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Backup Documents 06/23/2015 Item #10A lcI2 jj n SWFRPC IDA Pao. ` Pwace %A/love SOUTHWEST FLORIDA REGIONAL PLANNING COUNCIL 1926 VICTORIA AVENUE FORT MYERS, FL 33901 PHONE: (239) 338-2550 FAX: (239) 338-2560 Sea Level Rise Mapping The study area for the region is divided into uplands (433 square miles/277,050 acres) and wetlands (915 square miles/585,766 acres) below 10 feet in elevation, which only exist in the four coastal counties (1,348 total square miles/862,816 acres). This area below 10 feet subject to sea level rise impacts is 22.4 percent of the total region's land area. Exiting land use data is used to determine wetlands and uplands. Land elevations,future land use local government comprehensive plans, county critical facilities emergency mitigation plans and assumptions regarding development rights are used to determine sea level rise protection scenarios. A current population of approximately 607,000 people lives in 357,000 dwelling units. Millions of square feet of commercial, office and other uses are within the study area. This area is expected to be essentially built-out in the next 50 years with a population level of people. Assuming no protection measures against sea level rise, upland areas can be expected to experience vegetation changes, higher hurricane storm surges causing greater flood damages to private and public property, salt water intrusion to public and private wells, and higher flood insurance elevation levels, cost and expanding coverage areas. Assuming protection measures are implemented in developed areas wetland impacts are expected to be significant because of two factors. Sedimentation accommodation space for wetland vegetation that cannot keep pace with accelerating sea level rise and lack of wetland migration space due to wetlands being squeezed between the rising sea and the upland protective structures. Essentially most of the regions developed natural shorelines will be replaced with various types of human created barriers to hold back the sea with a resultant decline of estuarine productivity. �ry � , SWFRPC I Emergency Management Page 2 of 2 t/� USI Publications /� Economic Views 1 Climate Ready Estuaries Harbor Happenings 0 A Reports SWFRPC CHNEP Strategic Regional Policy Plan(SRPP) News Latest News Press Releases Job Opportunities Contact Mission: to work together across neighboring communities to consistently protect and improve the unique and relatively unspoiled character of the physical,economic and social worlds we share for the benefit of our future generations. Emergency Evacuation Planning Tools Florida Division of Emergency Management 2010 Evacuation Study Management Evacuation Planning The Florida Division of Emergency Management,Department of Community Affairs Division of a ___ Federal Emer enc --- -- Community Planning and Department of Transportation in-coor�c i`nauoriwlth-the Snuthwes Agency 2010 Evacuation Study Florida Regional Planning Council have developed the StatewideRegional Evacuation Study National Managnagement ent Hurricane Center for the Southwest Florida Region.This report updates the region's evacuation population Hazardous Materials Planning estimates, evacuation clearance times and public shelter demand. The study covers National Oceanic and Charlotte,Collier,Glades,Hendry Lee and Sarasota Counties and their municipalities. Atmos Adminitration LEPC 2010 EVACUATION STUDY Sea Level Rise Mapping Hurricanes Southwest Florida has been identified by the National Weather Serviceas one of the most hurricane-vulnerable areas of the United States.The potential for large-scale loss of life and property during a hurricane is great. The analysis of hurricane probability is based upon historical occurrences in Southwest Florida,as evidenced in data available from the National Climatic Center,in Asheville,North Carolina;the National Hurricane Center,Miami,Florida; and the Fort Myers and Tampa Area Offices of the National Weather Service. READ MORE Local Mitigation The Disaster Mitigation Act of 2000(DMA2K)significantly expanded the mitigation planning requirements imposed on both state and local jurisdictions in order to maintain eligibility for federal mitigation funds.DMA2K requires each state to have in place a Federal Emergency Management Agency(FEMA)approved State Mitigation Plan to remain eligible for the Hazard Mitigation Grant Program(HMGP), Flood Mitigation Assistance Program(FMAP),or other federal mitigation assistance program funds.While Florida currently has an approved Section 409 Hazard Mitigation Plan,the new requirements dictate a much higher level of detail and increased coordination with other state agencies and local governments. READ MORE News Resources Council Program Areas Resources About Us Regional Planning Latest News Who We Are Agendas&Minutes 9 What We Do Members Information Services Press Releases Reports Economic Development Job Opportunities Related Links Resolutions Contact Us Emergency Management Natural Resources Regional Transportation Copyright©SWFRPC.All rights reserved. 6/23/2015 httn!Hwww.swfrpc.org/emergency_mgmt.html SWFRPC I Emergency Management Page 2 of 3 j'�,p Otni IC) Publications Economic Views Climate Ready Estuaries Harbor Happenings OA Reports SWFRPC CHNEP Strategic Regional Policy Plan(SRPP) News Latest News Press Releases Job Opportunities Contact Mission:to work together across neighboring communities to consistently protect and improve the unique and relatively unspoiled character of the physical,economic and social worlds we share for the benefit of our future generations. Emergency 2010 Evacuation Study Tools Management The Florida Division of Emergency Management,Department of Community Affairs Division of Florida Division of Emergency Management Community Planning and Department of Transportation in coordination with the Southwest Evacuation Planning Florida Regional Planning Council hasdevelopedthe Statewide Regional Evacuation Study Federal Emergency 2010 Evacuation Studyfor the Southwest Florida Region.This report. . Management Agency /J�•� updates the region's evacuation population µ?`' O Hazardous Materials Planning estimates, evacuation clearance times and National Hurricane Center 2011 Innovation Award public shelter demand. The study covers National Oceanic and LEPCSoudtsct Florida Rct tonal Planning Atmospheric Administration Charlotte, Collier, Glades, Hendry Lee and Council and the Florida Regional Sea Level Rise Mapping Sarasota Counties and their municipalities. Councils As$ociation GIS Database(zip) Statewide Regional Evacuation Study Program Volume 1:Technical Data Report The Technical Data Report (TDR) is the primary document of the Statewide Regional Evacuation Study Program.The TDR contains the summary analysis of all other supporting research,survey data and modeling. Executive Summary Chapter I:Regional Demographic and Land Use Analysis Chapter II:Regional Hazards Analysis Chapter III:Regional Behavorial Analysis Summary Chapter IV:Regional Vulnerability and Population Analysis Chapter V:Regional Shelter Analysis Chapter VI:Evacuation Transportation Analysis Chapter VII:Appendices: Charlotte Collier Glades Hend Lee Sarasota Glossary Volume 2:Regional Behavioral Analysis Volume 3:Regional Behavioral Survey Report Volume 4:Evacuation Transportation Analysis Volume 5:Evacuation Transportation Supplemental Data Report Volume 6:Emergency Management Evacuation Toolkit The Emergency Management Tool Kit includes locally-selected data pertinent to the county emergency management agency. It is meant to be used as a quick reference guide for operations.The Toolkit is For Official Use Only and is not available on this website for public download. Volume 7:Storm Tide Atlas The Storm Tide Atlas provides the storm tide boundaries based on the new SLOSH Analysis including the boundaries of the Coastal High Hazard Area(CHHA).It is provided in several formats including GIS files,PDF files and printed copy.There is one Book for each county in the region which has a potential for storm tide flooding. Book 1:Charlotte County Storm Tide Atlas Book 2:Collier County Storm Tide Atlas Book 3:Glades County Storm Tide Atlas http://www.swfrpc.org/evac_study.html 6/23/2015 SWFRPC I Emergency Management Page 3 of 3 (2 Wil,c' Book 4:Hendry County Storm Tide Atlas Book 5:Lee County Storm Tide Atlas 1 0 A Book 6:Sarasota County Storm Tide Atlas A ® "i Volume 8:Methodology and Support Documentation Council Program Areas News Resources About Us Latest News Publications Who We Are Agendas&Minutes Regional Planning Information Services Press Releases Reports What We Do Members Related Links Economic Development Job Opportunities Resolutions Contact Us Emergency Management Natural Resources Regional Transportation Copyright©SWFRPC.All rights reserved. 