In the current health crisis we are experiencing, the environmental issue has become important and deserves to be placed at the center of the public health discussion. In fact, various Natural Science research institutes have pointed out that this crisis had its origin in the interruption of the delicate environmental balance. Factors such as habitat destruction, capture, trafficking and consumption of wildlife have represented favorable conditions for the SAR-CoV-2 virus to become contagious to humans. This is why today, more than ever, the protection of natural resources and the environment is crucial.
For this reason, it is important to ask ourselves: What will happen after the pandemic? What will be our role in this return to a “new normal”? What are our alternatives? How can we identify these measures or solutions? Which actors should be added? Which communication strategies should be promoted at a territorial level?
We must acknowledge that the main cause of the spread of this disease is the poor relationship that humans have established with the environment. Therefore, we have to generate a new, more harmonious relationship between society and nature. This is the only way to avoid similar situations: not only those associated with health problems, such as the emergence of new epidemics and their escalation towards pandemics, but other phenomena that have been documented with scientific evidence, such as the loss of biodiversity, climate change, water loss, and the reduction of plant cover and soil erosion, could lead us to critical situations for humanity.
Credits: Shutterstock. The increase in domesticated animals for human consumption has a large impact on ecosystems.
One of the most relevant causes is the change in land use, explained by the increase in extractive and productive activities, deforestation, and the expansion of urban areas. Another relevant factor is the increase in the proportion of domesticated fauna (for example, cattle, pigs, and poultry) in recent centuries as food for human consumption, alongside a detriment in the proportion of wild fauna. Consequently, this combination of elements has expanded the universe of pathogens associated with domesticated fauna, specifically viruses, bacteria, fungi, parasites, prions or misfolded proteins. These pathogens play a role, and ecosystems, both terrestrial and marine, depend on their activity. For example, plants and animals release residues into the soil (carbon, nitrogen and sulfate, among others) that, when degraded, are used by bacteria as food. Thus, it is important that anthropogenic activities – and the different sectors involved in the environment – become aware of this and act responsibly, maintaining the natural balance.
For these reasons, the Nationally Determined Contributions (NDC) presented in 2015 by the Government of Mexico, and now in 2020, subjected to a review and update process, should identify concrete actions, opportunities, and needs, taking into account the value of natural resources, ecosystems, and their services to human and planetary health that provide the means for their implementation at different scales in the country.
On May 14, the first webinar on climate change was held in Chiapas: “Economic Effects Resulting From the COVID-19 Contingency in Chiapas“. This meeting was organized by the State Advisory Council on Climate Change, as part of the efforts to reflect on the economic impacts that we are facing as a society in the face of the current health emergency.
The webinar involved four speakers from different sectors, who focused their presentations on two relevant aspects. On the one hand, they shared the geographical context and the unequal ways in which the local Chiapas communities are facing the contingency. On the other, they highlighted the importance of not seeing economic problems according to sector, but rather with a bigger vision that links to the national perspective, to enable dialogue and find new ways of working in the post-pandemic stage.
Credits: Pronatura Sur. Webinar
The productive sector also participated through the Ministry of the Board of Directors of the Mexican Milk Federation, who stated: “We need, more than ever, to turn sustainable livestock farming into a public policy that guarantees the participation of producers, technical agents, and NGOs in tune with our governments, in order to face the vulnerability in which the productive sector finds itself. ”
The government sector was represented by the Ministry of Environment, Energy and Sustainable Development of Oaxaca, which, from its experience as a member of the GCF Task Force (GCF TF), stated that there are great challenges facing indigenous peoples of Latin America in the face of this sanitary and climatic emergency; thus, the GCF TF is proposing a work route from the instances at the international level to face uncertainties regarding the increase in forest destruction.
The aim of the GCF TF is to guarantee the permanence of forests and the livelihoods of their inhabitants, so efforts will focus on reducing environmental and social risks during the post-COVID-19 economic reactivation. The pressure on land and the risks of deforestation will increase exponentially if there are no economic alternatives for the most vulnerable groups, such as indigenous and rural communities, and the floating population, which has experienced unemployment during the pandemic. Thus, this initiative will be focusing its efforts on modifying existing strategies and developing new ones that allow it to support its member states – such as the state of Chiapas – during economic recovery, mainly in the forestry sector.
People’s wellbeing depends, among other things, on environmental conditions. Poor air quality can increase the risk of respiratory complications during diseases such as COVID-19. Air quality monitoring facilitates risk assessment and public policy decision-making.
