Whether the global credit crunch will actually help or hurt the search for solutions to climate change is becoming a debatable issue.
Currently, the issue of climate change appears to be on the back burner as governments are focused on the financial problems that have shaken the global economy. It could be several months before politicians return to focusing their attention on long term problems like global warming.
Can Renewable Energy Companies Withstand A Slower Economy?
Here in America although the $700 billion bailout package has extended tax credits for renewable energy companies, the industry is largely driven by project finance. This means that in all likelihood the larger utilities that will stand their ground whereas many of the smaller wind and solar energy companies that depend upon funding could be negatively affected.
Slower Economic Growth Translates to Less Carbon Emissions
On the other end of the spectrum, slower economic growth could mean less fossil fuels being burned translating to a slower growth of carbon dioxide emission. Given that people need to focus on conserving energy, it might jump start the growth of a greener economy. The Intergovernmental Panel on Climate Change (IPCC)’s Rajendra Pachauri has predicted that the financial crunch would bring “soul searching about how society might act to reduce dependence on fossil fuels” and shift to renewable energies such as wind, solar or hydropower.
What is your opinion? Does the credit crunch help or hurt our focus on climate change and our shift to green economics?
Photo credit: www.siliconeer.com