6/23/2015 http://www.swfrpc.org/evac_study.html • SWFRPC I Hazardous Materials Page 2 of 2 alb 4,12.b)LS Publications /0 Economic Views Climate Ready Estuaries Harbor Happenings Reports SWFRPC CHNEP Strategic Regional Policy Plan(SRPPI News Latest News Press Releases Job Opportunities Contact Mission:to work together across neighboring communities to consistently protect and improve the unique and relatively unspoiled character of the physical,economic and social worlds we share for the benefit of our future generations. Emergency Hazardous Materials Tools Management An increasingly sophisticated technology has been expanding the nature of emergencies and Model Facility Contingency P publicas well as Plan the hazards to those that combat them. It is important for general safety, _Evacuation Planning_ _ __ nar�nnal end business liability,lhat_those_businesses with unique needs have developedpublic Availability of 2010 Evacuation Study emergency response programs and have coordinated them with public emergency managers. H aormaHazardous Mterials In recent years,fires in structures with hazardous materials have incapacitated unsuspecting n Hazardous Materials Planning local responders,and have forced the evacuation of thousands of unsuspecting residents. Public Requests The nature of the threat will not diminish in forthcoming years. LEPC Sea Level Rise Wooing Sheltering-in-Place The Southwest Florida Local Emergency Planning Committee welcomes you to Shelter-in- Place.This section was developed to educate the public on steps to take in the event of the need to find immediate shelter.The LEPC staff is available to conduct a"Shelter-in-Place" presentation to civic groups,clubs,school districts,and churches upon request. Sheltering in Place:Presentation READ MORE About Us Council Program Areas News Resources Who We Are Agendas&Minutes Regional Planning Latest News Publications What We Do Members Information Services Press Releases Reports ortunities Related Links Resolutions Economic Development Job Opp Contact Us Emergency Management Natural Resources Regional Transportation Copyright©SWFRPC.All rights reserved. 6/23/2015 http://www.swfrpc.org/haz_mat.html SWFRPC Page 2 of 3 LEPC 00)15 PublicationsiOAEconomnomic Views Climate Ready Estuaries Harbor Happenings Reports SWFRPC CHNEP Strategic Regional Policy Plan(SRPP) News Latest News Press Releases Job Opportunities Contact Mission:to work together across neighboring communities to consistently protect and improve the unique and relatively unspoiled character of the physical,economic and social worlds we share for the benefit of our future generations. Emergency Local Emergency Planning Committee Agendas The Southwest Florida Local Emergency Planning Committee is mandated by law.In 1986, 02/27/14:agenda I minutes Management 05/22/14:agenda I minutes Congress passed Title III of the Superfund Amendments and Reauthorization Act(SARA Title _Evac,ation Planning _ _A11) $ara—Title.11Lis knowiLas the Emergence Planning and Community Right to Know Act (EPCRA). EPCRA was passed to increase public and private efforts to reduce risks 08/28/14:agerifaTminu es _ associated with the use and storage o 2010 Evacuation Study 12/05114:agenda I minutes _la hazardous chemicals. Hazardous Materials Planning Moreover, it establishes a unique public/private partnership of government entities and 02/26/15:agenda I minutes LEPC industry for the planning and reporting of hazardous and toxic chemicals. The Florida 05/28115:agenda I ap cket Sea Level Rise Mapping Hazardous Materials Emergency Response and Community Right to Know Act of 1988, minutes implements the federal legislation and provides a funding mechanism to support activities. The intent of the legislation is two fold: ate To develop plans to respond quickly in the event of an accident, spill or release of State chemicals or hazardous materials. Meetings To increase the public's knowledge and access to information regarding the presence of hazardous chemicals in the community and releases of the chemicals into the /10/15:Summary environment. Trainings Who are Members? The Southwest Florida(District IX) Local Emergency Planning Committee is comprised of 02/12/15:EPCRA Course unpaid volunteers appointed by the Florida State Emergency Response Commission whose members are appointed by the Governor. Tools Request for Proposals 2014 LEPC Plan Hazardous Materials Commodity Flow Study Deadline:July 1,2015,2:00p.m. 2015 LEPC Plan LEPC Facility/Homeland Securit R__Re_sotution LEPC Roster LEPC Member Nomination Form Model Facility Contingency Plan Risk Management Plan Reporting Florida Division of Emergency Management/Florida SERC Southwest Florida LEPC School Toolkit 6/23/2015 http://www.swfrpc.org/lepc.html 4..7,--,r-, \pc„,/z ,1' C.f t. „„, ‘.,., .....,,,,...„,,,,,..,.-,.,o, x RISKY BUSINESS , , „., ,,, , ...., ,s The Economic Risks of Climate Change in the United States „,, x d • t «� � a �f 4l e 3 � v x a 3fal 4,,E” 2 n. 5 YJIiwI 44 Mdtpii ✓ . . "+d " aa% a te -. A",, ,. ,,sev4 Pe44'04ZU 4-, ' -4.141-4 — 0 V, .°1 3.ii'S.P - ."2....-712,8--r- r4:';'21 '''""` /4„, l� m ,:t . ,.. . ......, ,„:„. , ,,,,,,,„ ,, ,.,,,„, ,,. „. ,... a q. •%k i ''A t:,,. ',,t,' --..,„,..4.1"-- — '.... ..,„...; ' . -. i , ,:s ,; ' %.,w.NY', -= ° °'' I. - rikeht,. 4,- 04-4 tail F-4, pl3/4% ,,,% 2,21,7 rip*w trig tl I 07,0,,,,,ve , i. ',,j-'4':::-,,i,?tii,a,—,,-yl,i,'.:4, '''‘'''''.....,\t:':::'.4 fill,4 1 ''''://eV4/10'3,‘ ?",,W F ,/,..'''-'1114 P4' WIll'''''''*"fl'Ilik ?1,441'' iii7:044Pri Ugg,g4ti PT,:' 00,464 l' *.,,.(:''''4 '- s,"";,-*ar—c,,. Ai i ,,, ., , , ,.„ ..: .,,,s, ,,,,,,,,,,,i:44,0‘v, -20:041 - ,gr:41,1i..-1 vet--,-4'ivit#041 ;all:114 : ,,,1 „I.,. ilki wIal il 11 s. - „ .:vim pine 2014 f , , A CLIMATE RISK ASSESSMENT EOR THE UNITED STATES (03115 C 10A RISKY BUSINESS: The Economic Risks of Climate Change in the United States A Product of the Risky Business Project: Co-Chairs: Michael R.Bloomberg,founder,Bloomberg Philanthropies;108th Mayor of the City of New York;founder,Bloomberg L.P. Henry M.Paulson,Jr.,Chairman of the Paulson Institute;former U.S. Secretary of the Treasury Thomas F.Steyer,retired founder,Farallon Capital Management LLC Risk Committee Members: Henry Cisneros,Founder and Chairman,CityView Capital;former U.S.Secretary of Housing and Urban Development(HUD);former Mayor of San Antonio Gregory Page,Executive Chairman,Cargill,Inc.and former Cargill Chief Executive Officer Robert E.Rubin,Co-Chairman,Council on Foreign Relations;former U.S. Secretary of the Treasury George P.Shultz,Thomas W.and Susan B.Ford Distinguished Fellow at the Hoover Institution;former U.S.Secretary of State;former U.S.Secretary of the Treasury;former U.S.Secretary of Labor;former Director,Office of Management and Budget;former President,Bechtel Group Donna E.Shalala,President,University of Miami;former U.S.Secretary of Health and Human Services Olympia Snowe,former U.S.Senator representing Maine Dr.Alfred Sommer,Dean Emeritus,Bloomberg School of Public Health; University Distinguished Service Professor,Johns Hopkins University ©2014 Risky Business � z31c- Ci. ...„,,,,„„,„,410$4414004111 .,,, 3�,�� ,fi �. �:�, i iiink,..ketoit o 1111 rya ,� ��. � . . ,.:. es" t4 Y$ .* 04„11144411111111106%"w4- ,fini r P ,,,e,::. ...:.;.,„0".,,,,,60.0,.,10„, ', saltk 5 '�/l/yi/f ;, °baa , MATE S ..... ... S , 612-3/( 10A- 1OAr ACKNOWLEDGEMENTS Lead At the>'s Kate Gordon, t Kecutive Director of the risk assessment,and scalable cloud computing(pro- Risky Business Project,drawing from independent cessing over 20 terabytes of climate and economic data) research commissioned by the Risky Business Project. to provide decision-makers with empirically-grounded Special thanks to Matt Lewis, Risky Business Project and spatially-explicit information about the climate risks Communications Director,and jamesine Rogers,Risky they face.The team's complete assessment,along with Business Project Manager,for their editorial support. technical appendices,is available at Rhodium's website, Research Risky Business Project co-chairs Michael R. climateprospectus.rhg.com.Interactive maps and other Bloomberg,Henry Paulson,and Tom Steyer tasked content associated with the Risky Business Project are the Rhodium Group,an economic research firm that located at riskybusiness.org. specializes in analyzing disruptive global trends,with an The research team's work was reviewed by an indepen- independent assessment of the economic risks posed dent Risky Business Expert Review Panel composed of by a changing climate in the U.S.Rhodium convened leading climate scientists and economists.A full list of the a research team co-led by Dr. Robert Kopp of Rutgers expert review panel is available on Rhodium's website. University and economist Dr.Solomon Hsiang of the Funding This report would not have been University of California,Berkeley.Rhodium also part- possible without the financial support of Bloomberg nered with Risk Management Solutions(RMS),the world's Philanthropies,the Office of Hank Paulson,the largest catastrophe-modeling company for insurance, Rockefeller Family Fund,the Skoll Global Threats Fund, reinsurance,and investment-management companies and the TomKat Charitable Trust. around the world.The team leveraged recent advances in climate modeling,econometric research, private sector PLEASE NOTE:Several numbers in this report were updated on September 8,2014 to reflect the most current data from the American Climate Prospectus. RISKY BUSINESS The Economic Risks of Climate Change in the United States Vl',{' ,:f«*�:•t ,j 's, • , l;W ,. 'ys.• Y ,,1y� t..