The forest fires and agricultural burning that take place in many regions – including the Mayan Forest – generate harmful particles, visible as black smoke, which affect human health. The respiratory problems caused by these particles are an aggravating factor for people who are fighting against the disease caused by the novel coronavirus type 2, better known as COVID-19, which is ending the lives of many people.
Credits: César Paz – WCS Guatemala. Fire in the Mayan Forest
To assess the risk level that air pollution means for human health, it is important to have access to reliable data. For this reason, the project Development of a Regional System to monitor biodiversity and climate change – Selva Maya, financed by the Germany’s Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) within the framework of its International Climate Initiative (IKI), supports various actors in the Mayan Forest region in monitoring air quality.
For this, the project supported the acquisition of PurpleAir sensors that were installed in different regions of the Mayan Forest, covering areas in Guatemala, Belize and Mexico. These sensors detect air particles, and the levels are available publicly and in real time on the Internet.
Credits: GIZ / Ameyalli Nares. An Aire PurpleAir Quality Sensor
This data has already been used to improve the living conditions of many people. After confirming a dangerous air quality level during a fire at the San Benito landfill, Guatemala, the municipality began the process for better solid waste management. In Belize, data concerning agricultural burning inspired a social media campaign. Consequently, the Belize government passed a law that prohibited burning during the COVID-19 contingency.
Due to these successful experiences, actors in Guatemala, Belize and also Mexico want to expand the network of air quality sensors. This will allow faster detection and reaction to threats to human respiratory health. Together with other measures, this approach will help the population and decision-makers of the three countries to cope with the COVID-19 pandemic and possible similar epidemics in the future.
Due to the COVID-19 outbreak, the priorities for attention to the health emergency have been markedly reduced. Government efforts have also been redirected to protecting citizens and fighting against the health epidemic.
In an adjustment process, the municipalities’ focal points, national development banks, and federal ministries (Ministry of Agricultural, Territorial and Urban Development – SEDATU, Ministry of Environment and Natural Resources – SEMARNAT, Secretary of Treasury and Public Credit – SHCP) have continued preparing their projects.
With the support of FELICITY and key actors, the migration of face-to-face project preparation courses to digital workshops has been encouraged, so that sub-national public officials can continue their great efforts in the development of technical, financial, environmental, technological and social capacities.
Project promoters have also collaborated through platforms that facilitate training and remote communication for project preparation. Progress is being made in technical assistance from the cabinet, to prepare the procurement process and have the documentation required for the continuation of the project cycle.
A healthy collaboration between the parties involved has allowed the adjustment towards the implementation of the projects; however, the main challenges in the current context of COVID-19 increase the pressure on urban budgets.
Green recovery represents a potential opportunity to reduce budget spending by saving energy costs, but also to generate more quality jobs and mitigate greenhouse gas emissions. The continuity of these projects is particularly important in the current context of a health crisis that seeks economic recovery in the short term and green recovery in the medium term.
Distributed Generation is an adequate mechanism to impulse cost reduction in companies and organizations while avoiding emitting greenhouse gases into the environment. It is an important strategy to mitigate the economic impacts of COVID-19, and one of the main challenges is to find financing mechanisms that can accelerate the execution of these projects in the country. For this reason, LAB Mexico promoted the development of a workshop for the financing of Distributed Generation (DG) on November 13, 2019.
Currently, the photovoltaic DG has an installed capacity in Mexico of almost 1,000MWp, representing 1% of the capacity of the national electricity system, while the available capacity of the General Distribution Network is 27,000MWp. The DG will play a fundamental role in fulfilling energy transition goals by 2035.
There is a great opportunity to support companies – especially small and medium-sized enterprises – with renewable energy strategies that reduce their energy costs, permitting the recovery of their post-COVID-19 economies.
The conclusions, based on the analysis of the discussions carried out among participants during the workshop, will serve as a guide for establishing the monitoring and intervention plan (roadmap) with key stakeholders in the industry.
Credits: LAB México
The DG sector is not robust enough to finance this transformation alone. Commercial banking in Mexico is a solid sector with reserves, capacities and scope that can facilitate this transition.
However, both industries are required to work together on the following aspects:
The promotion of the benefits of photovoltaic DG must be strengthened in the SME sector to increase financing demands for this type of project. This promotion should be a joint effort between relevant business associations, development finance institutions, and local and federal governments.
Revolving credit lines must be implemented for companies integrating DG in order to facilitate DG growth and consolidation.
Other financing instruments, such as leasing and energy purchase contracts, must be promoted as alternatives to conventional credit, both in supply and demand.
