Abby L. Harvey
GHG Monitor
6/27/2014
From a purely economic perspective, the United States cannot afford to turn a blind eye to the issue of climate change, according to a new report published by the Risky Business Project. The report, published early this week, has gotten significant attention, due in part the project’s co-chairs, Michael Bloomberg, former Mayor of New York City, Tom Steyer, billionaire environmentalist and Henry Paulson, Former Secretary of the Treasury under the George W. Bush Administration. The report states that the overwhelming negative economic impacts of climate change should drown out partisan rhetoric of the issue. “If we have a common, serious, non-partisan language describing the risks our nation may face from climate change, we can use it as the springboard for a serious, non-partisan discussion of the potential actions we can take to reduce those risks.” In a New York Times editorial published the day before the report, Paulson compared current attitudes toward climate change to attitudes leading up to the bust of the "credit bubble" in 2008. "We’re making the same mistake today with climate change. We’re staring down a climate bubble that poses enormous risks to both our environment and economy. The warning signs are clear and growing more urgent as the risks go unchecked," Paulson wrote.
The high profile group aimed to provide non-partisan language in the “Risky Business” report by examining and defining the potential economic impacts of climate change in each region of the county in four categories: rising sea levels and greater coastal storm damage, reduced labor productivity due to rising temperatures, strains to the nation’s energy systems and negative health impacts – including increased mortality rates – due to extreme heat.
Raising Sea Levels, Storm Damage to Cost Billions
The report finds that nearly all coastal areas will be at risk for substantial property losses due to rising sea levels and storm damage. This is due in part to the fact that in coastal regions, most large cities tend to be located directly on the coastline and are vulnerable to the negative impacts of sea level rise and storm surges, the report explains. For example, the Northeast would be at a high risk should the nation continue on its current path. “The coasts are critical to the Northeast region’s economy: Its major cities are on the water, as are many of its major industries, from New York’s Wall Street to the fisheries in Portland, Maine. All told, 88% of the population of this region lives in coastal counties, and 68% of the region’s Gross Domestic Product (GDP) is generated in those counties. As a result, much of the region’s residential, commercial, and energy infrastructure is also at or near sea level, making these assets particularly vulnerable to climate impacts,” according to the report. The report predicts that the region could lose an additional $11 billion to $17 billion in average annual property losses due to sea level rise and storm damage.
Rising Temperatures to Decrease Labor Productivity, Impact Agriculture
Should no additional steps be taken to avoid the effects of climate change, the report says, labor productivity in high-risk areas such as construction, mining, utilities and transportation could take a hit due to increasing temperatures. In areas like the Southeast it will be impossible for humans to work outside in extreme temperatures and more days of work will be lost due to these conditions according to the report. The Southeast could see a decrease in labor productivity of up to 3.2 percent in the high-risk areas mentioned.
The rise in temperature will also affect the nation’s agricultural industry as farmers may need to migrate to cooler temperatures or switch crops in the Midwest and the Great Plains. The report notes the resilience of farmers, while also mentioning the potential negative effect of such adaptation in the agricultural industry on communities reliant on farming. “Armed with the right information, Midwest farmers can, and will, mitigate some of these impacts through double and triple-cropping, seed modification, crop switching and other adaptive practices,” the report says. “In many cases, crop production will likely shift from the Midwest to the Upper Great Plains, Northwest, and Canada, helping to keep the U.S. and global food system well supplied. However, this shift could put individual Midwest farmers and farm communities at risk if production moves to cooler climates.”
Increasing Energy Demand Worrisome in South
Climate driven changes in energy consumption, such as increases in demand for air conditioning could leave the south energy constrained and in turn lead to an increase in energy rates according to the report. “Meeting higher peak demand will likely require the construction of up to 95 GW of additional power generation capacity over the next 5 to 25 years, the rough equivalent of 200 average-size coal or natural gas power plants. Constructing these new power-generation facilities will, in turn, raise residential and commercial energy prices,” the report explains. “These circumstances will likely increase annual residential and commercial energy costs nationally by $474 million to $12 billion over the next 5 to 25 years and $8.5 billion to $30 billion by the middle of the century.”
High Temperatures Could Lead to Deadly Outcomes
The human cost of climate change was also addressed in the report, which said an increase in the amount of extreme heat days would take the largest toll on those too poor to afford air conditioning. For example, the Southeast will be “likely to see an additional 15 to 21 deaths per 100,000 people every year in this region over the course of the century due to increases in heat-related mortality,” the report says. “At the current population of the Southeast, that translates into 11,000 to 36,000 additional deaths per year.”
The report does not prescribe a path to battle the issue of climate change but does state that “this is not a problem for another day. The investments we make today—this week, this month, this year—will determine our economic future.”