•, Qiv4t 7M1ia ,> • '*« SIN �:,> ,, '3. .F � ii�t's' f • 3�fi.^ €�F�. :�.",��<',,..14.,,,,,,,,,,„-„,:,,„,,,„,,,,::‘,„,:4,,,,, ,{ �.:..s f TABLE OF CONTENTS 7 (p • "*:M1 S3,iX�.`„ ' °�i',a+•w T •-••••:-..'".--t.';'::;,":;',,ca .<: rF R.�F,••':r 4:04.,, ,,,,:-• :7= izt d'�w��tor:St' ��'' �`: Z �fv,'P;' «>�r'+� .�, .�'��;, 't z;":':,';_.>.< •y� T i"J'".: r 1",�•', a`l'e �•9 » liff .:f Lam+` �•�. k � ., £,,< ..,',:.: 4-•'si,••"<:;v!'" ', .f:¢0•" ,oF�, `>�• „=d�. �` �1.':r ..�." �� .i"°'.'��"Y”•'•��4'�,41.,i.,,,,4,5' 3s;�2 ::s n�.-';:.',,".)..-,".w _».y::.` z: u ••'�> �..f '�'fri.A,j, �ea`:��.��' Fi. M1i.e ;,,' • ;"sr &12,., i loiii' Ci?--, - i's-i.'"i 'i'''‘Viii'zii:;,,,;',17,'''' ''' ' '7#•1-R14:- ii"'iii,i4pix.,.iiriovi,r,iivi0;voi,,iiii;iii5,7'ii';',iiiiiiiiiiiiiii:;*,,ii•',e4i55:4..,-. '''',"-iiiir>fr,;•-i'i'-''' .'",i- .....iiiiis .i,'', °• 'I.`i,ii,,,,-,--i-i' i ,. 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'f r. 1 ';,lte\Ni=,:wvie,"s.%QA:).kt?..,;,,Vvv.z,,,;.i.A.ak,...:,', y..4 i �~~~ --,.-. .4-44,2.1.,,,,~ �_ ~� _ _� - _ . ~_ �'_~- � .._~�~~~~~~~~~' Damages from5b}rD?s,flooding, and heat waves �� cDs� economies billions ady «f dollars—we �OkK��CY��y��8(//D ��N/ yD�� [�/��h //UY�[�O� ��O�» With the oceans rising and the climate changing, the Risky Business report details the costs nf/na[�0n /Dway� �hQ� Qy� ��Kf00Dd�y3�O��i� d»0«r O�/f [2��--��'f 'impossible - - . ° to ignore. *Risky Business Projnc ' o-Chair Michael R. Bloomberg` ' TheU�S�faoss�n�cantanddke�eeconnmicrisks current path.The Risky Business research focused on the from climate change The signature effects of human-in- clearest and most economically significant of these risks: duced climate change--rising seas,increased damage /Damage to coastal property and infrastructure from from storm surge, more irequent bouts of extreme rising sea levels and increased storm surge,cli- hea+—a||havespecif/c ,nrasurah|eirnpoc�snnnu. mate-driven changes in agricultural production and nabon'scurrent assets andongoing economic achvity, energy demand,and the impact of higher tempera- tumesun|aborproducdxityandpub|ichea|th�/ To date,there has been no comprehensive assessment �� of the economic risks our nation faces from the changing Ourresearchcnmbinespeeprevievveddimaesdence climate.Rbky8us�es:The Economic Risks cfClimate projections through the year 2100 with empirically-de- change to the United States uses a standard risk-assess- rived estimates of the impact of projected changes ' ment approach to determine the range of potential in temperature,precipitation,sea levels,and storm consequences for each region of the U.S........as well as for activity on the U.S.economy.We analyze not only those se|ected�ectorsoftheeconomy—'ifweconbnueonour ouoomesmosc|ike|y�ooccu/'bu�abo|owe�probabi|ity | RISKY BUSINESS Ce/23// /C CP- 1 P1 0 II EXECUTIVE SUMMARY high-cost climate futures.Unlike any other study to date, Climate Change:Nature's Interest-Only Loan we also provide geographic granularity for the impacts we Our research focuses on climate impacts from today out quantify,in some cases providing county-level results. to the year 2100,which may seem far off to many inves- Our findings show that,if we continue on our current path, tors and policymakers.But climate impacts are unusual many regions of the U.S.face the prospect of serious eco- in that future risks are directly tied to present decisions. nomic effects from climate change.However,if we choose Carbon dioxide and other greenhouse gases can stay a different path—if we act aggressively to both adapt to in the atmosphere for hundreds or even thousands the changing climate and to mitigate future impacts by of years.Higher concentrations of these gases create reducing carbon emissions—we can significantly reduce a"greenhouse effect"and lead to higher temperatures, our exposure to the worst economic risks from climate higher sea levels,and shifts in global weather patterns. change,and also demonstrate global leadership on climate. The effects are cumulative:By not acting to lower SHORT-TERM CLIMATE THREATS The American economy is already beginning to feel challenge going forward for certain farmers in #._ the effects of climate change.These impacts will specific counties in the Midwest and South will be likely grow materially over the next 5 to 25 years and significant.Without adaptation,some Midwestern . • affect the future performance of today's business and Southern counties could see a decline in yields and investment decisions in the following areas: of more than 10%over the next 5 to 25 years should they continue to sow corn,wheat,soy and cotton, ..oastai property and infrastructure.Within the with a 1-in-20 chance of yield losses of these crops of next 15 years,higher sea levels combined with storm more than 20%. surge will likely increase the average annual cost of coastal storms along the Eastern Seaboard and the Energy.Greenhouse gas-driven changes in tempera- Gulf of Mexico by$2 billion to$3.5 billion,Adding in ture will likely necessitate the construction of up to potential changes in hurricane activity,the likely 95 gigawatts of new power generation capacity over increase in average annual losses grows to up to$7.3the next 5 to 25 years—the equivalent of roughly 200 billion,bringing the total annual price tag for hurri- average coal or natural gas-fired power plants—cost " canes and other coastal storms to$35 billion. ing residential and commercial ratepayers up to$12 billion per year. Agriculture.A defining characteristic of agricuiture in the U.S.is its'ability t ;t tation k i RISKY BUSINESS The Economic Risks of Climate Change in the United States le/ 0 > IOA EXECUTIVE ¢NI n greenhouse gas emissic ns today,decision-makers put , property losses from sea level rise are concentrated in place processes that increase overall risks tomorrow, in specific regions of the U.S.,especially on the and each year those decision-makers fail to act serves to Southeast and Atlantic coasts,where the rise is higher broaden and deepen those risks.In some ways,climate and the losses far greater than the national average. change is like an interest-only loan we are putting on the • Extreme heat across the nation—especially in the backs of future generations:-They will be stuck paying off Southwest,Southeast,and Upper Midwest--threat- the cumulative interest on the greenhouse gas emissions ening labor productivity,human health,and energy we're putting into the atmosphere now,with no possibili- systems ty of actually paying down that"emissions principal." By the middle of this century,the average American Our key findings underscore the reality that if we stay will likely see 27 to 50 days over 95°F each year—two on our current emissions path,our climate risks will to more than three times the average annual number multiply and accumulate as the decades tick by.These of 95°F days we've seen over the past 30 years.By risks include: the end of this century,this number will likely reach • Large-scale losses of coastal property and 45 to 96 days over 95°F each year on average. infrastructure » As with sea level rise,these national averages mask / If we continue on our current path,by 2050 between regional extremes,especially in the Southwest, $66 billion and$106 billion worth of existing coastal Southeast,and upper Midwest,which will likely see property will likely be below sea level nationwide, several months of 95°F days each year. with$238 billion to$507 billion worth of property » Labor productivity of outdoor workers,such as below sea level by 2100,7 those working in construction,utility maintenance, There is a 1-in-20 chance about the same chance landscaping,and agriculture,could be reduced by as as an American developing colon cancer;twice as much as 3%by the end of the century,particularly in likely as an American developing melanoma`—that the Southeast.For context,labor productivity across by the end of this century,more than$701 billion the entire U.S.labor force declined about 1.5%during worth of existing coastal property will be below the famous"productivity slowdown"in the 1970s.3 mean sea levels,with more than$730 billion of » Over the longer term,during portions of the year, additional property at risk during high tide.By the extreme heat could surpass the threshold at which same measure of probability,average annual losses the human body can no longer maintain a normal from hurricanes and other coastal storms along the core temperature without air conditioning,which we Eastern Seaboard and the Gulf of Mexico will grow measure using a"Humid Heat Stroke Index"(HHSI). by more than$42 billion due to sea level rise alone. During these periods,anyone whose job requires /Potential changes in hurricane activity could raise this them to work outdoors,as well as anyone lacking figure to$108 billion./ 4 RISKY BUSINESS I The Economic Risks of Climate Change in the United States (cm//S !04- C� q 0A EXECUTIVEM2 access to air conditioning,will face severe health risks change into its decision-making process.We are already and potential death. seeing this response from the agricultural and national • Demand for electricity for air conditioning will surge security sectors;we are starting to see it