A certain and stable regulatory environment must be promoted to facilitate the investment of risk capital with different business models and financing, and with the capacity to replicate and scale. This is the work of the photovoltaic industry, alongside development and commercial financial institutions, as well as local governments.
Information that allows financial institutions to better assess risks and generate products according to the risk profile of the projects must be generated on the market and performance of DG projects.
Financial institutions require a greater technical understanding of the value propositions of PV systems, their operational risks and shelf life.
Various financial intermediation schemes should be explored with the support of “asset managers” that facilitate project evaluation, risk determination, dispersion of financing and collection responsibility.
As a product of this IDB workshop, ABM and GIZ, together with NAFIN, encouraged the hiring of a consultant to provide material for this roadmap, which will be delivered at the end of June and will be disseminated through the IDB, ABM, GIZ and IKI.
Communities that conserve, restore and sustainably exploit mangroves depend on the fair marketing of their products. Mundo Manglar is a strategy that seeks to connect local products with responsible consumer markets – a particularly relevant proposal in the face of the COVID-19 pandemic and its impacts on the local economy.
In the context of the COVID-19 health contingency, the need to promote consumption in fairer markets, favoring local economies and projects based on the sustainable use of our ecosystems, has been highlighted. Mundo Manglar is a promotional initiative led by Pronatura Veracruz A.C. to sensitize the market to the importance of mangroves and the environmental services they provide. The responsible consumption of products such as wood, charcoal, and honey contributes to the conservation of biodiversity and boosts local economies, especially in the face of the global health contingency.
Local livelihoods that depend directly on mangroves have been heavily impacted by the health contingency. Activities such as fishing or the production of charcoal, wood, and mangrove honey are linked with other economic sectors that are currently detained or restricted – such as tourism and local food consumption.
The health emergency requires a response that can mitigate direct impacts and, in turn, create opportunities to strengthen projects in the face of the medium-term repercussions. Analyzing the value chains in the face of the pandemic allows us to identify implications and specific actions to move forwards with the commercialization of mangrove products.
In this context, the Mundo Manglar website and campaign takes on more relevance and also faces important challenges. It must enable effective digital sales and delivery systems, considering the communities’ limited access to digital media. On the other hand, we must sensitize the market to maintain and increase the consumption of products with fair prices, both during the contingency and the medium-term repercussions of COVID-19.
The Water and Sanitation Companies program for Water and Wastewater Companies for Climate Mitigation (WaCCliM) is implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH in Mexico, in direct coordination with the National Water Commission (CONAGUA). The program’s main aim is to support water and sanitation operating agencies (OOs) in reducing their carbon footprint and increasing their climate resilience.
Increasing the frequency of handwashing is one of the main activities promoted by the Mexican Government to reduce the spreading of the COVID-19 virus. This daily activity leads us to pay much more attention to the “behind the scenes” of the water and sanitation sector, as well as the importance that it function, so that people in any part of the country can have access to enough water – in quality and quantity – to carry out this preventive measure.
The activities of the WaCCliM program have a direct and organic relationship with the sustainable recovery (green recovery) that is expected during the following months or years. They include: strengthening the capacities of the operational personnel currently working in OOs; improving public health services by promoting access to drinking water and sanitation services throughout the country; promoting and replicating the use of technologies that minimize the carbon footprint of OOs and which, in turn, require the professionalization of the sector, in order to provide technical consulting services and the implementation of environmentally friendly technologies.
The Emissions Trading System (ETS) is one of the carbon price mechanisms that has accelerated the mitigation of greenhouse gas (GHG) emissions over the past decade. It works using the “cap and trade” principle. A limit is imposed on emissions from one or more economic sectors, and regulated facilities are granted a limited number of emission rights that they can trade among themselves, to carry out their compliance obligations in a cost-effective manner.
There are factors that ensure the proper functioning of an ETS; among them, stability in carbon prices and a supply of emission rights that is consistent with market demand. The current economic recession caused by COVID-19 has altered these two variables and has presented significant challenges for the more than 20 ETS operating around the world. It is important to be aware of the global strategies to overcome these challenges and identify lessons learned that could strengthen the ETS Test Program in Mexico, in force since January 2020.
According to ICAP data, there was a significant drop in carbon prices in California and Quebec in March, as well as in the European Union (EU), where it fell from an average of 25 EUR to 15 EUR. In Switzerland, the auction of emission rights was even rescheduled due to the price drop. Commercialization of emission rights in the ETS of the EU is affected by oversupply, which can lead to a reduction in public revenue from auctions, and discourage investments in mitigation technologies.
