CMCC has been awarded the service contract “Study on The cost of climate change on households and families in the EU”, funded by the European Commission. The aim of this study is to document the costs of climate changes (impacts, mitigation policies and adaptation measures) for the households in the European Union and their implications on income distribution and poverty indices.

General Objectives

The aim of this study is to assess how the climate change costs are distributed across EU households and families in the recent past and in the future up to 2050. The analysis will offer:

1. a snapshot of multiple climate related risks for the EU Member States,
2. the profile (income, age, location) of households that will experience the highest costs due to climate change,
3. a set of quantitative indicators of climate change related variations of inequality and poverty in EU;
4. an overview of possible measures that the EU or single Member States could implement to favor an equal distribution of climate change burden.

Expected Results

A tentative list of results includes:

• Exposure to weather/climate risk by income decile and age stratification;
• Total and sectoral expenditure due to selected weather/climate risk by income decile and age stratification;
• Total and sectoral expenditure for adaptation by income decile and age stratification;
• Total and sectoral relative-to-expenditure measures of the welfare loss due to weather/climate risk. These can be defined as relative compensating variations (Mansur et al., 2008), i.e. the welfare loss is given by the difference between the amount spent today by the household and the amount it will spend in the future, divided by household’s future income;
• Poverty and inequality indicators at country/NUTS level e.g., absolute poverty rate, Gini index, inter quantile income share ratios, energy poverty and food poverty indicator (expenditure based).