from the bond in those parts of the country facing the most extreme markets and utilities as well.But business still tends to temperature increases,straining regional generation respond only to the extent that these risks intersect with and transmission capacity and driving up costs for core short term financial and planning decisions. consumers. Ye also know that the private sector does not operate • Shifting agricultural patterns and crop yields,with in a vacuum,and that the economy runs most smoothly likely gains for Northern farmers offset by losses in when government sets a consistent policy and a regula- the Midwest and South tory framework within which business has the freedom !» As extreme heat spreads across the middle of the to operate. Right now,cities and businesses are scram- " country by the end of the century,some states in the bling to adapt to a changing climate without sufficient Southeast,lower Great Plains,and Midwest risk up federal government support,resulting in a virtual"un to a 50%to 70%loss in average annual crop yields funded mandate by omission"to deal with climate at the (corn,soy,cotton,and wheat),absent agricultural local level.'We believe that American businesses should adaptation play an active role in helping the public sector determine how best to react to the risks and costs posed by climate • At the same time,warmer temperatures and carbon change,and how to set the rules that move the country fertilization may improve agricultural productivity forward in a new,more sustainable direction. and crop yields in the upper Great Plains and other northern states. With this report,we call on the American business » Food systems are resilient at a national and global community to rise to the challenge and lead the way level,and agricultural producers have proven them- in helping reduce climate risks.We hope the Risky selves extremely able to adapt to changing climate Business Project will facilitate this action by providing conditions.These shifts,however,still carry risks for critical information about how climate change may affect the individual farming communities most vulnerable key sectors and regions of our national economy. to projected climatic changes. This is only a first step,but it's a step toward getting The Risky Business Project is designed to highlight America on a new path leading to a more secure,more climate risks to specific business sectors and regions of certain economic future. the economy,and to provide actionable data at a geo- graphically granular level for decision-makers.It is our hope that it becomes standard practice for the American business and investment community to factor climate RISKY BUSINESS The Economic Risks of Climate Change in the United States 5 CYLi ',,ya, t 5,�t ' '`' r'= , , i i I ki% i,'i'''.$'''''kA, ' ', , •'. ••, ' ,i,,:&,;:i4iihik.'•:',.•• '<•'''`"*„ ,,,i4,,! - j '♦ z " ,,,,••:' �.:nom,',• = ` ;� .',* *,: • c ry .;F� �w, ��3 '\ � Y,.41 ,i • i 4Y' .r. “' ,„-‘,Y:.'• : ::;••,'rt...f.;',1,', ;'..:';', ,ti , . l' • '-, - " 4,,,,i4== =.....=.-A,lk•,-• z.z4, ...,,,,T‘s=“•41,,N=.— '44,t,:: ,,• ''4 < • } '.r.•• < •s,i,',4,4A!‘„z t '` ... ., r;i. . :.: • t' ,i. 'Y= ,> .n?'c ._;� i„: �. '8�a°eee---y fir; ”' •;" • 3 M t a t s•... `< xV ^ ` ":<,- -, .. WAV'v om. .c='• �.. ,, 's. a< ",\\>,F \ .a�.a \ .; `ixf, a' �:, ` C .� , La,x.•, nY' ' tt:x>;;5 • i. • ,sR<; . `��. ... �'� �Iii~ * `., '` a�� .i"wt',�.<...:"'. • v`�;k�E3rK;.;t�F 'ir,.., :.II=' ,�.a • :04, *et :- --,,--,1$1' * 'q010 :„114,,,!„,... ‘.,:.,„ pat, 1„.,„,‘, 4...,,4.,. .,...:•,....4,•.:. , \‘‘z.z ,, :.,... ....„,, ,,,,,,,,, ,,,,,... tk ,i,*'N', .,,. .:tit Ilwe •',',: :54 f , ,, t'''4.. .».,. . t.',4.'„:0- Zf : *)12,3I/ foA- C't/ 0A 4 INTRODUCTION Americans understand risk.Our ability to evaluate risk—to take calculated plunges into new ventures and economic directions and to innovate constantly to bring ;•„ down those risks--has contributed immensely to the , a r nation's preeminence in the global economy.From the j 0-m ta,. •41..! '-• 4k. private sector's pioneering venture-capital financing model to the government's willingness to invest in1 a ; early-stage inventions like the computer chip or the • solar panelkr nation's ability to identify and manageW z� "L potential risks has moved the economy forward in exciting and profitable directions/ The Risky Business Project is designed to apply risk as- . s sessment to the critical issue of climate change,and to Ott gym. take a sober,fact-based look at the potential risks facing specific sectors and regions of the national economy.As Road washed away by extreme flood in Jamestown,Colorado in a classic business risk assessment,we analyzed not only the most likely scenarios,but also the scenarios that, public and private sector response to climate change is while less likely,could have more significant impacts. a year that locks in future climate events that will have a far more devastating effect on our local,regional,and Our conclusion:The American economy faces multi- national economies.Moreover,both government and the pie and significant risks from climate change.Climate private sector are making investment decisions today---- conditions vary dramatically across the U.S.,as does whether in property,long-term infrastructure or regional the mix of economic activity.Those variations will and national supply chains---that will be directly affected benefit our economic resilience to future climatic by climate change in decades to come. changes.But each region of the country has a differ- ent risk profile and a different ability to manage that Our assessment finds that,if we act now,the U.S.can still riskhere is no single top-line number that rep- dvoic most of the worst impacts and significantly reduce resents the cost of climate change to the American the odds of costly climate outcomes—but only if we star economy as a whole:We must take a regional changing our business and public policy practices today. approach to fully understand our climate risk./ The Risky Business Project does not dictate the solutions Given the range and extent of the climate risks the to climate change;while we fully believe the U.S.can American economy faces,it is clear that staying on our respond to these risks through climate preparedness and current path will only increase our exposure.The U.S. mitigation,we do not argue for a specific set or combi- climate is paying the price today for business decisions nation of these policies.Rather,we document the risks made many years ago,especially through increased coast- and leave it to decision-makers in the business and policy al storm damage and more extreme heat in parts of the communities to determine their own tolerance for,and country.Every year that goes by without a comprehensive specific reactions to,those risks. RISKY BUSINESS The Economic Risks of Climate Change in the United States 7 / C)1 A b Ntslikti '-'!„ 2-i, %.„144 � " iii a`e d`#F er 5 ,41k.„:.'':*;.''.';';.,'e'<:,,;1,01k..-<. ';..'te.:...<<ik0"t'''1,44,;,,,, r: i , .... ..„.„,„„:„:„:„:„...,...„„,„.....,„,, ......,..... ...„:„..„ .. ...... ,... ,„,„ :rilitik ,,,::;74„,ii,i..... .-,,,,. ...,....,.,...„.,...,... ,,,..,„...,.,7,.,,,,,,,:,,,,,,,,Hilk„. , ,. . . . '. , . „ . „ ,.::,,Ii!41101 . , „. ,.. . ... . , .„„..,.. ,, ,., .,. . , „ ., , ., , ,. , am*" ilift1-4,.:,, .:%::... :.44,,„,,,t# , :...:411,:,,,..:„ Iitia 4;4101 k'''' '' 4. .gt ,4,4 ililliti4 $x al` a�� lpAgiithiir a0.Dy.; . a a , t --. ..44..41.,,, s ,m „ ...„,,,,,'.!<.,4,. A couple is rescued from their home on Galveston Island,Texas,after a hurricane a Y-,raF P/i-5//4 /oA- • UNDERSTANDING CLIMATE RISK /know a lot about financial risks—in fact, I spent nearly my whole career managing risks and dealing with financial crisis. Today I see another type of crisis looming:A climate crisis, And while not financial in nature, it threatens our economy just the same. —Risky Business Project Co-Chair Henry Paulson x; In order to know how to best respond to climate change, Assessing and managing risk is how businesses,mili- we first need to fully understand the risks it presents. taries and governments are able to remain productive This is our core principle.As Risky Business Project Co- and successful in an increasingly complex,volatile,and Chair Michael Bloomberg observeslf you can't measure unpredictable global economy. it,you can't manage it." DEFINING RISK I he risk of a future event can be described as the futures that would be either considerably better or probability(or likelihood)of that event combined considerably worse than the likely range.This is a with the severity of its consequences.The combina- common risk assessment approach in other areas tion of likelihood and severity determines whether with potentially catastrophic outcomes,including di- a risk is high or low.For instance,a highly likely salter management,public health,defense planning, event with minimal ca quences would register and terrorism prevention. as a moderates is ility'event,if it has potentiallye;� 'could constitute a In presenting our results we use the term "likely" I significantr low . lrtythi h impact to describe outcomes with at least 6T%(or 2-in-3) risks are generally referred`, chance