Countries such as Canada, China, Korea, and Switzerland have responded to these impacts by postponing compliance and reporting dates, while the European Commission anticipates a reduction in the number of emission rights available within the Market Stability Reserve. On the other hand, Poland and the Czech Republic have suggested a review of the EU’s ETS conditions.
Strategies implemented by other countries help inform Mexico of the risks faced by ETS and their possible solutions. The project “Preparation of an Emissions Trading System in Mexico” (SiCEM), implemented by the Deutsche Gesell¬schaft für Internationale Zusammenarbeit (GIZ) GmbH will follow the evolution of the system’s global situation closely.
States and regions play a critical role in achieving green recovery from the COVID-19 pandemic. These jurisdictions are closest to the communities and have a great opportunity to link economic recovery measures with environmental considerations.
The Climate Footprint Project, which supports the governments of Baja California, Jalisco and Yucatan to improve their greenhouse gas (GHG) reduction and monitoring efforts, has recognized the importance of adapting to the current crisis. It seeks to demonstrate the importance of Measurement, Reporting and Verification (MRV) systems in providing the data that will allow state governments to assess the socioeconomic and environmental impacts of climate actions. Furthermore, this will help to highlight one of the most important results we have been able to see so far: the mainstreaming of climate change.
In the face of travel restrictions and large group meetings, the project has reinvented itself to achieve its goals. A concrete example is the Jalisco experience, where a series of technical webinars have been developed with the different Ministries that form part of the mitigation group at the state’s Inter-Institutional Action Commission on Climate Change, as part of the capacity-building offered by the project. For one month – online – representatives from each Ministry have joined working groups to continue mainstreaming climate change in their entities.
Credits: The Climate Group. Webinar-Presentation System for monitoring climate actions at the sub-national level with GIZ (May 19).
Through interactive tools, the team facilitated work sessions to develop and identify mitigation actions and indicators that lead towards monitoring a future green recovery. Similar work will be done in the states of Yucatan and Baja California. In parallel, the “From Follow-up to Action” series of peer-to-peer forums will begin shortly, providing another opportunity for state governments to learn virtually.
Credits: The Climate Group. Virtual working group – Jalisco transport sector.
To provide a customized package of technical assistance and training for states to improve their capabilities and knowledge on Measurement, Reporting and Verification (MRV) systems;
To align regional MRV systems with national and local efforts in order to promote integrated climate action through dialogs between national, state, regional and local governments, and align climate actions at all levels of government;
To promote knowledge exchange and the reproduction of good practices at an international level through case studies and peer forums, among others.
COVID-19 has affected Mexico since February 27 of this year and with it, the people’s mobility and interaction has been restricted. One of the most vulnerable sectors to these measures is the Tourism sector.
According to preliminary figures from the World Tourism Organization, a loss of approximately 45 billion dollars is estimated, and a decrease between 60 and 80% in the arrival of international tourists in 2020. To equate these figures, that means losing almost twice the amount of foreign exchange registered in 2019.
The situation is complex and challenging for everyone, especially for small and medium-sized enterprises and the population that depends on them. José Benigno Torres, President of the San Miguel de Allende Business Coordinating Council, stated that, at least in this tourist destination:
“There is a risk of 60% of hotels closing permanently, and around 40% of restaurants… And those of us who are going to transcend this epidemic face particularly important challenges: we must reinvent the way in which we provide our services and learn from this huge health crisis.”
As a consequence, business dialogues have been taking place in several parts of the country, reflecting upon the way tourism developed before the crisis and if it is adequate for this new reality. Likewise, some reflections are being shared regarding the lessons that should permeate in future sector decisions. The Bahía de Banderas and Puerto Vallarta Business Association (AEBBA), through its president, Jorge Villanueva, stated:
“The great lesson that COVID leaves us is the folly of humanity by not protecting nature, in many areas. We cannot go back to doing things the same way. We have to be more socially and environmentally responsible.”
Without a doubt, the total impacts on tourism will be documented with more certainty in the months following the end of the pandemic and in accordance with the mobility regulations that each country establishes. Therefore, this moment is an opportunity to create creative strategies that permit the economic, social, and environmental recovery of the country.
The construction sector is essential for an economic recovery after the COVID-19 crisis. It can rapidly create large amounts of jobs and involves far-reaching value chains of small and large businesses. In 2015, the sector accounted for 11-13% of global GDP. It is indeed a major employer: 7% of total global employment or 220 million jobs depend on it. Globally, USD 4.5 trillion were spent on construction and renovation of buildings in 2018.
