New study shows urgent need for action on climate adaptation in Austria

Climate change is not only an ecological challenge, but also a massive economic one. In addition to measures to reduce emissions, adaptation to climate change is becoming increasingly important. The study conducted by EcoAustria on behalf of oecolution austria is the first to comprehensively examine the economic potential of climate change adaptation measures in Austria.

The central question is: How do investments in climate adaptation influence economic growth, employment and productivity in Austria?

I. Main results of the study
The study shows that targeted adaptation measures can bring considerable economic benefits:

- Reduction of economic damage caused by climate change impacts, in particular loss of productivity, destruction of infrastructure and crop failures
- Up to 26,000 additional jobs
- Increase in net hourly wages by 2.1
- Annual GDP increase of 13 billion euros
- Decrease in the unemployment rate by 0.3 percentage points (corresponds to 13,000 fewer unemployed)
- Improvement of the public primary balance by 3.5 billion euros

II. Why climate adaptation makes economic sense
- Without adaptation measures, annual climate damage of up to 10.8 billion euros by 2050 (assuming global warming of 2 °C) is imminent
- According to existing model-based analyses, measures in agriculture and forestry, flood protection, heat protection and early warning systems can compensate for up to 70% of the value creation losses caused by climate change
- In scenarios with greater warming, the economic effects are more significant, as the need for adaptation increases

III Need for action and recommendations
The results of the study underline the need to promote climate adaptation policies in a targeted manner. Five central measures are needed:
1. utilize synergies between climate protection and climate adaptation
a. Adaptation measures currently receive significantly less funding than climate protection measures
b. Funding programs should focus more on measures that simultaneously promote emissions reduction and adaptation, such as thermal building renovations, heat-resistant forests and renewable energies

2. strengthen climate risk insurance
a. Rising climate risks put insurers under pressure
b. Introduction of bundled insurance, (partially) compulsory systems or public-private partnerships to ensure long-term affordability

3. maximize investment incentives
a. Encourage private investment in climate adaptation through tax incentives, subsidized loans and government guarantees
b. Create planning security for companies

4. provide targeted support for research and development
a. Increased public funding, tax incentives and public-private partnerships for climate-friendly innovations
b. Specialized funds of funds to promote new technologies and risk diversification

5. reform financial equalization
a. Provide more targeted support to regions with higher climate risk
b. Give municipalities more autonomy in raising funds for adaptation measures

Downloads:

Study - Final report: Adaptation to climate change - What positive economic effects can be expected?