of occurring. In discussing tail risks,we gen- erally describe results as having a 1-in-20 chance(or The Risky Business asse, evhlciates a° of being worse than(or better than)a particular of economic risks presented climate changeltf''''''Oflesholid.Where the science allows it,we also de the U.S.,including both those outcomes considered scribe 1-in-100 outcomes,or those with a 1%chance most likely to occur and lower probability climate of occurring. eef 23//$ 10-k CH1' 0 UNDERSTANDIX CLIMATE RISK The risk approach is well suited to the issue of climate Moreover,all these conditions can and will change based change.Even the single term"climate change"is short- on the actions we take today and into the future,as hand for a diverse array of impacts,mostly stemming well as on unknowable factors such as the precise rate from increased heat in the atmosphere and oceans,but of Arctic and Antarctic ice meltfl-lus the"change"part also radiating outward in myriad and geographically of climate change is the crux of the matter:To plan diverse ways.For example,in some regions sea levels will for climate change,we must plan for volatility and likely rise,while in others they may actually fall.In some disruption./ areas we will likely see increased droughts,whereas in Risk assessment gives businesses a way to plan for others the combination of heat and humidity could lead change.From PricewaterhouseCoopers's 2008 primer,"A to physically unbearable outdoor conditions,with in- Practical Guide to Risk Assessment": creased risk of heat stroke for the many Americans who work outdoors in sectors such as construction,utility The ability to identify,assess,and manage risk maintenance,transportation,and agriculture, is often indicative of an organization's ability to respond and adapt to change. Risk assessment helps organizations to quickly recognize potential adverse events,be more proactive 1000 , and forward-looking,and establish appropriate Business as Usual:Our Current Path risk responses,thereby reducing surprises and 800 "—Small Emissions Reduction the costs or losses associated with business ,m ., Medium Emissions Reduction disruptions.This is where risk assessment's real Large Emissions Reduction value lies:in preventing or minimizing negative 600 —Historical surprises and unearthing new opportunities. 400 The Risky Business Project examines the risks of the U.S. continuing on its current path,or"business as usual."This 200 assumes no new national policy or global action to mitigate In o cv o climate change and an absence of investments aimed at m m CrP Years o 0 0 improving our resilience to future climate impacts.Taking these policy and adaptive actions could significantly reduce Our research examines the risks of the U.S.continuing on its the risks we face,as illustrated in Figure 1. current path,or'business as usual"Alternate pathways that include investments in adaptation or policy efforts to mitigate climate change through lowering carbon emissions could significantly reduce these risks. Original data source:Meinshausen,M.,Smith,S.J.,Calvin,K.,Daniell.S.,Kainuma,M.L.T.,Lamarque,J.-F., _ Vuuren,D.P.P.van,"The RCP greenhouse gas concentrations and their extensions from 1765 to 2300,"Climatic Change 109(1-2)(2011):213-241,available at http://edoc.gfz-potsdam.de/pik/get/5095/0/0ce498a63b 150282a296729de9615698/5095.pdf. 10 RISKY BUSINESS The Economic Risks of Climate Change in the United States • ky230, /04 �--� 10A UNDERSTAND/NS WHAl RISK "Nurmat'weather distribution seer time distribution range sitated by climate change / / Extreme events Likely events Eremite events The new nernet Human society is structured around"normal"weather,with some days hotter than average and some colder.At the distant`tails"are extreme events such as catastrophic weather.climate change shifts the entire distribution curve to the right.Old extremes become the new normal,new extremes emerge,and the process continues until we take action. Source:Risky Business Our research analyzes the risks of"business as usual"to "Defining Risk"sidebar,p.9.)This focus on"tail risks"is not specific critical sectors of the economy and regions of unique to climate change.After all,households and busi- the country.We focus in particular on sectors that are al- nesses pay a premium for insurance to protect themselves ready making large,expensive investments in infrastruc- against those tail risks,such as the possibility of flood or ture that will likely last well into the future:agriculture, fire,that they deem unacceptable.The military plans for energy,and coastal infrastructure.We also look at the a wide range of possible(and sometimes highly unlikely) impact of climate change on America's labor productivi- conflict scenarios,and public health officials prepare for ty and public health,which influence multiple economic pandemics of low or unknown probability. sectors.These latter impacts also are deeply connected to our shared future quality of life. When looking at climate change,its particularly import- ant to consider the outlier events and not just the most As with any risk assessment,our investigation looks at not likely scenarios.Indeed,the"outlier"1-in-100 year event only the most likely outcomes,but also climate futures today will become the 1-in-10 year event as the Earth that have a lower probability of occurring but particularly continues to warm.Put another way,6;ver time the severe consequences should they come to pass.(See extremes will become the"new normal." RISKY BUSINESS The Economic Risks of Climate Change in the United States 11 /e,;..z..315 IRA- G,-' xr,,'•F'.Y""✓• ew-rr.J�,. „ %," #'q�2.-., .:n • '' o . .i""7.--:,.' w »,.. ♦n«.rp✓»"'" 3":" „'ffi�3a X"`.11 ,i'r��:�.:;="5£.r 1;0N' «��''a"`°� .13f. . "'C=�,f,•r .#✓ � ,,t,*tY. a_�"}�,`�,.,`, cip '"s':f": -,-,,..,--t'„,,-7,.s.., •3 '"s'^=�'.•:.s:' d T 4?�",�<"�"n;.' ''L')! <.}r '�t• ,''.'.A. . >).. 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A ,, REGI s�t SEC- ) . ; • Talking about climate change in terms of U.S. averages is like saying, 'My head is in the refrigerator, and my feet are in the oven, so overall I'm average.' —Risky Business Project Co-Chair Tom Steyer Our risk assessment begins with the straightforward These are only the most likely scenarios;there are possible fact that human-induced climate change leads to rising lower and higher estimates outside the most likely range. temperatures. Within that range,there are also disparities,of course:As the maps that follow demonstrate,some regions of the If we continue along our current path,with no significant country will be far harder hit by extreme heat than others, efforts to curb climate change,the U.S.will likely see lig- and some will experience rising temperatures in terms of nificantly more days above 95°F each year.By the middle warmer winters rather than unbearable summers. of this century,the average American will likely see 27 to 50 days over 95°F each year--from double to more than What matters isn't just the heat,it's the humidity—or,in triple the average number of 95°F days we've seen over this case,a dangerous combination of the two.One of the past 30 to 40 years.Climate change impacts only the most striking findings in our analysis is that increas- accelerate with time,so that by the end of this century ing heat and humidity in some parts of the country could we will likely see 45 to 96 days per year over 95°F.That's lead to outside conditions that are literally unbearable to between one and a half and three months of the year at humans,who must maintain a skin temperature below what are now considered record hot temperatures.To 95°F in order to effectively cool down and avoid fatal heat a put this in context,by the end of the century,Oregon, stroke.The U.S.has never yet seen a day exceeding this Washington,and Idaho could well have more days above threshold on what we call the"Humid Heat Stroke Index," 95°F each year than there are currently in Texas. but.if we continue on our current climate path,this will / change,with residents in the continental U.S.experienc- ing 1 such day a year on average by century's end and nearly 17 such days per year by the end of next century. RISKY BUSINESS The Economic Risks of Climate Change in the United states 13 175115 / iii- CP 1 0 A RESULTS: RISKS VARY BY REGION & SECTOR R ,,ge Days Over 95°F. .o. ;�� r M 3�' 4-. a,, '��ii"�S. avu9 i>/2zt/J a.c a f''' ''''.''''''; 'i, ' ' '1, , .._., Ai7.414V,,fe' -,'*. - '41,4-,1\ T 11j)k, Birth g q College t 1981-2010 2020-2039 Heat Map Key: ■ M • 11111111111 • Average Days Per Yeaat Over 95'F 0 10 20 35 50 75 100 125 150 175 200 250 On our current path,the U.S.will likely see significantly in terms of warmer winters rather than unbearable more days above 95°F each year.Some regions of the summers.But by the end of this century,the average country will be hit far harder by extreme heat than American will likely see 45 to 96 days per year over 95°F. others,and some will experience rising temperatures Data Source:Rhodium Group 14 RISKY BUSINESS The Economic Risks of Climate Change in the United States P/Ofts it/t--- eic? RESULTS: RISKS VARY BY REGION & SECTOR 10 A T- . ' , , ,, .,..r.:.',,,,, .., :, ,,,P'''':::411,,:. -4 • 1' -,,,,.,j.