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University of Graz News University of Graz study shows: public money for climate adaptation pays off

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Thursday, 05 February 2026

University of Graz study shows: public money for climate adaptation pays off

Modern office district in the city center. New glass high-rise buildings with a pedestrian walkway and a small park with trees in the business center.

More greenery in cities protects residents from heat. This saves the state from illness-related costs and tax revenue losses due to declining productivity. Photo: Jan/Adobe Stock

In order to plug the budget gap, the state is currently pinching pennies. However, when it comes to adapting to climate change, investing helps to save money. This is shown by a recently published study by the Wegener Centre at the University of Graz. "Our analyses show that protective measures more than pay off in the medium term," summarises lead author Eva Preinfalk.

Droughts, floods and forest fires place a double burden on the public purse. On the one hand, state money endows the disaster fund, which compensates those affected and finances the reconstruction of destroyed infrastructure. Secondly, the treasury loses tax revenue when harvests fail or productivity falls. Austria already invests around 600 million euros a year in climate change adaptation, for example in protective structures or renaturalisation. "We have compared these funds with the average damage to be expected from climate impacts by 2050," explains Preinfalk. "The modelling clearly shows that the expenditure is profitable for the state budget," the researcher sums up. With adaptation, tax revenues are 1.7 billion euros higher per year than in a scenario without additional investment. Savings measures in this area would therefore lead to significantly higher costs in the medium term.

Increasing risk
Austria is endeavouring to arm itself against 100-year floods throughout the country. Densely populated urban areas in particular are already able to withstand much more severe events. "However, as the intensity of storms increases, it is foreseeable that existing protection levels will be exceeded more and more often," warns Preinfalk. In 2024 the Vienna River even threatened to overflow the city during a thousand-year flood. Adaptation does not necessarily have to be expensive: "It would help a lot to take targeted measures into greater consideration when planning new buildings, renovating existing infrastructure or in agriculture and forestry," the researcher recommends. Information campaigns - for example in the health sector - would also make a relevant contribution.

Publication:
Eva Preinfalk, Nina Knittel, Birgit Bednar-Friedl, Gabriel Bachner, Elisa Sainz de Murieta, Max Tesselaar: Fiscal implications of public climate change adaptation: An analysis of three European countries, Ecological Economics

created by Dagmar Eklaude

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