Green recovery

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Green recovery is a widely adopted name for a proposed package of environmental, regulatory and fiscal reforms to recover prosperity after the COVID-19 pandemic. There has been broad support from political parties, governments, activists and academia across the European Union,[1] the United Kingdom,[2] the United States,[3][4] and other countries to ensure that investments to lift countries out of economic recession are spent in a way that combats climate change, including the reduction of coal, oil, and gas use, as well as the investment in clean transport, renewable energy, eco-friendly buildings, and sustainable corporate or financial practices. These initiatives are supported by the United Nations and the Organisation for Economic Co-operation and Development.[5] In July 2021, the International Energy Agency warned that only around 2% of economic bailout money worldwide was going to clean energy.[6] OECD data shows that only 17% of COVID-19 recovery investments funds have been allocated to a green recovery as of March 2021.[7]


Since the industrial revolution, the burning of coal, oil and gas has released millions of tonnes of carbon dioxide, methane, and other greenhouse gases into the atmosphere, causing global warming. By 2020, the Earth's average temperature had risen by over 1°C since pre-industrial levels. The United Nations Intergovernmental Panel on Climate Change has calculated that continuing to burn coal, oil, and gas reserves will heat the planet by between 0.8 degrees to 2.5 degrees, per 1000 gigatonnes of burning carbon[8] and there are 2900 gigatonnes of carbon in proven reserves.[9] Burning a fraction of the coal, oil, and gas reserves will therefore lead to uncontrollable planetary heating, resulting in widespread crop failures, and the 6th mass extinction event. By the end of 2019, there had been increasing incidents of wild fires in Australia, the Amazon rainforest in Brazil, and the Arctic forests in Russia,[10] as well as increased risks of hurricanes in the United States and Caribbean, and flooding. In 2015, the vast majority of countries signed the Paris Agreement committing to limit global carbon emissions to prevent temperature rises by over 2 degrees, with an ambition to limit temperature rises to 1.5 degrees. Activists and politicians, particularly younger people, have become increasingly vocal in demanding a "Green New Deal" in the US,[11] or a Green Industrial Revolution in the UK,[12] to end the use of fossil fuels in transport, energy generation, agriculture, buildings, and finance. In late 2019, the EU announced a European Green Deal, although this was said to fall far short of the goal of ending fossil fuel use in the bloc by 2050.[13]

In early 2020, the COVID-19 pandemic caused countries to lock down their economies, in order to prevent infections and deaths from the spread of the virus. This required many businesses to suspend work, as people travelled less, shopped less, and stayed at home to work more. In most countries this caused some job losses, while in the United States, the United Kingdom, and other countries with weaker labour rights, there were acutely high rises in unemployment. The fall in economic activity also caused a fall in greenhouse gas emissions.[14] This encouraged campaign groups to call for, and politicians and governments to promise, a green recovery.

As several recovery programs have been planned to combat the economic crisis, voices called for the integration of climate mitigation strategies. The implementation of green standards in recovery packages and the support of projects that foster carbon neutrality have been major claims. In this regard, green recovery has been framed as opportunity rather than burden sharing, as a sustainable recovery path does not only lead to lower emissions but can support economic growth and resilience. In earlier discourses, these positive side effects have been coined as co-benefits. According to the IPCC, co-benefits can be defined as the: “the positive effects that a policy or measure aimed at one objective might have on other objectives, irrespective of the net effect on overall social welfare".[15] Different measures can have several positive socio-economic impacts. The deployment of renewable energies can significantly boost employment and industrial development. Depending on the country and the deployment scenario, replacing coal power plants with renewable energy can more than double the number of jobs per average MW capacity.[16] Besides economic effects, climate mitigation strategies can increase socio-economic and health-related co-benefits. The deployment of solar mini-grids can improve electricity access for rural areas [17] and the replacement of coal-based energy with renewables can lower the number of premature deaths caused by air pollution.[18]

Green recovery proposals[edit]

Proposals for a green recovery vary widely according to the proponents.

