’s outlook in support of the renewables. They are viewed as being more resistant to monopolization by cartels and manipulation (like OPEC), which means they are more difficult to manipulate (or fight wars over). Donovan also states that monetary policy has a historical bias toward fossil fuels when central banks pumped trillions of dollars into the markets in a failed attempt to calm investors.
He also stressed that this is a crucial point now where policymakers can guarantee that this round of easing is not hugely biased towards having oil producers on a lifeline. Instead, bailouts could be structured around a strategy of decarbonization and preparing countries for low-carbon transitions. The interventions should be targeted towards initial investments and retraining for people in industries that can no longer keep performing..
He explains that the process of developing low-carbon infrastructure is unlikely to stand unexpected disruptions such as the one created by the coronavirus. Over time, such economies could sustain a more durable, sustainable energy.
“It’s not that by having more wind turbines and solar panels, we could avoid coronavirus. Donovan said, but the world’s economy has been like the frog in a pan of water that’s slowly warming up. The fire has just been turned up several notches, and the only thing we can do now is jumping out of the pan. This is about building an energy infrastructure that creates resilience.”
Pandemic like corona, war, contaminated groundwater, suppurating skies, oil spills, railway fires, pipeline leaks — all of them can be avoided by using renewables in building economies. So why aren’t we doing so? It is because the fossil fuel companies have bought and paid for national governments for centuries. With this, the use of renewable energy would lower the incidence of corruption. Could that really happen? It is interesting to find out.
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