Details
- Identification
- Discussion Paper 237
- Publication date
- 4 December 2025
- Authors
- Nicola Gagliardi | Directorate-General for Economic and Financial Affairs
Description
This paper provides a stylised approach to integrate the macro-fiscal impacts of climate change and climate action in a standard macro-fiscal surveillance framework.
Highlights:
- Climate change entails macro-fiscal risks from both physical impacts and the transition to a low-carbon economy.
- Achieving EU climate targets requires major investment and mobilisation of private finance.
- Fiscal structures will shift as carbon pricing expands and fossil-fuel revenues decline.
- Early climate action implies upfront costs but prevents larger long-term damages.
- Macroeconomic and distributional effects will differ across Member States.
- Integrating climate risks into fiscal frameworks is essential for credible and resilient public finances.
Information and identifiers
Discussion Paper 237. December 2025. Brussels. PDF. 136pp. Tab. Graph. Bibliogr. Free.
KC-01-25-059-EN-N (online)
ISBN 978-92-68-31831-7 (online)
ISSN 2443-8022 (online)
doi:10.2765/3311889 (online)
JEL classification: H5, H63, Q51, Q54, Q58
Disclaimer
European Economy Discussion Papers are written by the staff of the European Commission’s Directorate-General for Economic and Financial Affairs, or by experts working in association with them, to inform discussion on economic policy and to stimulate debate. The views expressed in this document are solely those of the author(s) and do not necessarily represent the official views of the European Commission.
