Assessing Macro-economic Effects of Climate Impacts on Energy Demand in EU Sub-national Regions

European policy makers are increasingly interested in higher spatial representations of future macro-economic consequences from climate-induced shifts in the energy demand. Indeed, EU sub-national level analyses are currently missing in the literature. In this paper, we conduct a macro-economic asse...

Full description

Saved in:
Bibliographic Details
Published in:Environmental & resource economics 2023-10, Vol.86 (1-2), p.173-201
Main Authors: Standardi, Gabriele, Dasgupta, Shouro, Parrado, Ramiro, De Cian, Enrica, Bosello, Francesco
Format: Article
Language:English
Subjects:
Agribusiness
Agricultural industry
Climate change
Climate effects
Climatic data
Cooling
Economic Policy
Economics
Economics and Finance
Electricity
Energy
Energy demand
Environmental assessment
Environmental Economics
Environmental impact
Environmental Law/Policy/Ecojustice
Environmental Management
Equilibrium
GDP
Gross Domestic Product
Macroeconomics
Mitigation
Petroleum
Petroleum industry
Policy making
Regional development
Regional differences
Spatial analysis
Spatial discrimination
Spatial resolution
Winners
Citations: Items that this one cites
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:European policy makers are increasingly interested in higher spatial representations of future macro-economic consequences from climate-induced shifts in the energy demand. Indeed, EU sub-national level analyses are currently missing in the literature. In this paper, we conduct a macro-economic assessment of the climate change impacts on energy demand at the EU sub-national level by considering twelve types of energy demand impacts, which refer to three carriers (petroleum, gas, and electricity) and four sectors (agriculture, industry, services, and residential). These impacts have been estimated using climatic data at a high spatial resolution across nine Shared Socioeconomic Pathway (SSP) and Representative Concentration Pathway (RCP) combinations. The impacts feed into a Computable General Equilibrium model, whose regional coverage has been extended to the sub-national NUTS2 and NUTS1 level. Results show that negative macroeconomic effects are not negligible in regions located in Southern Europe mainly driven by increased energy demand for cooling. By 2070, we find negative effects larger than 1% of GDP, especially in SSP5-RCP8.5 and SSP3-RCP4.5 with a maximum of − 7.5% in Cyprus. Regarding regional differences, we identify economic patterns of winners and losers between Northern and Southern Europe. Contrasting scenario combinations, we find that mitigation reduces adverse macro-economic effects for Europe up to a factor of ten in 2070, from 0.4% GDP loss in SSP5-RCP8.5 to 0.04% in SSP2-RCP2.6.
ISSN:0924-6460
1573-1502
DOI:10.1007/s10640-023-00792-4