In the United States, a group of academics and activists working in climate policy introduced "a green stimulus to rebuild our economy" in March 2020, which incorporated proposals from a variety of candidates in the 2020 Democratic Party presidential primaries.[4] The proposed stimulus was presented as a menu of policies targeting eight fields, housing and civic infrastructure, transportation, labor and green manufacturing, energy generation, food and agriculture, environment and green infrastructure, innovation policy, and foreign policy. Its minimum funding level was set at 4% of the US GDP, or around $850 billion a year, until the dual achievement of full decarbonization and an unemployment rate below 3.5%.[4]

In the UK, the government proposed "a green and resilient recovery," and announced £3 billion in funding for building renovations in July.[19] By contrast, in early July, an academic and think tank group proposed a "Green Recovery Act" that would target nine fields of law reform, on transport, energy generation, agriculture, fossil fuels, local government, international agreement, finance and corporate governance, employment, and investment. This has the goal of establishing duties on all public bodies and regulators to end use of all coal, oil and gas "as fast as technologically practicable," with strict exceptions if there are not yet technical alternatives.[20]

In June 2020, the German government pledged a green recovery with funding of €40 billion (£36 billion or US$45 billion) as part of a €130 billion recovery package.[21]

In July 2020 the European Council agreed to a massive recovery fund of €750 billion, branded Next Generation EU (NGEU), to support member states hit by the COVID-19 pandemic. An overall climate target of 30% will apply to the total amount of expenditure from the NGEU in compliance with the Paris climate agreement.[22]

In February 2021, commentators such as the Council on Foreign Relations noted that in addition to climate-friendly policies being enacted in the U.S. by Democratic primary winner and President Joe Biden,[23][24] other major economies such as China, India, and the European Union have also begun "implementing some of the policies envisioned by the Green New Deal." [25][26]

Over spring 2021, Biden introduced his American Jobs Plan and American Families Plan, which incorporate green recovery principles including investments in carbon capture and storage, clean energy, and a Civilian Climate Corps similar to the Civilian Conservation Corps. The plans have received criticism from progressives who view them and the rest of Biden's climate policy as not ambitious enough.[24][27][28][29]

A July 2021 update to the World Scientists' Warning to Humanity found the 17% of COVID-19 recovery investments funds that have reportedly been allocated to a green recovery as of March 2021 to be insufficient, warning that new climate policies should be part of COVID-19 recovery plans, that they also need address root causes, rather than symptoms, with system changes above politics being required and immediate, drastic reductions in greenhouse gases to be prioritized.[30][7]


The broad goal has been to recover the economy and repair the damage to the climate and environment at the same time. Economic growth is a key driver of CO2 emissions (Sathaye et al., 2007:707).[31] As the economy expands, demand for energy and energy-intensive goods increases, pushing up CO2 emissions. On the other hand, economic growth may drive technological change and increase energy efficiency. Economic growth may be associated with specialization in certain economic sectors. If specialization is in energy-intensive sectors, specifically carbon energy sources, then there will be a strong link between economic growth and emissions growth. If the specialization is in clean energy source there will be a reverse relationship (as carbon energy use reduces) between economic growth and emissions. If specialization is in less energy-intensive sectors, e.g. the services sector, then there might be a weak link between economic growth and emissions growth. Unlike technological change or energy efficiency improvements, specialization in high or low energy intensity sectors does not affect global emissions. Rather, it changes the distribution of global emissions.

Much of the literature focuses on the "environmental Kuznets curve" (EKC) hypothesis, which posits that at early stages of development, pollution per capita and GDP per capita move in the same direction. Beyond a certain income level, emissions per capita will decrease as GDP per capita increase, thus generating an inverted-U shaped relationship between GDP per capita and pollution. Sathaye et al.. (2007) concluded that the econometrics literature did not support either an optimistic interpretation of the EKC hypothesis - i.e., that the problem of emissions growth will solve itself - or a pessimistic interpretation - i.e., that economic growth is irrevocably linked to emissions growth. Instead, it was suggested that there was some degree of flexibility between economic growth and emissions growth.

