Investments in flood defences and other adaptation measures could reduce UK losses from climate change impacts by 30% even under high warming scenario
Without significantly more action to adapt and build resilience, climate change will damage UK productivity and put lives and businesses at risk, according to new research published today (18 SEPTEMBER 2026) by the Grantham Research Institute on Climate Change and the Environment at the London School of Economics and Political Science.
The new study on ‘Economic opportunities from investing in climate resilience in the UK’ found that if the UK population experiences a “High Warming” scenario, with a temperature rise of 3.4°C by the 2050s compared with the pre-industrial level, it would suffer welfare losses, measured in terms of cuts in production and consumption, equivalent to at least 4.2 per cent of GDP at current levels of resilience to climate change impacts.
Investments in stronger flood defences and other adaptation measures could reduce these losses by about 30 per cent, according to the study.
It states: “The United Kingdom is experiencing significant economic impacts from climate change, and these will increase in future decades. Without comprehensive and well-funded adaptation strategies, risks will grow, including from agriculture losses, flooding, and impacts on health and productivity.”
The study was led by Dr James Rising of the University of Delaware, and was designed to inform His Majesty’s Treasury and other fiscal decision-makers on potential targets for adaptation funding.
It states: “Projected domestic risks could be reduced by nearly 30% with strategic investments in climate-adaptation measures such as flood defences and more climate-resilient infrastructure starting at the levels outlined in the UK’s third National Adaptation Programme (NAP3) and related government strategies, and increasing proportionately over time in relation to rising risk”.
The study points out that the UK population had already experienced warming of about 2.1°C by 2025, with estimated welfare losses equivalent to at least 2 per cent of GDP from climate change impacts.
The study also notes: “By the 2050s, extreme events linked to climate change could result in large-scale disruptions across the UK economy”, if there is no significant improvement in resilience.
It states: “Estimates suggest there is a 1-in-200-year risk of one or more of the following in a single year: agricultural losses exceeding £10 billion, flood damages exceeding £60 billion, labour productivity losses exceeding £70 billion and heat-related excess mortality exceeding 21,000 deaths.”
The study presents the initial results for the UK of the PROSPER (Physical-risk & Resilience Outcomes for Spending, Planning & Economic Returns) research project. It captures economic risks and adaptation opportunities in agriculture, flood and coastal management, health, and labour productivity. It also estimates UK-wide risks from trade spillovers, catastrophic economic risks and other expert-assessed channels.
The study stresses that improving adaptation is not an alternative to cutting greenhouse gases. It states: “While adaptation measures bring major benefits, strengthened global efforts to mitigate climate change remain critical. Projections suggest that avoiding a High Warming climate scenario will halve domestic economic risks in the UK, highlighting the importance of pursuing strong international action on climate change.”
Dr James Rising, Visiting Fellow at the Grantham Research Institute on Climate Change and the Environment, said:
“This new research responds directly to decision-makers who want to plan for a severe plausible future, and make the investments needed to avoid the worst risks.
“Worsening food shortages, economic shocks and increasing excess deaths all should be expected if we don’t prioritise adaptation.
“The benefits of adaptation far exceed the costs, whether you measure it in economic, financial, or fiscal terms. Governments should invest in adaptation now to get the greatest returns.”
Professor Nicola Ranger, Executive Director of Earth Capital Nexus at the London School of Economics and Political Science, said:
“These are not distant or abstract risks. Climate change is already costing the UK lives, damaging businesses and farms, and undermining growth and productivity. This research shows how dramatically those costs could escalate without urgent action.
“Yet the Government is still not treating adaptation with anything like the seriousness required. The Climate Change Committee found no area of adaptation in which delivery could be rated ‘good’. We know what needs to be done, and we know that acting early is far cheaper than repeatedly paying for avoidable damage.
“Climate resilience is essential to the new Government’s ambitions for growth, prevention and stronger local economies. Businesses cannot invest and communities cannot prosper if floods, droughts and extreme heat repeatedly disrupt infrastructure, public services and supply chains. Adaptation must therefore become a core economic priority – embedded in Treasury decisions and delivered through sustained investment and locally led action. The costs of continued delay are simply too high.”