Canadian governments have been, quite rightly, focused on delivering relief to those Canadians and businesses that are suffering from the economic impacts of COVID-19. But the conversation is beginning to extend to what comes next, once we bend the curve and can begin to get our economy up and running again.
It’s time for “plan-ahead-teams” to start “collecting forward-looking intelligence, developing scenarios, and identifying the options and actions needed to act tactically and strategically,” as McKinsey & Company put it.
And as Clean Energy Canada executive director Merran Smith and I wrote earlier this month, “While it may be tempting to try to rebuild the past, we must be realistic and build for the present and the future…Governments should aim stimulus at the economy they want: one with less pollution and more resilience.” We can choose to “build back better.”
That means governments need to deliver stimulus to activities that aren’t just “shovel ready,” but also “shovel worthy”—aligning it with other priorities and goals, including continued climate action.
When it comes to designing a plan for Canada’s economic recovery, those planning it need to start with a framework for a resilient recovery.
What should this framework look like? First off, it’s important to understand that there will be three stages to recovery.
Today, we are still in the relief stage, but we are all hoping that within a few months we’ll be able to transition, perhaps in a staged manner, into a stimulus stage. At this stage, the goal is to kickstart the economy, with government support for projects and initiatives that will deliver employment and economic activity quickly, within the span of a few months to a year.
Given the extent to which Canada’s economy has been harmed, stimulus alone is unlikely to get the economy humming. Achieving recovery—the third stage—will entail continued government efforts to rebuild the economy, building on and expanding stimulus efforts to ensure sustained and sustainable economic activity.
Three key principles should guide government efforts:
- Support must be sufficient in size. Success requires that the scale of stimulus and recovery support matches the scale of the challenge. Inadequate effort will compound our current challenges, making it even more difficult and pushing off a successful recovery.
- It must be sustained in duration. Recovery won’t happen overnight, especially in those sectors and regions hardest hit, so government support can’t disappear overnight. If no region or Canadian is to be left behind, this will be a multi-year endeavour.
- The recovery must be sustainable in nature. Our recovery will only be as resilient as it is sustainable. Both economically sustainable (which means diversifying our economy and growing our clean energy sector) and environmentally so (which means Canadians live in healthier communities with less air pollution and fewer climate catastrophes).
As the Smart Prosperity Institute’s Stewart Elgie has suggested, we need to act short-term but think long-term. This is a once-in-a-generation investment, so we must consider it through the eyes of our children.
What will build a better, more resilient Canada for them? What’s our vision for post-pandemic Canada?
Success would see Canada emerge from the pandemic more resilient than it was before. What does resilience mean? It means a more diversified and globally competitive economy. It means jobs that are secure for the long-term. It means a climate that is more stable and air that is more breathable.
Let’s unpack this vision. What are the goals we need to achieve to make it a reality?
- We need a competitive economy that is diversified, innovative, and clean, which means exporting low-carbon commodities, goods and services, and clean technologies to meet growing global demand.
- Canadians who have lost their jobs would find new, secure jobs, thanks to immediate support for workers across every province—particularly those whose jobs may not return—in the form of training and retraining, aligning skill sets with an evolving labour market.
- And while kickstarting the economy, we wouldn’t do so at the expense of a clean environment. We need to continue to protect our forests, parks, and oceans while reducing single-use plastics and other forms of waste.
- From the small town to the big city, all Canadian communities must be safe, healthy, connected, and prosperous. That means reliable internet access and transit options, efficient buildings in which to live and work, and shorter commutes with less air pollution.
- And lastly, Canada should build on the Pan-Canadian Framework on Clean Growth and Climate Change, helping us meet our 2050 net-zero climate commitments while creating jobs in the fast-growing clean energy sector.
Achieving these goals will require that governments deploy several strategies to train our workforce, re-tool industries to compete, build clean, and send clear policy signals.
As International Energy Agency executive director Fatih Birol recently put it, “rather than compounding the (coronavirus) tragedy by allowing it to hinder clean energy transitions, we need to seize the opportunity to help accelerate them.”
To that end, industry and non-profit leaders representing Canada’s clean energy sector—including renewable power, energy efficiency, cleantech, advanced biofuels and electric transportation—have submitted an open letter to Prime Minister Trudeau calling on the federal government to introduce clean-energy-focused stimulus in order to build a more resilient economy.
And Canada won’t be alone in putting a “climate lens” on its recovery efforts. From New Zealand to South Korea to the EU, a focus is being put on aligning economic recovery with the energy transition and climate action.
The COVID-19 pandemic, like climate change, isn’t a “black swan” event but a “gray rhino” (”highly obvious, highly probable, but still neglected dangers”). Risk expert Michele Wucker, who came up with the “gray rhino” metaphor, notes that “it matters immensely that decision-makers view risks as gray rhinos instead of obsess in vain about black swans, because we can see gray rhinos in front of us, but black swans by definition only appear in the rearview window. That means we have a chance to do something about gray rhinos. And, in fact, most so-called black swans happen because people ignored the gray rhinos.”
The gray rhino of climate change clearly stands before us. The world is wondering what would have happened if we took more proactive measures to stem the coronavirus. There’s a lesson here.
For our economy and the energy system that fuels it, planning for change, rather than reacting to it, will leave us all better off. Stay tuned for more ideas on how to put this framework into action.