„. • - .• ',,.,_ '..4::At's,',1,-$:',., ,fai:7-.-,-,....,:i,p,,,._1:- . t# ... ‘.- \''''''''* i.;- * ----4;-.7, '1,, ,,_(„__,°-- ,,,- ',kg ''' ' -4f:' :t''''' -.!...V.k...., ,-'r'*0•'- e. '''' • i..k * r ' 1%:' ' 1111)4 * ' * * 0 0 • 210 i"4frOha1d2 0 5 9 Tr RE 1 2080299 By the end of the century, Oregon, Washington, and Idaho could well have more days above 95°F each year than there are currently in Texas; babies being born right now in the Southwest could see nearly four additional months of days over 95°F within their lifetimes. RISKY BUSINESS 1 The Economic Risks of Climate Change in the United States 15 E.,••:, ';,� , r ...' r, 'bf'sn't';%' �_ .5f i y '� r • •i•� ':^"�'� ,.',/,',44,,,.:'.":;,,,,,c:: :, '„�,"`:� r<on„J,:"`,t.��:'"1,,.,:. �r'�.�i,�;�';�..„s•"�>'?`�°,x.,«:x�F�.+ �`"Fir"€i�=`"-� .� �!� :i r. „...:'114:,;',.:1:;„•.:•:„: = 'y. ,s <v� ,;us is t. „,vw.�.: (-,/,Its frok vt, ,,,,,:,4 A {�r.. p p I a RE S U LT : RISKS VARY # ! • Heat is a critical issue for the health of businesses as well /Rising seas and greater coastal storm damage as that of human beings.On their own,rising tempera- already threaten the financial value and viability tures can have significant negative impacts on health and of many properties and infrastructure along also labor productivity.But high temperatures are also at the Eastern Seaboard and Gulf Coast.If we stay on our the root of several other important climate impacts that current climate path,some homes and commercial prop- have long been recognized by scientists: erties with 30-year mortgages in places in Virginia,North dotter air on the Earth's surface leads to higher ocean Carolina,New Jersey,Alabama,Florida,and Louisiana temperatures,which causes ocean expansion and sea and elsewhere could quite literally be underwater before level rise; the note is paid off • Higher temperatures accelerate the rates at which landRising temperatures will also reduce labor ice melts,further elevating average sea levels; productivity,as some regions---especially the • A warmer atmosphere makes extreme precipitation Southeast and Southwest—become too hot by more likely,which is expected to make wet regions even mid century for people to work outside during parts of wetter,but could also make dry regions even drier.i the day. Because the U.S.is such a large and geographically eat will also put strains on our energy system, diverse country,it will experience every one of these 4 simultaneously decreasing system efficiency climate impacts in the next century. Even the individual and performance as system operators struggle sectors we studied have regional variations:For agricul to cool down facilities,and increasing electricity con- ture,for instance,the national story is one of an industry surnptldn and costs due to a surge in demand for air able to adapt by changing where and what farmers plant; conditioning at the same time,the story within particular regions is As parts of the nation heat up,the worst health quite different,as individual farmers potentially aban- • impacts will be felt amongthe poor—many don traditional crops or move away from the farmingi s of whom work or even live outdoors or can't business altogether.For the energy industry,the story afford air conditioning at home—and among those too in the warming North is starkly different than in the elderly or frail to physically withstand the heat or get increasingly unbearably hot South!S`ea levels,too,vary themselves to air-conditioned facilities. significantly across the U.S.,and even across cities along the same coastline:For example,sea level rise at New More than any other factor,our direct economic expo- York will likely be higher than at Boston,and sea level rise sure to climate change will be determined by where we at San Diego will likely be higher than at San Francisco. do business.For that reason,we present our findings below in terms of the major regions of the U.S.,and then As in a standard business risk assessment,we look d at identify how climate change will affect critical sectors • the data to see exactly where the greatest risks lie,and within those regions.Still,as any business person knows, confirmed that some regions and economic sectors face these impacts won't be contained within regional bound- extreme and unacceptable risks.These are some of our aries;the ripple effects are likely to resonate throughout • gravest concerns: the economy.Put another way,just because it's not hot where you are doesn't mean you won't feel the heat of climate change. 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"'...' ......:,.............:.:„....... .. , ... ... . .. ....„:„.„..... .. ...„....„...,..„.„5,......:.....:... .. t , ,>f s " . k F ,� 44 : .. ,•, e . : Y - ,zF"7 SPH • -... .��y�q «fk .x � •C.sw„" mwbg/ y*� `� • v z1F7 - a s/ 4 i,. , *42> Man wades through floodwaters in Immokalee,Florida,afterHurricane Wilma tt/ 3/L5 10A- et-) , .,,,,. .„., ,.., ,„, ,„ -.„,,,,..., I A �, S a 7 K''', 6 ':7'• %,) ** AO' i „0/ ''',:ifV, ' k,i1 , .... , ,,, .2. ' -,,,,,,', ., - i A ``k$,- --......,:l ' ---1,41 - ... ,p,. .... ,,, ,,, , „...„,,,,,,,,,,,,,,,,,„,,„: , , ,,,,,,,, .... , , , ,ry 7,;!ii ,, 44.‘051.K1 -- ''' -.,,,,r,s,-,*-01,,x,:-.:,..1,0*,..,,, va77-r,/1A14-'-''''';\ 4,1,, ,„,,,‘, Ili,,,___ _ I ail ,,,,,,, ::: A , ,''''"r 4;n4- , 1 . „14':----„.., --- •'.. - ' pS A, ;:i Baa ftp, ka ,,,,—,4_,,,,,y4,,,.....:20,6„....„,,,,,.,, .sx+`�."�4�fa�scsir"Rtd� The Risky Business analysis builds on the research However,we went even deeper than the NCA,conducting and analytical work done over the past several decades analysis down to the county level in some cases,and also by international climate scientists and economists, focusing on key economic sectors.We overlaid our re- including the recent National Climate Assessment.(NC:A), gional climate impact findings with an economic analysis released in early May 2014.The Risky Business Project showing the potential cost of these impacts within those takes as our unit of measurement the National Climate regions and sectors. clow,we explore the most striking Assessment regions,which are organized loosely around findings from eac region.We encourage readers to go shared geologic characteristics and climate impacts.90 to riskybusiness.org to explore these regional impacts in These are:Northeast,Southeast,Midwest,Southwest, more depth and to climateprospectus.rhg.com for the Great Plains,Northwest,Alaska,and Hawaii. independent research team's complete risk assessment. ' WHY REGIONS MATTER In a country as large and diverse as the U.S.,it does a peculiar economy;each commands a certain emo- not make sense to aggregate,the highly localized eco- tional allegiance from its citizens.These nations look nomic impacts of climate °-.- into one headline different,feel different,and sound different from each number tkehe case of Huf t other,and few of their boundaries match the political ;�,° , ° last quart 'f 2005,every state in the natio lines drawn on current maps."' Garreau's obser pered except state of Louisiana,which lt> tions underscore the fact that as mobile as many of Gross State Product(GSP)as businesses weericans are,we're still often unwilling or unable tered and workers stayed home;"meanwhile Lt nave out of aur home regions simply because of d following year,storm recovery activities in ' t �?:1 N' ether or economic changes. (e.g.,construction)actually increased the national A Gross Domestic Product(GDP)by half a percent.,2 The regional nature of tt' pacts and the re- Indeed,most economics , s tars in gional nature of the ov �� can economy and '; cultural identity mean the_� [rnay not be one the U.S.happen at thei , n,state, '�� and occasionally mutt single _ �;respon > highlighted by the Risky Business Project.But the reality of these impacts, Regions also have a cultural dimension:Americans` especially in the Southwest and Southeast-which will often think of themselves as"belonging"to specific likely experience the most extreme heat and sea level regions,according to Joel Garreau's famous 1981 rise over this century--may also mean that Americans book The Nine Notions of North America.Garreau pos- have no choicebut to migrate to cooler and more its that Americans live in nine completely different livable areas,disrupting lives,livelihoods,and regional cultural and economic zones.He writes:"Each has identities formed over generations. :' lok NORTHEAST 1- 0 A r% While the Northeast region of the U.S. is expected to experience a sizeable increase in temperatures and average number of extremely hot days over the course of the �.l .