Economics of Climate Change: Costs and Benefits of Adaptation Measures for Climate Change
Within the "German Strategy for Adaptation to Climate Change", it is necessary to compare and prioritize different adaptation measures. One approach is to use economic instruments, especially cost-benefit analyses. However, there is also a need to evaluate adaptation options related to several different sectors, i.e. health, forestry, agriculture, and energy. In addition, costs and benefits are distributed over long time frames and are subject to high levels of uncertainty. Ecologic Institute, together with the project partners INFRAS and Fraunhofer ISI, will compile the status quo for economic analyses of adaptation measures, develop economic criteria for cost-benefit analyses and conduct such cost-benefit analyses for several adaptation measures.
The German Strategy for Adaptation to Climate Change was adopted by the German Federal Government in December 2009. The strategy covers 15 sectors; the adaptation measures in these 15 sectors are developed on the basis of sectoral assessments. For the evaluation of policy options, however, a valuation of cross-sectoral costs and benefits is necessary.
Against this backdrop, it is necessary to evaluate the existing methodology for the assessment of adaptation measures and to develop consistent instruments to be used for cost-benefit analyses that are also applicable to adaptation to climate change.
The aims of the project are to:
- Conduct a literature review on the economic costs and benefits of adaptation to climate change,
- Develop economic criteria for the evaluation of cross-sectoral adaptation measures,
- Consolidate and harmonize the results of a cost-benefit analysis of adaptation with the aim of making adaptation measures comparable,
- Enlarge and deepen available information with the help of cost-benefit analyses for several adaptation measures.
Ecologic Institute and the project partners will analyse literature from Germany and, if findings can be transferred, also from other European and non-European countries. The project additionally includes expert interviews and a workshop to be held at the end of the project.