Energy for cooling and heating: climate change impacts on energy demand of Italian households

11:15 Wednesday 29 May

SS022 • OC131

Room S16


Lorenza Campagnolo (Italy) 1; Enrica Decian (Italy) 1

1 - Ca'Foscari University and CMCC@Ca'Foscari

The paper aims at assessing the distributional implications of future climate warming, i.e. rising frequency of hot days as well as reduced occurrence of cold days, on the use of energy for space heating and cooling by Italian households. We will describe both direct (short-run) impacts at household level and higher-order effects passing trough price, income and consumption adjustments, and assess whether the burden of additional energy expenditure falls disproportionately on poorer households.

The analysis relies on spatially and qualitatively heterogeneous data: grid cell-level energy demand change, household survey microdata for Italy, and future macroeconomic projections at NUTS 2 level. A multi-approach methodology will combine these data.

Estimated grid cell-level demand response to changes in the frequency of hot and cold days under different RCPs and SSPs scenarios will be upscaled at NUTS 2 level and matched with household location in the survey. Assuming no-behavioural adjustments after the climate shock, Italian households will experience an excess (shortfall) of their expenditure to cope with the higher temperature. This offers a rough assessment of heterogeneous direct impact of global warming on Italian families related to current household characteristics and location of expected physical impacts. Looking at the distribution of this burden, we will highlight regressive / progressive / neutral implication of energy for adaptation.

In order to capture higher-order impacts, we will rely on a regionalised (NUTS 2 level) Computable General Equilibrium (CGE) model for Italy. After building business as usual scenarios describing future socio-economic patterns for the 20 Italian regions under different SSPs up to 2050, we will analyse how climate change related energy demand shocks will spread into the economy, altering prices of energy goods, production costs in non-energy sectors, income and consumption in different regions. The overall outcome will be then downscaled at household level. This methodology will allow comparing the burden of direct and indirect climate change impacts on energy demand by Italian households and its overall distribution implications.