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 School of Geography and the Environment

28 August 2009

Climate costs could be way off target

"The costs of adaptation for ecosystems are potentially huge, the largest of any sector, and yet very little is known about them", says ECI's Dr Pam Berry (with Professor Martin Parry, former ECI Director and lead author of the climate costs report).

"The costs of adaptation for ecosystems are potentially huge, the largest of any sector, and yet very little is known about them", says ECI's Dr Pam Berry (with Professor Martin Parry, former ECI Director and lead author of the climate costs report).

There has been strong media coverage of a new report raising serious doubts about the world's assessment of the costs of adapting to future climate change. ECI's Dr Pam Berry is one of the report's co-authors. The report suggests the current figure from the United Nations Framework Convention on Climate Change (UNFCC) may be a two-to-three fold underestimate, and potentially many times worse.

The report Assessing the costs of adaptation to climate change: a review of the UNFCCC and other recent estimates was led by Professor Martin Parry, ECI's first Director, co-chair of the Intergovernmental Panel on Climate Change working group on impacts, vulnerability and adaptation between 2002 and 2008, and now at the Grantham Institute.

The report assessed the previous estimate of US$40-170bn undertaken by the UNFCCC and concludes that it did not include key sectors such as energy, manufacturing, retailing, mining, tourism and ecosystems. Other sectors that the UNFCCC did include were only partially covered.

Dr Berry led the research on ecosystems. "The costs of adaptation for ecosystems are potentially huge, the largest of any sector. This is not only because of the projected future losses of species, but also because of the immense value of ecosystems for human health and well-being through the provision of food, fuel and fibre. The worrying feature is that our report has identified how little is known about this, the biggest elephant in the room. Even worse, uncertainty is leading to their omission from the overall figures, which will compound the underestimate"

Professor Parry and his report colleagues have warned that the underestimate of the cost of adaptation threatens to weaken the outcome of UNFCCC negotiations, which are due to culminate in Copenhagen in December with a global deal aimed at tackling climate change.

"The amount of money on the table at Copenhagen is one of the key factors that will determine whether we achieve a climate change agreement," says Professor Parry. "But previous estimates of adaptation costs have substantially misjudged the scale of funds needed. Just looking in depth at the sectors the UNFCCC did study, we estimate adaptation costs to be 2-3 higher, and when you include the sectors the UNFCCC left out the true cost is probably much greater,"

The new report's key findings include:

  • Water: The UNFCCC estimate of US$11 billion excluded costs of adapting to floods and assumes no costs for transferring water within nations from areas of surplus to areas of deficit. The underestimate could be substantial, according to the new report.
  • Health: The UNFCCC estimate of US$5 billion excluded developed nations, and assessed only malaria, diarrhoea and malnutrition. This could cover only 30-50% of the global total disease burden, according to the new report.
  • Infrastructure: The UNFCCC estimate of US$8-130 billion assumed that low levels of investment in infrastructure will continue to characterise development in Africa and other relatively poor parts of the world. But the new report points out that such investment must increase in order to reduce poverty and thus avoid continuing high levels of vulnerability to climate change. It says the costs of adapting this upgraded infrastructure to climate change could be eight times more costly than the higher estimates predicted by the UNFCCC.
  • Coastal zones: The UNFCCC estimate of US$11 billion excluded increased storm intensity and used low IPCC predictions of sea level rise. Considering research on sea level rise published since the 2007 IPCC report, and including storms, the new report suggests costs could be about three times greater than predicted.
  • Ecosystems: The UNFCCC excluded from its estimates the costs of protecting ecosystems and the services they can provide for human society. The new report concludes that that this is an important source of under-estimation, which could cost over US$350 billion, including both protected and non-protected areas.

The report calls for detailed case studies of what adaptation costs will be, and points out that the few that already exist suggest that costs will be considerable.

It adds that the UNFCCC estimates do not include the cost of bearing 'residual damage' that will arise from situations where adaptation is not technically feasible or simply too expensive.

"Finance is the key that will unlock the negotiations in Copenhagen but if governments are working with the wrong numbers, we could end up with a false deal that fails to cover the costs of adaptation to climate change," says Camilla Toulmin, director of the International Institute for Environment and Development, which co-published the report.

Professor Sir Brian Hoskins, Director of the Grantham Institute for Climate Change at Imperial College London, which co-published the report, says: "The costs of adapting to live with a changing climate are very uncertain. However, this new report suggests that previous attempts to figure out the costs have drastically under-estimated how expensive this could be. With such large sums potentially involved, the pressure to act now to reduce the extent of climate change is greater than ever."

The new report was reviewed by seven of the world's foremost adaptation scientists, including lead authors of the original UNFCCC study. Following this, close to 100 adaptation policy and research experts were invited to comment on the pre-publication draft.

The report's authors are: Professor Martin Parry (Imperial College London), Professors Nigel Arnell (University of Reading), Richard Tiffin (University of Reading) and Tim Wheeler (University of Reading), Dr Pam Berry (University of Oxford), Drs David Dodman and David Satterthwaite (International Institute for Environment and Development), Dr Sam Fankhauser (London School of Economics), Dr Chris Hope (University of Cambridge), Dr Sari Kovats (London School of Hygiene and Tropical Medicine), Professor Robert Nicholls (University of Southampton).

The report is available at: http://www.iied.org/pubs/display.php?o=11501IIED

Media coverage includes: