Calculating the Heating Bill: Climate Change to Cost Germany €800 Billion
A new report predicts that climate change will cost Germany a staggering €800 billion by 2050 -- with higher energy costs, declining tourism, increased insurance costs and damage caused by extreme weather.
Scientists agree that climate change is on the way. But what's it going to cost? In Germany alone the price tag will be immense: up to 800 billion. That, at least, is the latest prediction from the German Institute for Economic Research (DIW) released Wednesday.
The DIW study is based on the assumption that the average global temperature will increase by 4.5 degrees Celsius. That is the upper level of the forecast by the UN Intergovernmental Panel on Climate Change (IPCC). In February the body released a report based the evaluation of countless studies and models and came to the conclusion that the average temperature will rise by between 2 and 4.5 degrees Celsius by 2100.
The DIW findings are based on a range of different costs resulting from climate change. Direct damage will cost the economy around 330 billion, with the tourism, agriculture and insurance sectors most effected. For example, if temperatures increase by as much as 4.5 degrees Celsius, then German ski resorts will be "snow-free."
The projected increased energy costs will amount to around 300 billion, a lot of which will have to be born by private households. A further 170 billion will be required for measures to deal with the consequence of climate change, such as protection walls and dikes.
Germany is going to have to reduce its reliance on coal.
The institute predicts that the costs incurred will dampen economic growth by up to 0.5 percent a year over the next 50 years. And almost every economic sector will be hit.
This is not the first time the economic costs of global warming have been laid bare. In a report last November, the British government adviser Nicholas Stern recommended that one percent of national GDP should be set aside each year to offset the costs of climate change.
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