EU Shifts Focus from Emissions to Climate Adaptation Amid Rising Costs

The European Union is shifting its focus from reducing emissions to adapting to the effects of climate change. According to Teresa Ribera, executive vice-president of the European Commission, policymakers need to consider adaptation as a key focus of economic policy due to the growing costs of climate-related extreme events.

Between 2021 and 2024, climate-related extreme events led to more than €200 billion in economic losses in the EU. Ribera emphasizes that this is not sustainable, and investment is needed to reduce these impacts and costs. The EU's new adaptation framework, due for release later this month, will include proposed legislation requiring member states to develop climate resilience plans as a prerequisite to funding.

Ribera notes that while the EU's long-term goals remain the same, there may be tougher regulations in the future. This change is seen as a wake-up call for businesses and governments to confront costs they have largely been able to defer.

The EU is working with insurers to expand coverage where it makes sense while also using public and private financing to cover risks that cannot be covered by insurance alone. Ribera believes incorporating climate into the core of economic planning will help protect the economy from growing climate-related risks.