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Newly released study estimates potentially disastrous economic impact of climate crisis: 'It's devastating'

"The inequality dimension was really shocking."

"The inequality dimension was really shocking."

Photo Credit: iStock

A new study in the journal Nature predicted that the costs of environmental damage from a warming world will be six times higher than the price of limiting global temperature rise to 2 degrees Celsius.

The data projects that rising temperatures, heavier rainfall, and more frequent extreme weather will cause devastating economic losses in the coming decades, according to the Guardian.

What's happening?

The study finds that a hotter Earth could slash average incomes worldwide by nearly 20% by 2050 as compared to a world without accelerated warming. The damage is projected to cost a staggering $38 trillion each year.

"It's devastating," said Leonie Wenz, a scientist at the Potsdam Institute for Climate Impact Research and one of the study's authors. "I am used to my work not having a nice societal outcome, but I was surprised by how big the damages were. The inequality dimension was really shocking."

The economic hit is more than double the previous estimates, because of the study's more comprehensive analysis of local weather impacts on elements like crop yields and worker productivity.

Why is this inequality concerning?

The findings underscore the urgent need to invest in solutions now.

While the worst impacts will hit the poorest countries that have contributed least to the problem, even wealthy nations like the U.S., Germany, and France could see incomes fall over 10% by mid-century, the study said.

If carbon and methane pollution continue to rise, the authors project income losses of over 60% by 2100. That would be catastrophic for the global economy and human well-being.

Even these alarming figures likely underestimate the full toll, as the study didn't incorporate impacts like heatwaves, sea level rise, or health costs.

What's being done about rising temperatures?

The good news is that strong action to curb pollution could stabilize losses at around 20%. The study found that the price tag for shifting to clean energy is a fraction of the economic damage from unmitigated warming.

By 2050, moving to renewables and other environmental solutions is estimated to cost $6 trillion — less than one-sixth of that year's projected damage of $38 trillion. It's far cheaper to solve this crisis than to suffer the consequences of denial and delay.

As the costs of our overheating planet come into sharper focus, more people are realizing the benefits of going green. Each low-carbon choice, whether it's buying clean energy, eating more plants, or insulating your home, is an investment in a safer future.

When our daily decisions align with our values, we're not just boosting our own bottom lines. We're building a cooler, more resilient world for everyone. So, next time you weigh an eco-friendly option, remember — it's not just good for the planet. Chances are, it's good for your wallet, too.

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