Gabriel Bachner

Assessing the benefits of organized voluntary emergency services

Purpose – The purpose of this paper is to reveal the benefits of organized voluntary emergency services (OVES) in the case of flood events, since such information is mostly not available, but needed to analyze the total effects of disasters and respective responses. Moreover, the efficient allocation of scarce public resources for emergency and risk management should be based on empirical data. Design/methodology/approach – Based on a qualitative framework describing the benefits of OVES, the authors develop different tools for monetizing tangible as well as intangible benefits and apply them for case studies in Austria. Findings – The benefits of volunteer efforts for emergency management cannot be monetized easily, since they are often of intangible character. Nevertheless, we show that the benefits of OVES could be substantial. Research limitations/implications – As the authors analyze case studies, the results cannot be directly transferred to other regions, but illustrate the empirical dimension of t...

Economic Evaluation Framework and Macroeconomic Modelling

The first step in an economic assessment of climate change impacts at the country level is the identification of so-called “impact fields”. These fields can be either single economic sectors, parts of sectors or aggregates of sectors. For the case of Austria that is explored in this book, 12 impact fields are identified and investigated regarding climate change impacts and the resulting economic costs and benefits. As impact fields are often of very different character, the mechanisms of climate change impacts are different and, therefore, also the costing methods to obtain costs and benefits of climate change are diverse. Hence, depending on the impact field, one or several of the following costing methods are applied: Changes in production technology and subsequent production cost structure, changes in productivity, changes in final demand, changes in investment, changes in public expenditures, and, finally, level of replacement cost. By applying these methods we obtain the direct costs by impact field.

Macroeconomic Evaluation of Climate Change in Austria: A Comparison Across Impact Fields and Total Effects

This chapter evaluates the aggregate macroeconomic effects of the quantifiable impact chains in ten impact fields for Austria: Agriculture, Forestry, Water Supply and Sanitation, Buildings (with a focus on heating and cooling), Electricity, Transport, Manufacturing and Trade, Cities and Urban Green, Catastrophe Management, and Tourism. First, the costing methodology used for each impact chain as well as the respective interface to implement them within the macroeconomic model are reviewed and compared across impact fields. The main finding here is that gaps in costing are mostly the consequence of insufficient data and for that reason, the two important impact fields Ecosystem Services and Human Health could not be assessed in monetary terms. Second, for the subset of impact chains which could be monetised, a computable general equilibrium (CGE) model is then used to assess the macroeconomic effects caused by these. By comparing macroeconomic effects across impact fields, we find that the strongest macroeconomic impacts are triggered by climate change effects arising in Agriculture, Forestry, Tourism, Electricity, and Buildings. The total macroeconomic effect of all impact chains—which could be quantified and monetised—is modest up to the 2050s: both welfare and GDP decline slightly compared to a baseline development without climate change. This is mainly due to (a) all but two impact chains refer to trends only (just riverine flooding damage to buildings and road infrastructure damages cover extreme events), (b) impacts are mostly redistribution of demand, while stock changes occurring as a consequence of extreme events are basically not covered and (c) some of the precipitation-triggered impacts point in opposite directions across sub-national regions, leading to a comparatively small net effect on the national scale.

Water Supply and Sanitation

The Water Supply and Sanitation (WSS) sector is a complex system that involves all, specific and geographically bound natural water resources; vast and diverse technical infrastructure; and a strong nexus to lifestyle and consumer behaviour. Therefore the sensitivity to changes, including climate changes, originates from many levels.

Assessing the economy-wide effects of climate change adaptation options of land transport systems in Austria

Due to climate change, transport systems are expected to become increasingly stressed by extreme weather and gradual climatic changes, resulting in direct costs within the affected sectors as well as indirect costs from sectoral interlinkages. To reduce these costs, sector-specific climate change adaptation measures are needed, raising the question of the net benefits of adaptation at a macroeconomic level. However, despite their importance such assessments of impacts and adaptation at the macrolevel are scarce and coarse in their implementation. This paper contributes to fill this research gap by analyzing specific adaptation measures for the road and rail sectors in Austria using a computable general equilibrium model. The findings are as follows: First, direct impact costs more than double due to macroeconomic linkages. Hence, the indirect costs are found to be larger than the direct costs. Second, when analyzing adaptation measures for the road and rail sectors, without capturing any indirect effects, benefit–cost ratios imply a clear benefit only for the rail sector. However, when indirect effects via sectoral interlinkages are also captured, adaptation measures in both sectors, road and rail, clearly pay off. Climate change-induced GDP and welfare losses are reduced by 55 and 34% and lead to positive employment effects. Third, even at rather low damage reduction potentials, adaptation leads to a net benefit at the macroeconomic level.

