Poland’s losses due to climate change are estimated at PLN 70 billion
In Poland, over the past 40 years, losses incurred as a result of climate change have been estimated at EUR 16 billion (approx. PLN 70 billion). In 2021 alone, the total value of damages paid out for natural disasters amounted to PLN 994 million – says a report by the Polish Insurance Chamber (PIU).
Increase in global temperature by 2 degrees Celsius by 2050 is the most likely scenario. If this happens extreme droughts will occur 2.4 times more often than in the pre-industrial era.
Climate change has a negative impact on the economies of all countries. The report drafted by PIU and EY shows that in Poland, the relative decline in GDP will be 3 percent in a positive scenario, in which the goals set out in the Paris Agreement would be achieved. GDP will fall by more than 10%if the temperature rise will be consistent with pessimistic forecasts.
“The consequences of disasters are not only direct losses, i.e. deaths, destroyed property and infrastructure in the impacted area. It is also disruptions in supply chains affecting the entire society and the functioning of the state. Economic models assume that, according to the worst forecasts, due to devastating weather events, Poland’s GDP may decrease by as much as 10 percent by 2050,” says the report’s second edition. The PIU’s report is titled “The climate of growing losses. The role of insurance in climate protection and the energy transition”, and was developed in collaboration with EY.
The authors of the report indicate that the number of natural disasters in the world is growing. In addition, a further increase in the average global temperature is still forecast, which will result in further devastating weather events.
Experts have stressed for years that if appropriate action is not taken, the negative impact of extreme weather events should be expected.
In this situation, the systemic preventive measures referred to in the PIU report are particularly important. They include spatial planning that takes into account potential climate risks, introducing updated building standards, maintaining the appropriate technical condition of engineering facilities or exchanging information.
The PIU report notes that the energy transition is a key direction in preventing further rapid climate change. The energy sector is responsible for about 73 percent of global greenhouse gas emissions.
“In our opinion, the green transformation will not be possible without the involvement of insurance and reinsurance companies. Their products provide financial security for investors, designers, contractors, as well as operators of new facilities. Insurers also play a special role as institutional investors, redirecting financial flows to companies and projects that contribute to the fight against climate change,” said Marcin Sadek, partner at EY.
We witnessed the negative impact of heat and drought on the economy in 2022. In the summer, record temperatures were recorded throughout Western Europe, in the British Isles even 40 degrees Celsius. This set a record for power consumption. The heat was accompanied by a shortage of precipitation, which caused river levels to drop to extremely low values. Due to the lack of sufficient water, there have been significant restrictions on the production of electricity in hydropower and nuclear power plants. This, in turn, contributed to a sharp increase in prices on the electricity exchanges.
According to the PIU report, the total losses suffered by all EU countries as a result of climate change in the last 40 years amounted to EUR 487 billion euros. In Poland, losses due to this reached EUR 16 billion (about 70 billion PLN).
In 2016-2021, insurance companies reported 273 events to the Financial Supervision Commission, which they assessed as catastrophic. They paid out PLN 3.622 billion in damages. The greatest damage was caused by heavy rains, flooding, storms, hail and hurricanes.
Polish Insurance Chamber / Jacek Perzyński
Poland’s gas storage 85% full
“The underground gas storage facility in Brzeźnica, podkarpackie region, has reached its maximum capacity,” said Anna Łukaszewska-Trzeciakowska, the Government Plenipotentiary for Strategic Energy infrastrcuture.. “The level of filling of gas storage facilities in Poland is already 85 percent,” she added.
“Boom! The first gas storage facility is full at 100%. The underground gas storage facility in Brzeźnica has reached its maximum capacity. Poland’s gas storage is 85% full and the gas is still coming. Thanks to the Baltic Pipe and the LNG terminal, we are safe, ” Łukaszewska-Trzeciakowska tweeted last Thursday.
The Baltic Pipe is a joint investment of Gas Transmission System Operators from Poland and Denmark – Gaz-System and Energinet. The owner and operator of the section starting on the shore of the Danish island of Zealand and running to Poland along the bottom of the Baltic Sea is Gaz-System. The construction of the Baltic Pipe was completed in 2022.
The LNG Terminal in Świnoujście named after President Lech Kaczyński has been operating since 2016, last year 58 methane carriers arrived at the terminal. In 2023, the plan is to serve over 60 ships. The second phase of the terminal expansion is also underway, which is expected to be completed at the turn of 2023 and 2024.
Polish Press Agency / Jacek Perzyński