The aggregate cost of adapting to climate change in the US

by Fran Sussman

Not too long ago, I co-authored an article, “Climate change adaptation cost in the US:  What do we know?” which surveyed the state of knowledge on adaptation costs in the U.S.  The article is forthcoming in Climate Policy and a pre-publication version of the article is available on the short papers page.  While the article made strides in expanding our understanding of the literature on adapting to climate change in the U.S., there was one thing it did not do—tell us how much is is going to cost.  This post takes a stab at that.

The article reviewed and reported on the state of knowledge on the costs of adaptation. the peer reviewed literature and  working papers in the “gray” literature that came out prior to 2010.We looked at the results, the methodologies, the climate scenarios used, the time frames, the ways in which adaptation was defined or assumed to occur, and a few other dimensions of the studies.

Our conclusion—not surprisingly—was that we really know very little about what it will cost the US to adapt to climate change.  National-level studies exist only for a few sectors—mostly in infrastructure (including coastal protection, drinking water, waste water treatment, roads, bridges).   Lots of important sectors and impact categories are missing—including power generation and transmission, health care to treat and prepare for increased cases of asthma and water borne or food borne disease, and most types of transportation.

And, importantly, we know virtually nothing about the costs of adapting to increases in extreme events that are attributable to climate change, a linkage that is increasingly being made by scientists (as indicated by this special issue of the Bulletin of the American Meterological Society), but was very tenuous at the time most of the studies were conducted.  Such costs include rebuilding after a storm, for example, and restoring lost services, not to mention strengthening systems so that the damages of future events are less.  And extreme events are not limited to storms—droughts, heat waves, wildfire, extreme precipitation—all these present an aftermath that is costly for society to deal with.

One of the peer reviewers of the article asked that we provide a synthesis of the results to answer the question:  What will it cost the US to adapt to climate change?  Or at a minimum, What will be the costs in a given sector?  Given the few number of studies (often only one or two) for any given sector, the differences in approach taken  within and across sectors, and differences in the climate scenarios used (which also were often out of date)  and assumptions about emissions paths, we felt it would be irresponsible to try to undertake a synthesis across the studies we had reviewed.  Fortunately, the journal editors agreed, and so we never said exactly what adapting to climate change is going to cost the U.S.

But it is still a legitimate question—and one that we can explore, albeit outside the confines of the peer reviewed journal environment.  The discussion brief, “What Will it Cost the US to Adapt to Climate Change” –available in the short papers page on this website–does just that—it pulls out some of the information from the journal article and asks what it tells us about the magnitude of costs.

The punchline:  adapting to changes in “average” climate could cost anywhere from a few to tens of billions of dollars, per sector, based on the dozen or so national studies that exist.  And depending on how climate evolves, and what steps we take to manage and respond, costs in some sectors  could be much higher—over a hundred billion dollars.

Let’s take the annual costs estimated for the most recent, comprehensive studies in each sector, and add them up (gulp)–giving us perhaps a hundred billion  dollars, if we use conservatively low values for each sector.  Then let’s double it to account for all the sectors  and impact categories that aren’t included, and double it again to account for extreme events, and  we’re up over $400 billion annually.

That’s a big number. It’s not rigorous, but it is suggestive.

Once that is done—we need to wonder: is this even the right question to ask?  How much information on the costs of adapting to climate change to we need to make intelligent decisions?  That question will have to wait for another day.

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