Green spending in the economic downturn

Firstly, a big thanks to those of you who responded to last call for discussion on low carbon heat and my house. Thanks to NERN members I've learned the importance of sealing skirting boards and also have a bundle of literature comparing low carbon heat technologies.

Perhaps it's a sign of the economy woes, but I'm struggling to spot any job and funding opportunities at the moment - if you have heard of anything please do let me know.

This week I've been inspired by a piece in the Guardian – "Great clean up – can economic rescue plan also save the planet " – in which the green claims of the global economy recovery plans are scrutinised. Thanks to whoever pinned that up on our notice board!

So how much do experts think we should be spending on green measures? Sir Nick Stern thinks that green measures should comprise 20% of these plans. The UN has suggests an annual target of 1% GDP.

How do the various economic recovery plans match these ambitions? I should place an important caveat here that I'm going from a HSBC table in the Guardian – I just thought I'd make it clear that these figures might not stand up to scrutiny (particularly since the article itself seems to contradict them).

Unsurprisingly, it is a rather mixed picture. South Korea is leading the way, devoting nearly 70% (3% of its GDP) to green measures in their $36bn package. China is next, pledging one third of their mighty $581bn package (I estimate 4.6% GDP) to green measures, with a focus on energy efficient (which as we see is a good thing). You'll note I haven't mentioned the UK yet – I'm getting there. What about the USA? Well, of the whopping $825bn recovery package, around 16% is pledged to green measures (which by my rough calculations is around 0.9% US GDP) – so quite reasonable. In Europe, out of an overall recovery package (announced so far) of $253bn, 14% appears to be attributed to green plans. Germany is the leading light here, pledging 19% of their package to green investments (although representing just 0.3% of their GDP). In Europe both Spain (10%) and France (8%) have pledged a greater proportion of their recovery packages to green measures compared to the UK (7%). Of the total UK recovery package, at $29.9bn (about the same in euro and dollars at current exchange rate – only joking), representing about 1% of UK GDP, only $2.1bn appears to be earmarked for green things (0.07% GDP). Bottom of the pile are Japan (2%), Italy (1%) and India (0%).

So overall the packages represent a 13% spend on green measures. Although this is lower than Sir Nick Stern's proposal for 20%, it strikes me as better result than it could have been had everyone retreated into an "economy first, green second" shell. Assuming of course I'm no being greenwashed.

For those who are interested, the Grantham Research Institute on Climate Change at LSE have released a policy briefing "An outline of the case for a 'green' stimulus ", which ranks green measures on economic factors and climate change impact. The central argument is that a 'green' fiscal stimulus "can provide an effective boost to the economy, increasing labour demand in a timely fashion, while at the same time building the foundations for sound, sustainable and strong growth in the future". The paper then goes on to score various measures against both economic and climate change criteria and produces a league table of measures. Perhaps unsurprisingly, those that score most highly are all related to energy efficiency. Some may raise an eyebrow at the fact that carbon capture and storage and advanced battery development prop up the bottom of the table. The reason is that neither offers an immediate shot in the arm for the economy; however, both are important medium- and long-term priorities so should be supported by appropriate measures.