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Investing in the low-carbon transition after COVID-19
- October 1, 2020: Vol. 13, Number 9

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Investing in the low-carbon transition after COVID-19

by Blair Chalmers and Meghna Basu

The COVID-19 pandemic and its aftermath pose challenges as well as opportunities for the low-carbon transition agenda. Several governments have deprioritized climate commitments to boost their flagging economies, resulting in policy reversals and delays that threaten to slow the low-carbon transition. The United States saw the relaxation of several environmental regulations and fines during the height of the pandemic, as well as a shift in environmental review processes. In China, Beijing approved more coal-fired plants in the first three weeks of March 2020 than were approved in all of 2019.

At the same time, private firms advancing the green agenda have faced significant market shocks. The drop in demand for energy due to COVID-19-imposed economic lockdowns eroded already thin margins of renewable energy generators and additionally levied new pressures on liquidity-strapped renewables firms. Other market shocks, such as governments freezing budgets or delaying tenders, as w

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