Jul 6, 2020 - Energy & Environment
Column / Harder Line

Coronavirus topples 2020 energy and climate predictions

Illustration of an earth as a Magic 8 ball with the triangle in the center reading "Covid-19"

Illustration: Annelise Capossela/Axios

In early January, I laid out 10 energy and climate change issues to watch this year. Spoiler alert: A pandemic was not on that list.

The big picture: The coronavirus has left no part of our world untouched, energy and climate change included. Let’s check in on my 2020 predictions at the halfway mark of this tumultuous year.

1. Politicking

Climate change was reaching a new high-water mark for its role in the presidential contest among Democratic candidates. That focus has lessened significantly, along with an overall lack of attention to the election itself.

What I’m watching: Expect climate change to play a supporting role in the debate about other topics — the pandemic and racism — grabbing society’s attention.

2. Bottom of the barrel for oil and gas

I predicted global oil prices would remain low throughout this year, but boy I didn’t think they would go so low they would (briefly) go negative.

What I’m watching: Whether 2019 turns out to be the peak in the world’s oil demand, thanks largely to the coronavirus, or whether we’ll see an even stronger rebound in the coming years if the world doubles down on its pre-pandemic travel habits.

3. Big oil’s greenish shifts

Some big European oil companies, led by BP and Royal Dutch Shell, have maintained at least a rhetorical commitment to keep transforming into cleaner businesses. But independent experts say the pandemic has put all companies in a tough financial position, and that could jeopardize their willingness to follow through.

What I’m watching: To what degree more companies write down assets (BP, in June, was the latest one to do so). Analysts say these decisions are at least partly an acknowledgment that oil and gas reserves will be less valuable in a future with fewer emissions.

4. Carbon taxes

The persistently long-shot campaign of a carbon tax on Capitol Hill has gone awfully quiet in the last few months as the pandemic grips the world.

What I’m watching: A climate proposal House Democrats released last week includes a price on carbon, with an emphasis on ensuring protection for poorer Americans. I’ll be watching to see to what degree Biden embraces that — or whether he waits to see if he wins in November.

5. Paris Climate Agreement

The United Nations is delaying by a full year its high-profile conference where nations were supposed to announce increased ambitions, the first time since the Paris Climate Agreement was inked five years ago.

What I’m watching: The election will have a huge impact on the fate of this deal, but I’m also watching to what degree the delay gives countries more time to actually put forth more ambitious plans — or whether the delay will only cement lackluster progress.

6. China rising

The pandemic has likely delayed China’s intentions of launching a national system of trading carbon dioxide credits this year, experts tracking the news tell Axios. Instead, the country is building more coal plants.

What I’m watching: The Environmental Defense Fund says China still hopes to launch its system before the end of the year and that so far it's sticking to a target of having eight sectors of its economy covered by 2025.

7. Trade wars

The coronavirus has zapped the natural-gas export boom, which had already been facing immense challenges brought on by Trump’s trade war with China.

In response to the pandemic’s economic toll, Europe is integrating clean-energy policies into its recovery plan. To the extent America does not (the path we’re on now), Europe may be even more inclined than ever to place carbon tariffs on U.S. products, a component of its Green Deal it unveiled late last year.

8. Renewable challenges

I had written that I would be looking out for the challenges facing wind and solar as their share of the electricity pie increases. While I still am, the pandemic showcased two unique attributes to these renewable sources:

  1. They’re not part of a volatile global market like oil and natural gas.
  2. Because of low operating costs, wind and solar often keep running over other energy sources like coal and nuclear.
9. Senior reactors

Less action is happening on this front than I anticipated — certainly compared to the tumultuous state of the world.

10. Climate change, in real time

The Australian bushfires — yes, they were this year! — are a prime example of more extreme weather occurring and scientists documenting it.

What I’m watching: To what degree extreme weather worsens this summer — especially wildfires — and to what degree it exacerbates the pandemic crisis and racial inequality.

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