Written by: Salma El Sakka
European Central Bank President Christine Lagarde has called on Europe to strengthen climate-related insurance, increase investment in energy infrastructure, and help companies generate their own electricity, warning that last summer's extreme heatwave should serve as a wake-up call.
Ahead of the COP31 summit scheduled for next week in Antalya, Turkey, Lagarde said that heatwaves, droughts, and wildfires have revealed vulnerabilities in Europe's economy and energy system, which will be exacerbated by rising global temperatures.
Call for a public-private reinsurance program
Lagarde, who announced her resignation last week and will leave her position on February 7, urged the European Union to work on a public-private reinsurance program against climate disasters, noting that historically, only a quarter of disaster losses in Europe were covered by insurance.
Returns on electricity grid investment
Lagarde cited industry research stating that every euro invested in grid modernization saves more than two euros in other system costs, while improved storage will help transport cheap solar energy to the evening, when heatwaves strain supplies.
Unified rules for connecting private generators
She also called for unified rules that allow companies owning private generators and batteries to quickly connect to the grid to provide support during peak times, emphasizing that most of this investment should come from the private sector without mentioning any financing from the Central Bank.
COP31 Agenda
The European Union will use the upcoming COP31 summit to push for an agreement on a "package" of efforts to reduce the greenhouse gas emissions that are warming the planet, according to an internal EU document seen by Reuters.