Once a government has decided on the price of GHG emissions, they can take that number and use it to set tax rates for businesses (and households, if necessary).[32] Carbon taxes are considered especially useful because, once a number has been created, it will benefit the government either with currency or with a lowering in GHG emissions or even both, and therefore benefit the environment.[32] It is almost a worldwide consensus that carbon taxing is the most cost-effective method of having a substantial and rapid response to climate change and carbon emissions.[33] However, backlash to the tax includes that it could be considered regressive, as the impact from the tax would be damaging disproportionately to the poor who spend much of their income on energy for their homes.[34] Still, even with the near universal approval, there are many questions that are unanswered regarding both the collection and redistribution of the taxes. One of the central questions being how the newly collected taxes will be redistributed.[35]

Liberalization and restructuring of energy markets has occurred in several countries and regions, including Africa, the EU, Latin America, and the US. These policies have mainly been designed to increase competition in the market, but they can have a significant impact on emissions. Reform could allow the market to be more responsive to price signals placed on emissions. In 2020 it was estimated that by 2022 replacement of all existing coal-fired power stations by renewables and storage would be profitable in total but that "A key barrier to accelerating phaseout is that the vast majority (93 percent) of global coal plants are insulated from competition from renewables by long-term contracts and noncompetitive tariffs".[36]

See also[edit]


