Climate change is no longer controversial: it's fact. Now the burning questions include how to stop the process– and how much it will cost.
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- A great extinction is on the brink, thanks to mankind
For the United States alone, annual property losses from hurricanes and other coastal storms is expected to reach $35 billion a year over the next 25 years. Don't expect that insurance coverage will neutralize that cost, firstly because not everybody at risk is insured, and secondly because as insurers' costs rise, so will premiums.
The decline in crop yields as the environment heats up and extreme weather becomes more frequent: tens of billions of dollars in damage to farmers. And as the cities are stricken by heat waves (or extreme cold, which can happen in a heating world) - households can expect their increase in demand to cost $12 billion more per year over the next 25 years, according to the bipartisan report released on Tuesday.
And that's just for starters. The price tag of contending with the damage of climate change – again, for the U.S. alone - could skyrocket to hundreds of billions of dollars by 2100.
Commissioned by a group chaired by Michael Bloomberg, a businessman and former mayor of New York, with Henry Paulson – a former treasury secretary, and environmentalist and financier Tom Steyer, the report lands three weeks after President Barack Obama ordered U.S. regulators to take their strongest steps ever to reduce greenhouse gas emissions. Among the president's moves are to force power plants to reduce their carbon dioxide emissions to 30 percent below 2005 levels by 2030.
Called "Risky Business," the report's conclusions about crop losses and other consequences are based not on computer projections, which climate-change skeptics routinely attack, but on data from past heat waves.
"Our economy is vulnerable to an overwhelming number of risks from climate change," including from sea-level rise and from heat waves that will cause deaths, reduce labor productivity and strain power grids, said Paulson said in a statement.
By mid-century, $66 billion to $106 billion worth of coastal property will likely be below sea level. There is a 5 percent chance that by 2100 the losses will reach $700 billion, with average annual losses from rising oceans of $42 billion to $108 billion along the Eastern Seaboard and Gulf of Mexico.
The oceans are rising for two reasons. One is melting polar ice. The second is that warmer water occupies a bigger volume than cool water.
Meanwhile, extreme heat, especially in the Southwest, Southeast and upper Midwest, will slash labor productivity as people are unable to work outdoors at construction and other jobs for sustained periods.
Demand for electricity will surge as people need air conditioning just to survive. The strain on capacity will likely require the construction of up to 95 gigawatts of generation capacity over the next 5 to 25 years, or roughly 200 average-size coal or natural gas power plants, says the report.
As utilities add the construction costs to customers' bills, people and businesses will pay $8.5 billion to $30 billion more every year by the middle of the century.
The report does not make policy prescriptions, concluding only that "it is time for all American business leaders and investors to get in the game and rise to the challenge of addressing climate change.