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Globally, the opportunity to use COVID-19 fiscal rescue and recovery spending to accelerate the low-carbon transition has largely been missed so far: the share of low-carbon fiscal spending ranges between 0.5%–2.5% in studies considering both rescue and recovery spending and 18%–30% for studies considering recovery spending alone. This report analyses the potential impacts of the COVID-19 pandemic and associated rescue and recovery packages on greenhouse gas emissions to 2030, focusing on three main aspects: 1) What happened to activities and greenhouse gas emissions in 2020, and what are the preliminary estimates for 2021? 2) How did the 2020 and 2021 emissions changes affect pathways through to 2030? 3) What is the expected impact of fiscal recovery packages on emissions through to 2030?

This policy brief presents recommendations on how to align future COVID-19 fiscal response measures with the Paris Agreement’s long-term temperature goal globally, in the EU and, where data are available, also for selected Nordic countries. This brief is based on the findings of a research project supported by the Nordic Council of Ministers Working Group for Climate and Air (NKL), entitled: “The impact of COVID-19 and recovery packages on emission pathways to 2030”. This research project has been prepared as a specific contribution to the 2021 edition of the UNEP Emissions Gap Report.