�. century,the region's major climate impact ; will be sea level rise and its effect ens coastal infrastructure. Rising sea levels are a direct consequence of rising temperatures:As the oceans warm,they expand.This phenomenon is further exacerbated by land-ice melt, Homeowners look over damage from New York City storm particularly the Antarctic and Greenland ice sheets. Scientists have recently found evidence of accelerat- ing and perhaps unstoppable land ice melt in West Product(GDP)is generated in those counties.As a result, Antarctica.''A further(and more minor)contributor much of the region's residential,commercial,and energy to sea level rise is groundwater withdrawal,which can infrastructure is also at or near sea level,making these literally sink the land adjacent to the ocean.All of these assets particularly vulnerable to climate impacts. factors—thermal expansion,ice melt,and groundwater withdrawal.... can lead to higher water levels along the The Risky Business analysis shows that if we continue on our current path,sea levels at New York City will likely coasts. rise by an additional 0.9 feet to 1.6 feet by mid-century, Why do sea levels matter to the American economy?First and between 2.1 feet and 4.2 feet by the end of the and foremost,sea level rise threatens the communities century.Because our risk assessment includes less likely and industries along our coastlines.The coasts are critical but higher-impact possibilities,we also found a 1-in-100 to the Northeast region's economy:Its major cities are chance that New York City could experience more than on the water,as are many of its major industries,from 6.9 feet of sea level rise by the end of the century.The New York's Wall Street to the fisheries in Portland,Maine. story for New jersey is even more concerning because of All told,88%of the population of this region lives in that state's groundwater withdrawal:It's likely that,on our coastal counties,and 68%of the region's Gross Domestic current path,Atlantic City will see 2.4 feet to 4.5 feet of sea 20 RISKY BUSINESS The Economic Risks of Climate Change in the United States 23i •A- Gly f: . � y t 2 NORTHEAST. All' Std R TEMPERATURE BY 2100 &KEY IM�A ,,, ~,, Sea Level Rise:Sea level rise threatens the , Northeast's major cities,many of which ore on the water,as are many of its major. industries.88%of the population of this region lives in coastal counties,and 68%of the region's Gross Domes- "' f F tic Product is generated in those counties. i tr l,r.X i. ry , •t• d � " r a.i. i Storm Surge:Higher sea levels can expand , ";' the reach of storm-related flooding and make a, storms more damaging.On our current path, z ? . additional projected sea level rise will likely increase average 5 ,{ annual property losses from hurricanes and other coastal storms for the region by$6 billion to$11 billion by 2100. t ','40Y Heat:/nc re'ased heat carr be c l orally severe rn cities and , l met o regio ns with more than;mrriran people,where the high concentration of concrete and lack of natural cooling Average Summer Temperature(°F) systems like streams and forests create an"urban eat island"effect that ';.,:',i!;•111111111111 can raise average temperatures by as much as 5.4°F during the day and 50 70 74 77 80 83 86 89 92 95 100 110 22°F in the evening over the surrounding rural areas. Data Source:Rhodium Group RISKY BUSINESS The Economic Risks of Climate Change in the United States 21 28 s ASA- c J 1 :. 4.1. u level rise by end of this century.North of New York City,the will likely increase average annual property losses from rise is slightly smaller:Boston will likely experience 2 feet to hurricanes and other coastal storms by$6 billion to$11 4 feet by 2100,and Portland is likely to experience a rise of billion over the course of the century.Potential changes in 1.7 feet to 3.8 feet in the same period. hurricane activity,also caused by atmospheric warming, would raise these estimates to$11 billion to$22 billion-- just looking at the simple rise in sea levels masks the im- a 2-to-4-fold increase from current levels. pact these higher levels can have during a major storm.Sea level rise that had already occurred over the past century The Northeast will also suffer from increased heat, exacerbated storm surge during Hurricane Sandy,expand- especially because so many of the region's residents ing the reach of the storm-related flooding and making the live in cities that have higher temperatures due to the storm more costly.Our research shows that,if we continue so-called"heat island effect."In cities and metro regions on our current path,additional projected sea level rise with more than 1 million people,the high concentration of concrete and lack of natural cooling systems like streams and forests can raise average temperatures by . - . as much as 5.4°F during the day and 22°F in the evening New York City over the surrounding rural areas.is x tia, "s t)1 w 4 atAti e fu t ;',,,,A.1.!- lirty. �Li�. LAK: ! '' 31� 5L•.X !9� �, �� G�,e �gl�ga ¢y 16','.4 , �• lr k 7'rti1,..;.4v1,,, . , i .',f i4,Al4N♦ ma . ildf� ,- � y " rQ 01 ® ms ./w�.; e'':t-,,,ST ,; 1p 4 fi® * 'tr flo , ,14 alCurrent expected flooding from 1-in-t00 year storm Increase by 2030 M Increase by 2050 ® Increase by 2100 Source:Risk Management Soultions(RMS) 22 RISKY BUSINESS i The Economic Risks of Climate Change in the United States •� 4 44 • -'. 9:-,,L.L.f., 10 ' i I 111 / 0 A . Right now,the Northeast is actually rather temperate in MI W' y" the summer,with only 2.6 days over 95°F on average each year-•—a temperature we refer to throughout our research 1 as"extremely hot:'By mid-century,the average resident in the Northeast will likely see between 4.7 and 16 additional _ a' extremely hot days;by late century this range will likely z - f%,r jump to between 15 and 57 additional extremely hot days,or up to two additional months of extreme heat.As F - •�: may, we discuss further in the Southeast section below,these increasingly hot summers will have serious negative effects = � on health,mortality,and labor productivity. t. A man tries to cool down during a Philadelphia heat wave RISKY BUSINESS The Economic Risks of Climate Change in the United States 23 EA - - • a 0 dl 4 Like the Northeast, the Southeastern U.S. has many coastal communities,though in this region only 36% of residents live in coastal counties,with 33% of GDP coming 77. from those counties, However,sea level rise could seriously threaten the Southeast's coastal infrastructure,given that some of the regions major cities(e.g.,New Orleans)are at or below sea level while others(e.g.,Miami)are built on porous limestone that allows water inundation even in the presence of a sea wall.Much of the region's critical infra- structure—including roads,rails,ports,airports,and oil and gas facilities---also sits at low elevations. A resident kayaks down a flooded street of No,folk,Va. Our research shows a significant risk to this region from of the century.There is a 1-in-20 chance that more than sea level rise.On our current path,by mid-century, $346 billion in current Florida property will be underwa- mean sea level at Norfolk,Virginia---home to the nation's ter by the end of this century,and a 1-in-100 chance that largest naval base—will likely rise between 1.1 feet and more than$682 billion in property will be below mean 1.7 feet,and will rise 2.5 feet to 4,4 feet by the end of sea levels.An additional$243 billion in property will likely century.However,there is a 1-in-100 chance that Norfolk be at risk during high tide that is not at risk today. could see sea level rise of more than 7.2 feet by the end of the century(Figure 7). As in the Northeast,greater flooding during hurricanes and other coastal storms,plus potential changes in hur- In Florida,because of the porous limestone on which the ricane activity,pose even greater and more immediate major southern cities are built,even modest sea level rise economic risks than mean sea level rise. comes at a significant economic cost.Under current pro- jections,between$15 billion and$23 billion of existing The Southeast will also likely be hit hardest by heat property will likely be underwater by 2050,a number that impacts.Over the past 30 years,the average resident of grows to between$53 billion and$208 billion by the end this region has experienced about 9 days per year at 95°F 24 RISKY BUSINESS The Economic Risks of Climate Change in the United States „ ,,,,,, , ,,, ,, .....,,,,,...1,.1flef,7:71,' :::', 1''''''2';'1it . ” �a- a,� , r - ., ,.!, ,:. ,, ,,,,,„.....: 'Ig`1,4 .,.,, . „or:,. .,,, Mgr y rE � . ",e "Vi t'"' :.;•:"W..'»:`;'r s 9 x``' Y'"k °wr, t„ �f ,xJ",�a� .3 !- til '�,t. e �" ms�ss,, � ,� 1OA SO UTHEAST: AVERAGE SUS lao.��e �� ar%,<M � � sw t''' . .. sit r'., j Heat-Related Mortality:Heat-related mortality wil likely cause 14 to 4.5 additional deaths per 100,000 people each year in this region over the course of the century,with urban residents atgreaEer risk due to the heat island effect"fit current population levels that translates into Na' 0 11,000 to 35,000 addltianal deaths per year ... � Jar�r� .—»...wn..., n Z��!4 - �.� `. •r 3 t 3 } h t { � ,. x ', Storm Surge:increased "� 41114551109: • �' flaodingduringhurri- "as canes and outer coastal ,141111N.1,44:::.. storms paces Pver, rooter and mar e 6 g rimediate ecar;omic risk thou mean _- sea level rise to cities like Norfolk, which could see sea levet rise of more than 7,2 feet by the end of the century. s' Labor ProductivityOn our current emissions path,the average Southeast resident will likely experrence one and a Sea Level Rise:Sea level half to four additional months of extreme heat each year by ice could seriously threat- 2100.Our research shows that extreme hoot will likely lead to a decrease en Southeast coastal in labor!)roductivity in high-risk sectors like construction,mining;utilities, ntfrustrucrwe given that some of the transportation,agriculture,and manufacturing. ion's major cities are at or below sea Average Summer Temperature(°F) levet,while others are built on porous ...