The building sector holds the potential for a double win: providing a powerful tool to stimulate the economy, while moving the whole sector to a new and greener state. For small extra investments, green buildings can achieve massive long-term savings of cost and greenhouse gas (GHG) emissions. The International Energy Agency (IEA) estimates that realizing the potential of sustainable buildings will save USD 1.1 trillion by 2050. Nevertheless, the real estate business is slow to change its way of doing things and mobilize these small extra investments without external nudges in the form of legal obligations or incentives.
Crisis Response as Investment in the Future: Examples from Republic of Korea, Germany and US
Therefore, we have at this moment of global crisis a unique opportunity to shift the course of the building sector and earmark investments for green construction. Governments all over the globe are devising the best strategies to deal with the crisis, under enormous time pressure. If we aim for “business-as-usual,” we will repeat or even aggravate the mistakes of the past. Instead, we need to urgently change the path of the building sector to move towards green buildings, or even zero-carbon buildings.
The response to the crisis should be an investment in the future. Governments already successfully used green building programmes to help recover from the financial crisis in 2008. For example, the Republic of Korea used stimulus measures for green buildings that combined stricter policies with financial support. A green building code for large residential buildings required a 20% energy efficiency improvement. In parallel, the government provided a financial incentive programme for the retrofitting of homes. A ‘Building Energy Certification Programme’ was gradually extended to all building types.
Germany used programmes for energy-efficient construction and refurbishment. Preferential loans for new residential constructions and refurbishments of residential, municipal, and social buildings set increasingly higher standards for energy efficiency. With government funding of EUR 2 billion in 2016, the programmes leveraged investments of EUR 45 billion, roughly half of which was directly spent on energy efficiency measures. In 2016, more than 400,000 private residential units were financed and 286,000 jobs induced. The subsidised buildings saved 1,730 GWh of final energy and 619,000 tonnes of GHG emissions in 2017.
The US provided more than USD 11 billion in stimulus funding for building upgrade programmes in sectors such as homes, businesses, government buildings, and public facilities such as schools and hospitals after the financial crisis. These programmes delivered about USD 2 in energy cost savings for every USD 1 invested. More than 200,000 jobs were created.
Credits: PEEB
Successful Blueprints for Green Building Programmes Exist
Green building programmes can stimulate economic activity and create jobs, while simultaneously achieving environmental and social goals. The French-German PEEB programme is currently working with its partner countries in Morocco and Vietnam on such stimulus programmes for energy-efficient buildings.
A combination of several instruments such as financial incentives or public procurement can be employed, targeting either investors or private households. This can be done through:
Residential or commercial energy efficiency programmes for new buildings or refurbishments that use public funds to leverage private investments, through instruments such as subsidies, grants, or concessional loans.
Public procurement programmes for energy efficiency in public buildings through retrofits or new construction, for example in schools, hospitals or administrative buildings, can improve hygienic standards at the same time.
Replacement programmes for equipment and appliances, such as boilers, energy-efficient lighting or household appliances through bulk purchasing or installation programmes, which provide financial incentives, like subsidies or tax exemptions, to suppliers (supply-side) or households (demand side).
Green energy generation in buildings, providing incentives to households or private investors.
Ambitious policies and standards for green buildings should be developed in parallel, to ensure a lasting transformation of the building sector. This should be accompanied by knowledge transfer and the development of local green building and construction skills.
“Strings Attached” – Green Conditionality for Stimulus Packages for Building Sector
Green stimulus packages for the construction industry need to have “strings attached”: a “green conditionality” is needed to set the bar higher for buildings that receive support.
Some basic criteria can be applied, based on the national context, to favor a sustainable development of the construction sector in the long term:
Rewarding performance: higher energy or low-carbon performance goals should be rewarded with higher financial incentives.
Incentives for project certification and labeling through a systematic inclusion of energy efficiency and environmental criteria in public and private procurement documentation and lending.
Preferential treatment for green buildings: Priority should be given to green construction projects, for example through including green criteria for public procurement or “fast track” processing of building permits.
Accelerate national climate policies: short-term economic stimulus programmes should be geared towards a country’s climate and sustainable development
By setting smart and effective criteria for green buildings, short-term stimulus packages can become a double tool for economic recovery and environmental sustainability. If we work towards the goals of the Global Alliance for Buildings and Construction (GlobalABC) of a zero-emission, efficient, and resilient building and construction sector, the response to the crisis becomes an investment into the future.