Modeling for insights not numbers: The long-term low-carbon transformation

Limiting global warming to prevent dangerous climate change requires drastically reducing global greenhouse gases emissions and a transformation towards a low-carbon society. Existing energy- and climate-economic modeling approaches that are informing policy and decision makers in shaping the future net-zero emissions society are increasingly seen with skepticism regarding their ability to forecast the long-term evolution of highly complex, nonlinear social-ecological systems. We present a structured review of state-of-the-art modeling approaches, focusing on their ability and limitations to develop and assess pathways towards a low-carbon society. We find that existing methodological approaches have some fundamental deficiencies that limit their potential to understand the subtleties of long-term low-carbon transformation processes. We suggest that a useful methodological framework has to move beyond current state of the art techniques and has to simultaneously fulfill the following requirements: (1) representation of an inherent dynamic analysis, describing and investigating explicitly the path between different states of system variables, (2) specification of details in the energy cascade, in particular the central role of functionalities and services that are provided by the interaction of energy flows and corresponding stock variables, (3) reliance on a clear distinction between structures of the sociotechnical energy system and socioeconomic mechanisms to develop it and (4) ability to evaluate pathways along societal criteria. To that end we propose the development of a versatile multi-purpose integrated modeling framework, building on the specific strengths of the various modeling approaches available while at the same time omitting their weaknesses. This paper identifies respective strengths and weaknesses to guide such development.

Evaluating Health Co-Benefits of Climate Change Mitigation in Urban Mobility

There is growing recognition that implementation of low-carbon policies in urban passenger transport has near-term health co-benefits through increased physical activity and improved air quality. Nevertheless, co-benefits and related cost reductions are often not taken into account in decision processes, likely because they are not easy to capture. In an interdisciplinary multi-model approach we address this gap, investigating the co-benefits resulting from increased physical activity and improved air quality due to climate mitigation policies for three urban areas. Additionally we take a (macro-)economic perspective, since that is the ultimate interest of policy-makers. Methodologically, we link a transport modelling tool, a transport emission model, an emission dispersion model, a health model and a macroeconomic Computable General Equilibrium (CGE) model to analyze three climate change mitigation scenarios. We show that higher levels of physical exercise and reduced exposure to pollutants due to mitigation measures substantially decrease morbidity and mortality. Expenditures are mainly born by the public sector but are mostly offset by the emerging co-benefits. Our macroeconomic results indicate a strong positive welfare effect, yet with slightly negative GDP and employment effects. We conclude that considering economic co-benefits of climate change mitigation policies in urban mobility can be put forward as a forceful argument for policy makers to take action.

The Effects of Climate Change Impacts on Public Budgets and Implications of Fiscal Counterbalancing Instruments

Climate change impacts have manifold effects on public budgets. In this paper, we therefore use a computable general equilibrium framework to consistently analyze how both the expenditure and revenue side of public budgets are affected via climate change impacts in ten different impact fields in Austria by mid-century. We then investigate different options how reductions in public service provision can be counterbalanced by fiscal instruments or by foreign lending and the associated economy-wide effects. We find that without counterbalancing, climate change impacts on the government budgets are doubled when considering not only the direct effect on the expenditure side but also macroeconomic feedback effects which reduce the overall tax base. With counterbalancing, we find significant differences in budgetary and macroeconomic consequences across fiscal instruments. While an increase of the capital tax as well as a cut in transfers reduce the welfare losses of climate change, higher labor taxes amplify welfare losses. This is because higher labor taxes dis-incentivize employing labor, thereby increasing unemployment and unemployment payments by the government. A higher output tax also increases welfare losses, but less strongly than an increased labor tax. Finally, increased foreign lending reduces welfare losses twice as much as the cut in transfers or the increased capital tax in the short term, but leads to a higher deficit and government debt.

Buildings: Heating and Cooling

While energy savings in buildings is among the key prerequisites for a low-carbon future, our ability to maintain temperatures in buildings within a specific comfort range, and thus our demand for heating and cooling energy, are also highly sensitive to climate change. We quantify two main impact chains: (1) a higher temperature in winter leads to a reduction of heating energy demand and (2) a higher temperature in summer leads to an increase in demand for cooling. The demand for cooling energy depends largely on the future uptake of air conditioning in the building sector and is subject to considerable uncertainty. On quantifying these two impacts for the example of Austria for the period around 2050 a net saving of about 230 million euros per year is found, triggering slightly positive effects on welfare and GDP. The result is depending on the development of energy prices and in particular by the ratio of electricity to fuel price in the heating sector. The results show that, in absolute terms, the energy reduction in heating is much higher than the increased energy demand for cooling for the time horizon and the geographical location investigated. This stems from the fact that energy demand for air conditioning in Austria in 2008 was only 0.4–0.5 % of the final energy demand for heating. The impacts and costs resulting from a strong increase in electricity peak loads in summer are investigated in Chap. 14 (Electricity).