The current surge in energy prices has put into sharper focus the potential risks to price stability arising from the transition to carbon zero. The way in which climate-related physical risks may affect price stability has received less attention, not least because impacts are viewed as being more distant, in the latter half of this century. Yet some recent preliminary research, curated by Miles Parker from the European Central Bank, suggests policymakers should also factor physical risks into their policy framework. In particular, the research highlights the need for careful thought surrounding the size and nature of the shock, and what the implications may be for available policy space.