The National Climate Assessment released last month found that coastal communities will be increasingly hard hit by climate change. The study noted that sea level rise of one to four feet is likely unless emissions are reduced, and a six foot rise is possible. The problem is especially acute in the Atlantic seaboard, the report emphasized.
The risk to the overall economy from coastal climate impacts is substantial because coastal counties account for almost 50 percent of gross domestic product. Coastal areas are also the fastest growing and most densely populated regions of the country, accounting for 27 percent of national property by value, with more than half of all residential building permits issued since 1980. As a result, the value of insurable properties in coastal counties tops $14 trillion.
A relatively stable sea level over the past several centuries enabled this development, all of which, from the height of quays to the lowest elevation of houses, to the proximity to the coast of power stations and refineries, has been undertaken on the assumption that such stability will be sustained. That assumption is now being proven false. The local effects of sea level rise could put more and more development along the nation’s coastlines at risk.
This is one of the reasons we have joined the Risky Business initiative with Hank Paulson, Michael Bloomberg, Tom Steyer, Robert Rubin, George Shultz and other business leaders, to better assess and protect against the huge economic risks that climate change represents to American business and our economy, especially along our coastlines. A new report that our group released this week, “Risky Business: The Economic Risks of Climate Change in the United States’’ finds that if we continue on our current emissions path, by 2050 between $66 billion and $106 billion worth of existing coastal property will likely be below sea level nationwide, growing to $238 to $507 billion by 2100. Moreover, there is a 1-in-20 chance that by the end of this century more than $701 billion worth of existing coastal property will be below sea level, and that average annual losses from hurricanes and other coastal storms along the Eastern Seaboard and Gulf of Mexico will grow by more than $42 billion due just to sea-level rise alone.
Scientific evidence demonstrates that the rising levels of greenhouse gas emissions are warming the atmosphere and oceans, and that this process influences the global sea level as warming oceans expand and land-based ice (mountain glaciers, ice caps, and polar ice sheets) melts, increasing the total volume of water in the oceans.
Damage from flooding may be the largest near term cost for the regions we call home, the Northeastern and Southeastern United States. More than 50 million people live in the coastal counties in the Northeast, for example. Likely sea-level rise by 2100 would threaten insurable property valued at $220 to 440 billion in these counties.
A dominant driver of coastal impacts comes from major storms, such as hurricanes. Hurricane Sandy was the costliest storm in US history, with more than 70 direct deaths in the Mid-Atlantic and Northeast regions. Damages are estimated at $65 billion. Sandy’s record storm surge, with water levels hitting almost 14 feet above average low tide at the Battery in Lower Manhattan, included a local contribution from sea level rise of nearly one foot over the previous century. While this storm cannot simply be attributed to climate change, the rise in sea surface temperatures certainly contributed to the storm’s size and intensity.
In Florida, storm impacts may be even higher in the future: the likely 2 to 3.6 feet of sea-level rise projected by 2100 under a business as usual greenhouse gas emissions scenario would result in additional losses of $7.4 to 14.2 billion of commercial and residential real estate each year as a result of increased storm surge, an increase of 50-100 percent above 2010 damages. No wonder flood insurance rates have doubled in the last year in Florida, Louisiana and other states, while many properties cannot get insured at any cost.
While the federal National Flood Insurance Program provides flood coverage to homeowners, the private insurance industry has already begun reducing its financial exposures in high risk coastal areas. Insurers have pulled back from the shores of the Gulf Coast, Florida, and Cape Cod. In the decades ahead as levels of coastal risk rise, insurers can be expected to continue this retreat, which does not bode well for coastal communities in the 21st century.
As a Republican and Democrat, we teamed up to make the case that at its core, climate change should not be a political issue. Instead, it is fundamentally about risks to our safety and economy, and how to reduce those risks. We believe that understanding the scope and potential cost of the threat now is foundational to making informed decisions on timely actions that can greatly reduce our risk from climate change, and we are dedicated to working with the business community and all Americans to do so. American industry is the most dynamic, innovative force in human history. Once our businesses know the risks, we are confident they can be the most important part of the solution.