  1. ^ 'Boosting the EU's green recovery: Commission invests €1 billion in innovative clean technology projects' (3 July 2020)
  2. ^ 'Building back a green and resilient recovery' (8 July 2020) E McGaughey, M Lawrence and Common Wealth, 'The Green Recovery Act 2020', proposed UK law, and pdf
  3. ^ e.g. Tom Steyer, 'A fair, green recovery for all Californians'; New York City, COVID-19 Green Recovery.
  4. ^ a b c D. Aldana Cohen, D. Kammen, J. Brave NoiseCat, et al, A green stimulus to rebuild our economy, Medium, March 22, 2020
  5. ^ M Holder, 'OECD and UN institutions demand green economic recovery from Covid-19' (5 June 2020) Business Green
  6. ^ "Key findings – Sustainable Recovery Tracker – Analysis". IEA. Retrieved 23 July 2021.
  7. ^ a b Ripple, William J; Wolf, Christopher; Newsome, Thomas M; Gregg, Jillian W; Lenton, Timothy M; Palomo, Ignacio; Eikelboom, Jasper A J; Law, Beverly E; Huq, Saleemul; Duffy, Philip B; Rockström, Johan (28 July 2021). "World Scientists' Warning of a Climate Emergency 2021". BioScience. 71 (9): 894–898. doi:10.1093/biosci/biab079. hdl:1808/30278.
  8. ^ IPCC,, Climate Change 2014: Synthesis Report (2014) 62
  9. ^ C McGlade and P Ekins, ‘The geographical distribution of fossil fuels unused when limiting global warming to 2oC’ (2015) 517 Nature 187, Figure 1
  10. ^ F Pearce, ‘Long Shaped By Fire, Australia Enters a Perilous New Era’ (16 January 2020) YaleEnvironment360
  11. ^ e.g. Bernie Sanders, Green New Deal.
  12. ^ See Green New Deal Group, A Green New Deal (July 2008)
  13. ^ European Environmental Bureau, 'EU plans multi-billion euro ‘green recovery’ but falls short in crucial areas' (27 May 2020) Friends of the Earth Europe, 'EU Green Deal: fails to slam on the brakes' (11 December 2019)
  14. ^ S Evans, 'Analysis: Coronavirus set to cause largest ever annual fall in CO2 emissions' (9 April 2020) Carbon Brief. F Harvey, 'Steep fall in emissions during coronavirus is no cause for celebration' (19 May 2020) Guardian
  15. ^ Intergovernmental Panel on Climate Change (2014). Climate Change 2014 Mitigation of Climate Change. Cambridge: Cambridge University Press. doi:10.1017/cbo9781107415416. ISBN 978-1-107-41541-6.
  16. ^ IASS/Green ID (2019). "Future skills and job creation through renewable energy in Vietnam. Assessing the co-benefits of decarbonising the power sector" (PDF).
  17. ^ IASS/TERI (2019). "Secure and reliable electricity access with renewable energy mini-grids in rural India. Assessing the co-benefits of decarbonising the power sector" (PDF).
  18. ^ IASS/CSIR (2019). "Improving health and reducing costs through renewable energy in South Africa. Assessing the co-benefits of decarbonising the power sector" (PDF).
  19. ^ F Harvey, 'Treasury's 'green recovery' not enough, say campaigners' (7 July 2020)Guardian
  20. ^ E McGaughey, M Lawrence and Common Wealth, 'The Green Recovery Act 2020', proposed UK law on website, and pdf. See 'The Guardian view on a post-Covid-19 recovery: not much building back greener' (7 July 2020) Guardian, "Mr Johnson has talked of a “new deal” and he could take up the suggestion by the Common Wealth thinktank to legislate for a green recovery act to drive an economic revival with renewable energy at its core."
  21. ^ JS Murray, 'Green Recovery: Germany unveils plans for €40bn climate spending surge' (4 June 2020) Business Green
  22. ^ Special meeting of the European Council, 17-21 July 2020, paragraphs A21, 18 Retrieved 15 November 2020.
  23. ^ Ryan Cooper (February 12, 2021). "Biden warms up to the Green New Deal". The Week. Retrieved 9 October 2021.
  24. ^ a b Mike Krancer (February 1, 2021). "Biden's version of Green New Deal moves forward, but executive action has its limits". The Hill. Retrieved 9 October 2021. Comparing the Green New Deal to the Biden Plan For A Clean Energy Revolution And Environmental Justice, one might think they were written by the same person
  25. ^ Andrew Chatzky and Anshu Siripurapu (February 1, 2021). "Envisioning a Green New Deal: A Global Comparison". Council on Foreign Relations. Retrieved February 18, 2021. major world economies, including China, India, and the European Union, have begun implementing some of the policies envisioned by the Green New Deal,
  26. ^ Aris Roussinos (February 17, 2021). "The age of empire is back". unHerd. Retrieved February 18, 2021.
  27. ^ Frazin, Rachel (April 20, 2021). "Overnight Energy: Biden reportedly will pledge to halve US emissions by 2030 | Ocasio-Cortez, Markey reintroduce Green New Deal resolution". TheHill. Retrieved 9 October 2021.
  28. ^ Kurtzleben, Danielle (2 April 2021). "Ocasio-Cortez Sees Green New Deal Progress In Biden Plan, But 'It's Not Enough'". NPR. Retrieved 9 October 2021.
  29. ^ Segers, Grace (13 May 2021). "Green New Deal advocates see imprint on Biden's climate agenda". cbsnews. Retrieved 9 October 2021.
  30. ^ "Critical measures of global heating reaching tipping point, study finds". The Guardian. 28 July 2021. Retrieved 13 August 2021.
  31. ^ Sathaye, J.; et al. (2007). "Sustainable Development and Mitigation". In B. Metz; et al. (eds.). Climate Change 2007: Mitigation. Contribution of Working Group III to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press, Cambridge, UK, and New York, N.Y., U.S.A. Archived from the original on 2 November 2018. Retrieved 2009-05-20.
  32. ^ a b "Which is better: carbon tax or cap-and-trade?". Grantham Research Institute on climate change and the environment. Retrieved 2020-03-12.
  33. ^ Implementing a US carbon tax : challenges and debates. Parry, Ian W. H. (Ian William Holmes), 1965-, Morris, Adele Cecile, 1963-, Williams, Roberton C., 1972-. New York. 2015. ISBN 978-1-138-81415-8. OCLC 891001377.CS1 maint: others (link)
  34. ^ "Pros and cons of a carbon tax » Yale Climate Connections". Yale Climate Connections. 2016-07-20. Retrieved 2020-03-12.
  35. ^ Chen, Zi-yue; Nie, Pu-yan (2016-12-01). "Effects of carbon tax on social welfare: A case study of China". Applied Energy. 183: 1607–1615. doi:10.1016/j.apenergy.2016.09.111. ISSN 0306-2619.
  36. ^ "How To Retire Early". Rocky Mountain Institute. Retrieved 2020-07-01.