Environmental Policy and Planning Group

The UHERO Environmental & Policy Planning Group partners with government, non-profit, business, and community groups to address Hawaiʻi’s key environmental policy challenges. To do so we employ a diverse set of interdisciplinary methods and tools to study the interconnection between human and natural systems with the purpose of contributing to more effective decision making. We specifically work in the linked areas of water, energy, food systems, watersheds, and coastlines, where an overarching theme is how to mitigate and adapt to land use and climate change and their effects on these systems.

Assessing the impact of COVID-19 on global fossil fuel consumption and CO2 emissions

Nori Tarui


We assess the effect of the COVID-19 pandemic on global fossil fuel consumption and CO2 emissions over the two-year horizon 2020Q1-2021Q4. We apply a global vector autoregressive (GVAR) model, which captures complex spatial-temporal interdependencies across countries associated with the international propagation of economic impact due to the virus spread. The model makes use of a unique quarterly data set of coal, natural gas, and oil consumption, output, exchange rates and equity prices, including global fossil fuel prices for 32 major CO2 emitting countries in 1984-2019. We produce forecasts of coal, natural gas and oil consumption, conditional on GDP growth scenarios based on alternative IMF World Economic Outlook forecasts that were made before and after the outbreak. We also simulate the effect of a relative price change in fossil fuels, due to global scale carbon pricing, on consumption and output. Our results predict fossil fuel consumption and CO2 emissions to return to their pre-crisis levels, and even exceed them, within the two-year horizon despite the large reductions in the first quarter following the outbreak. Our forecasts anticipate more robust growth for emerging than for advanced economies. The model predicts recovery to the pre-crisis levels even if another wave of pandemic occurs within a year. Our counterfactual carbon pricing scenario indicates that an increase in coal prices is expected to have a smaller impact on GDP than on fossil fuel consumption. Thus, the COVID-19 pandemic would not provide countries with a strong reason to delay climate change mitigation efforts.