NGFS publishes the third vintage of climate scenarios for forward looking climate risks assessment
NGFS has published the third vintage of the climate scenarios along with two accompanying documents, aimed at fostering the integration of climate-related risks into the work of central banks and supervisors, and beyond.
- An updated Set of climate scenarios: In this third vintage, the NGFS scenarios have been brought up to date, including the most recent country-level climate commitments made at the COP26 in 2021, and the latest GDP and population pathways. For the first time, the NGFS scenarios include projections of the potential losses from extreme weather events (floods and tropical cyclones), in addition to the specific impacts of chronic climate changes on the macroeconomy. The NGFS scenarios are also consistent with the scenarios assessed in the Sixth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC). Owing to the lead time required for their completion, the NGFS scenarios could not account for the consequences of the war in Ukraine and the current energy crisis. Yet, they remain informative about the current situation, illustrating the challenges as well as the feasibility and benefits from carrying on with the net zero transition.
- A technical analytical document on the “Climate Scenarios Sensitivity Analysis to Macroeconomic Policy Assumptions”: This document explores the policy conditionality of the third vintage of the NGFS scenarios, and assesses the sensitivity of the results to assumptions related to fiscal and monetary policy.
- A guidance note summarizing “Practical Lessons for the Development of Climate Scenarios with Extreme Weather Events from Emerging Markets and Developing Economies”: This note aims to complement existing climate risk assessment literature by providing central banks and prudential supervisory authorities with a practical framework for assessing physical climate risks with extreme weather events.
The NGFS scenarios were developed in partnership with an academic consortium including the Potsdam Institute for Climate Impact Research (PIK), the International Institute for Applied Systems Analysis (IIASA), the Center for Global Sustainability at the University of Maryland (UMD), Climate Analytics (CA), and the National Institute of Economic and Social Research (NIESR).