Economic analysis of selected climate impacts. JRC PESETA IV project âTask 14

Climate change damages the capital stock, affects economic production and the welfare of households in regions suffering the impact or that are economically linked with them. These economic effects have been quantified for seven climate impact categories: river floods, coastal floods, agriculture, energy supply, droughts, windstorms and human mortality. Due to the limited coverage of climate impacts, the assessment does not evaluate the full economic impacts of climate change in Europe. Human mortality from extreme heat dominates the economic climate impacts, yet its contribution is strongly dependent on the monetary valuation of human lives. The magnitude of welfare losses in the Southern regions (Central Europe South and Southern Europe) is estimated to be several times larger compared to that in the North of Europe. Limiting warming to 2oC would halve economic impacts compared to a 3oC scenario, while achieving the stringent Paris target of 1.5oC would lower welfare loss by 75%.