The economic cost of the climate crisis

For a few years now, the effects of the climate crisis have been clearly visible. Whether it's summer, autumn, winter, or spring, the corresponding temperatures are increasingly higher, and the associated meteorological phenomena, however common they may be, gain in intensity season after season. During heat waves, the thermometer rises higher than ever (and drops less than ever in terms of nighttime lows); during transition periods, the warmed seawater carries more weight than ever before in storms, whether they are associated with a cold snap or not; and winters with little rain are increasingly frequent and longer, opening the door to more periods of drought. And of course, the particular combination of these factors leaves many forests at the mercy of the flames: we are becoming familiar with sixth-generation fires, those that are beyond the capacity to attack them.

This weekend we published a dossier dedicated to Montseny, a massif that is drowning because the climate regime is changing and the management that was done (or wasn't done) has become obsolete. And even on Saturday Two expert researchers, Rachel Lowe and Kim van Daalen, warned about the effect of rising temperatures on infectious diseases of animal origin and urged politicians and administrations to take measures to adapt to the climate crisis.

Now we can add more information on a specific aspect, which should serve to increase this pressure but also to convince the still too high number of people who do not accept or do not see clearly the climate crisis: the economic cost. Much has been said about the environmental cost, the social cost, and the economic cost at the individual or local level (cost due to the initial impact). But the real global cost emerges slowly, because it manifests itself through several channels. In this sense, the University of Mannheim, under the auspices of economists from the European Central Bank, has produced the most ambitious study to date in this field, and the figures are conclusive: the cost of heat waves, droughts, and floods each summer across Europe was €31 billion in 2020. and is projected to reach €126 billion by the summer of 2029.

In the case of Catalonia, the study, led by Dr. Sehrish Usman, estimates this summer's cost at €1 billion, and the projection for 2029 is €6 billion. Overall, Spain, along with France and Italy, leads the list of countries with the highest costs due to this reason. In Spain's case, €12 billion this summer and €34 billion in 2029.

The calculation is based on an analysis of heat, drought, and flooding in relation to productivity. Construction and hospitality in the first case, agriculture in the second, and infrastructure, buildings, and supply chains in the third are the main victims. But the chain of impacts extends to almost all economic activity.

This bill, likewise, does not end there. Because the effects of forest fires weren't included in the study, and because the researchers' calculations were deliberately made from a conservative perspective. A downward trend, in short.

The climate crisis, and rising temperatures in particular, have a very visible impact. We imagined the other impact, the bill, but now we're starting to put numbers, data, and science into it. Adaptation must be macroeconomic, too. And we have to act before the €6 billion or €126 billion do more damage than necessary.