We could not get through this pandemic – or run our national or global economies – without energy. Literally. Energy kept hospitals taking care of patients, kept essential services like grocery stores and pharmacies open, kept first responders equipped to respond and transport patients to medical care, and “providing reliable power and energy resources to communities,” as Lisa Jacobson, president of the Business Council for Sustainable Energy (BCSE) put it in her testimony before a recent hearing of the Senate Committee on Energy and Natural Resources, chaired by Senator Lisa Murkowski.
Yet, the energy sector is reeling under the weight of this pandemic. “Put simply, the Covid-19 pandemic has created the biggest shock to the global energy system since at least World War II, with the drop in energy demand this year set to dwarf that experienced after the 2008 financial crisis.” That’s how David Turk, the Acting Deputy Executive Director of the International Energy Agency (IEA) stated it in his opening remarks at that same hearing. The IEA estimates “that global energy demand will fall 6% in 2020 – the equivalent of losing the entire demand of India, the world’s third largest energy consumer,” he added.
Let that sink in a minute.
We know very few people are traveling to the point where the airline industry has requested a bailout. We are driving only a fraction of the amount we were before the pandemic-induced economic shutdown, and restaurants and office buildings that usually use enormous amounts of energy have been nearly empty and dormant. With schools closed, school buses have not been running either, and mass transit has been dramatically curtailed.
We love the cleaner air and being able to see vistas long clouded by smog as CO2 emissions drop as a result of our reduced travel and energy consumption.
So, how do we rebuild our economy and energy sector in a way that’s better and cleaner than it was before?
Of the 6.8 million energy sector jobs, about half of those, 3.4 million, are in clean energy, according to the March 2020 U.S. Energy and Employment Report, and it lost 1.3 million jobs – or 13% — in a few months.
Clean, renewable energy jobs suffered along with jobs in oil and gas, coal and utilities too, but Turk said it’s the only energy sector that will grow in 2020. It lost about 620,000 jobs, about 70% of which are in small businesses, because solar panel installations and other residential clean energy services, such as energy audits, have been curtailed during the pandemic, for example, Lisa Jacobson told me on my podcast recently. Even when the economy picks up, they will need time to restart because of safety strategies, rehiring and retraining workers, or hiring and training new ones she said.
Every crisis presents an opportunity, though, and this pandemic-economic shutdown is no different. It’s has triggered a multidimensional paradigm shift, as I wrote about in Forbes recently.
How do we maximize this crisis?
We rebuild the economy with a different set of principles, including considering elements from the American Energy Innovation Act (AEIA) proposed by Committee Chair Senator Lisa Murkowski (R-AK) and Ranking Member Senator Joe Manchin (D-WV), Jacobson urged, indicating that it has bipartisan support.
What Jacobson and the broad coalition of companies and trade associations in energy efficiency, natural gas and renewable that are BCSE’s members suggest, is an array of investments and financial incentives that address the following: investments in infrastructure; research and development (including ARPA-E, the energy innovation arm of the Department of Energy), especially in energy storage, a linchpin of a clean energy economy; as well as in all renewables, clean transportation modalities such as electric vehicles, energy efficiency technologies and systems, and grid modernization (aka a “smart grid”).
These clean energy initiatives need to be at the state and local level as well as the federal level, Jacobson stressed, and include support to increase energy system resilience, especially in the face of climate change (another part of the aforementioned paradigm shift). These are the folks rebuilding what Jacobson calls “mission critical buildings,” such as schools and hospitals . I would add local emergency response facilities like police and fire departments. There are financial mechanisms that Jacobson said can leverage private investment as well.
What can we do?
As we plan another great American comeback, Jacobson says we can rebuild it better, with clean energy that leverages our ingenuity and unique ability innovate and that creates new much-needed jobs that people with a wide range of skills and education levels across the country can do.
She also said we each have a responsibility to do our part as well, from voting in November (in local as well as national elections), to voicing your support for clean energy solutions with your elected officials, to using energy efficient light bulbs and clean energy or efficient transportation choices.
We can “be considerate and thoughtful in our choices,” she told me.