Network for Greening the Financial System flags retraction of Kotz et al. paper affecting Phase V long-term climate scenario physical damages

The Network for Greening the Financial System (NGFS) published a user notice for its Phase V long-term climate scenarios, warning that the academic paper underpinning the Phase V physical risk estimates, Kotz et al. (2024), has been retracted following post-publication critiques and should be taken into account when interpreting and applying Phase V results. The impacted items are the Phase V variables reflecting physical loss estimates derived from Kotz et al. (2024), including all outputs of the “Integrated Physical Damages” scenarios by REMIND-MAgPIE, all “physical” and “combined” outputs from NiGEM, and post-processed or downscaled GDP damage outputs from the “Kotz-Wenz” damage function (GDP change and Net GDP variables). All other Phase V variables and other physical risk estimates shown in the Climate Impact Explorer remain unaffected, and NGFS short-term scenarios and earlier phases of the long-term scenarios are not affected because they do not rely on Kotz et al. The notice also reiterates scenario limitations, including that economic effects could be more severe than captured (for example if tipping points are reached), and reminds users that reliance on NGFS scenarios does not replace firms’ own risk management responsibilities. The Kotz et al. authors plan to resubmit a new version for peer review, and NGFS plans to use an updated methodology for the next long-term scenario release scheduled for end of 2026. NGFS also added a dataset mapping of NGFS integrated assessment model variables to NACE, GIGS and IEA classifications in the NGFS IIASA Scenario Explorer.