® ■■■III limestone that allows water inundation 50 70 74 77 80 83 86 89 92 45 100 110 even in the presence of a sea wall. Data Source:Rhodium Group RISKY BUSINESS The Economic Risks at Climate Change in the United States 25 tett-3ii.. ,-,,-!- .,`....,;,;.;.‘Zr4,',4'''-'7:;: `" ,. - 'a u. d iR .',j ,,, :::-,, -,-,1,4,-, 1,-., t-R,,,,...,-.. ',,,,..,,',-,,.:i.,-, k . . , „ i , +r ,, yl� :,; ' ,k,,,,,„. / a ° V w s xa� � " ` ,ma . r �� ”' `i1.74P.; Y F ;h. y cAw "5 • % : • ,S °j f y .....„..„.. ...,,,,,..„..„,,,,,,..„.. ..„.„ , ; 11.i, '. -.1cje E a�'� 4ripo.,4 i • ti lig, , �, * I d„,,,„,.,„,,,,,,.... ...,.7.7.,;,-,,,1-2.,A.,,,,4; 4.' ''.., t.\ °,:'4 `,” i • , � , r�. '.,esti , .• 4 „�,, a" Source:RMS ''''''''7.:77-:::".. O ChYO° r ' ::::;:. four additional months of extreme heat each year. '—, �i 'i his kind of weather could have serious economic ti wr * impacts:Our research shows a decrease in labor pro- '+ D s ! ductivity in high-risk sectors Ake construction,mining, " Median utilities,transportation,agriculture and manufacturing of \ e up to 3.1%by the end of the centuryin this region,and a .+ 4. l'. smaller but still noticeable impact on labor productivity in :K, 1 air }te low-risk sectors like retail trade and professional services. ' \ 7r;i1;;;Pt1 1 o We are also likely to see an additional 1 to 45 deaths per J 100,000 people every year in this region over the course of or above.Looking forward,if we continue on our current the century due to increases in heat-related mortality, emissions path,the ave.-age r}ge Southeast resident will likely with urban residents at greater risk due to the heat island experience an additions 17 to 53 extremely hot days per effect.At the current population of the Southeast,that year bymid-century nturt and an additional 47 to 1 l 5 days t r translates into 11,000 to 35,000 additional deaths per year. m < ,� year by the end of the century.That's one and a half to 26 RISKY BUSINESS The Economic Risks of Climate Change in the United States • Y . h l ).c.-' (� r' f �,, r tix o�r ci hd,,„ y :fir` '�' $^,�b�' '-+gam : .; *-2 . "'';',146!,4,Allillit,' —2.',„. : ,. ',..,, , ' .- ''.aR:,o A3" y. �.. � , il ;#7,,P140"' itiii,:1,-; �.,,a, Ot;°.4,°;`, ,a� g,°. y' 9�rA "° ``8:zro dad ii.:,,,,,,,;:,°,--R-4. ,,,- d +XS' � ? ' 10A .....„.,*,,,...„.,,,,,,,,,,e.„,,,,,,,,:„tr.iiz„.,.„/„.<?.s,,,,,„: .. .a,.,ei,,..wb'N•*"", -r «._ ate... . ,: ..,, Current Property Value Below Mean Sea level by 2050,Oil/to/11151) Current Property Value F;elow Mean Sea i.evel by 2100,billion USD $700 $700 $682 Median Median $600 $600 1-in-100 $300 $300 1-in-100 20:7 $200 $200 $143 $123 $100 $100 $53 'b $33 $15sem $6 $10 i s ;t'1 $12 1 ' $15$ $20 so I ..... �� SO FL LA MA MD NY FL LA MA MD NY Data Source:Rhodium Group As Risk Committee member Dr.Alfred Sommer has If these[impacts]occur in rural areas you're particularly pointed out,extreme heat will have a rnajor impact on in trouble"'6 He goes onto note that in Chicago during the capacity of local hospitals:'We just don't have the the 1995 heat wave,local officials"didn't even have a surge capacity left in the medical system anymore.... place to properly store[bodies from]the 700 deaths... that occurred over a small number of days."'' G7 RISKY BUSINESS The Economic Risks of Climate Change in the United States 23c 10A- G' x a. P ,,:-„, ., , ,,,,:: ,„.. <,. ...„..:„.„.„,,,,..„,,,,,,,;;,,,„.::;;;;;;,,,..,,,,.;:„„, , ,,,,,,,,,,,„7„,,,,,,,,,r,----,-..,..,:..,.„.,., ,. .„,„„,„.,,..,„,,,„.„,„:.:,,,,,,,,-...--„, ,.„ ,%a p', ..: ,,,...,;,,i:,N '''' q', ''' '' . , tita . „ ,,,,,,,,... :,,,, .„,,,,,„„„„,.,,,,,,,,,:..„- „„‘ s,„,„,,,,„„, ...,. t, it s at sitId11iI.a .,..,,,,„„)„ The upper Midwest economy is dominated by commodity agriculture, with some of the most intensive coal, soybean, and wheat growing in the world. Overall,the agricultural industry in this region includes more than 5 .0.000 farrr<<: valued at$135.6 billion per year as of 2012,and the region accounts for 65%of national production of corn and soybeans alone For �,, • ,V w the Midwest,commodity agriculture is a crucial bush Hess,arid the health and productivity of the agricultural '` �, �„,r' sector is inextricably intertwined with climate condi ` tions.Our research shows that under the"business as A farmersurveys his dry pond bed in Ashley,Illinois usual"scenario and assuming no significant adaptation by farmers,some states in the region,like Missouri and and other adaptive practices.In many cases,crop Illinois,face up to a 15%likely average yield loss in the production will likely shift from the Midwest to the Upper next 5 to 25 years,and up to a 73%likely average yield Great Plains,Northwest,and Canada,helping to keep the loss by the end of the century.Assuming no adaptation, U.S.and global food system well supplied.However,this the region as a whole faces likely yield declines of up to shift could put individual Midwest farmers and farm corn- 19%by mid-century and 63%by the end of the century. munities at risk if production moves to cooler climates. Yet while the agricultural industry will clearly be affected The projected increase in Midwest surface air tempera- by climate change,it is also probably the best equipped tures won't just affect the health of the region's crops; to manage these risks.Farmers have always adapted to it will also put the region's residents at risk.Over the changing weather and climate conditions,with adap- 40 years,the Midwest experienced only 2.7 days tation and flexibility built into their business models. on average over 95°F.If we stay on our current climate Armed with the right information,Midwest farmers cavi, path,the average Midwest resident will likely experl- and will,mitigate some of these impacts through double- ence an additional 7 to 26 days above 95°F each year and triple cropping,seed modification,crop switching by mid-century.and 20 to 75 additional extreme-heat 28 RISKY BUSINESS 1 The Economic Risks of Climate Change in the United States I 2/3 f; t)A (7'/y', 't t� : ' � a ' 3 •a- 3 IDA .. MIDWEST:AVERAGE SUMMER TEMPERATURE BY 2100 & KEY IMPACTS h. s „'A, A s ` 4144' ''''' > Q s' 11ii1t T1�,,,'a. Tri r f , x Mortality:On our current path, ..,./\ , by the end of the k .,„,...,,,,,,,, , ,-,,-.),,,,,, ---/-'"cx,,,,,,,, '' -, , - ,,,013, century,the average Midwest- ! 7 ernes can expect to experience 2 • 3; , days in atypical year when the ,3 heat and humidity are so high r : that it will be unsafe to remain outdoors. x, Agriculture:Midwestern agricultural ,. '1:'2'.'1'......!'i;I:';ii''';'4.' ' n,,,r, production is adopted to current climate conditions.Extreme heat will test the Average Summer Temperature(°F) rrr,its cf crop innovations,anti may result to reduced ■® MARIU■® rop yields...tulle t:s farmers emo,oy new adoptive 50 70 74 77 80 83 86 89 92 95 100 110 practices. Data Source:Rhodium Group 9A RISKY BUSINESS 'I The Economic Risks of Climate Change in the United States 1&4- Cr - , 4 1, ,t ig-2:-, 4,1;5,,,te -...., ..o/:;.-,,-.-''''..I.A.'f.'r''.."..-'..'''!'-'•'-''''''':"'":''' ,,,, ,,,,,,,,,,,,,, ,,,„„,;,,,,,,,,„,,,,,,, •trf::,,;,',,,,,,,,..€ ,,,„..I.,,k 4,,,,,V",',",r';(," '",e-,,,,",:, ,'..,,Ifs''' -,:°',*A5',' ,,,,,- -..-- •,,,,,,,,,,,:',,,,,,,,,,,-.4,4," kriv"`?ita,4,,,,-.2,....41;7...",,,,,ii,,,..:12:4:-P4.:.;,",-A4*.',,,,,,,•;,4„.„:11,1,,,,q#4,,,•!.....,"0,,,4y -0-ift;‘,..,1 ,,/,,,,,,,,,,t,11 „...,,,,„,,,,,zsg'I,'-''A,--,,,,,v4t,t„,40&.:0W',. -r,,, -'.')•,°"' ,. 5e-51''''4,„,:fZe!,a4te,t4=';Yttit\,,Y1W4 lo,,,,y,'",,,ii4?;!;,A,V1,10 ''',',.' . 1 ,''''';,' ,...,,,,,,,.,,;; ,-.1,„,-.4p:44,TA44,74YY4--,,,y,.....- , :Ix'- ,,...t,;4:**..,.n,, ,,.. 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','''''.'''I ''' ''' ' ' ' '''. - . • ''''''',1 '';',';',)':'::::.=,'''-'7444t4',:.'4'.!•,::',„,-,;,:,,,,,,2tV,;„"„e,,:,1,4,,;"4,•,,,,,',":', ,:'„,„::,,, ,',,',..•:',1s,--/:,,,,4-, ,1, '-....:'--. ..4 ,,,-,-i,,,.; .;., 7-7' ..,,,„„,„,,,,,-„r,,°:"'''" ' ...,41, -r7ir.---'1'•'."'`-Z'tz*I';:."1:ti...'iteki'f'.`,''',',' ''«,,t4 ,..,, ,,,,,t,.,,,,,,Y.',, •- f,°.; .-'- ' „.,,,, ,,,,•,,,,,_4,1_,,,,4, ,,,,...,,,,, Th,,t,,,,,,, ,, ,, ,,, 1, 0 A , .. . . . , s ...„..,,,....1„„t„,,,,,,,,, ,,,,,,,,,,,,,,,,,,........22,,,ti. ,...:,z, •'•.,..t...N,"1 ,,;,-",.''3.7.3',,V,t,t4 43.?;.'3;:aVt''':'2•:3'';.*:,":10,4i,'•33• ;:,''''3•'''': ':: ',••Y,5,-"::'.2 Vq.,,fiype••'A;•',OKN„,',^ ••••.0%,13•^, ,^' •7,'`.''':::?:';''t,f,X,'^:!',:'•''''''' - '''''::',:':''''‘‘;':3:::1'//•;.:1':'''',:''`g;',.'44.-,,.,•;,*St,,A'''''' , ':9'''':'41%?'11.1.<114}4.itt' „1efor htimanc to remain outdoors(HH,>,2.0 Days per year when the heat and humidity could be so high that it will be tins By 2100 By 2200 (2080-2099) (2180-2199) -- -- i i , ' i,,,-1.<'''.' N tittle ,''''''',' " 41''''',,,,,'P,'',p l',. :, • 4,,,,,A4k* 7,6 2 ,.., - ' ' ,, ;;,::0,-.,.. -.-'4.:, ,4.11Z% "4,.• < ' 77 2 \.,,J'-- -t----•-'-:.1_-------- •',',,,','=,'".,-;•7-ii/ '''., ' 'i 1 ' ','1,., IV ,; TA ': 1 r i .,.. , ‘. 'tAtAir t : ••‘,•' ' ''Ihttt ,oftc. Ai 1'4 ..., •.7, th. '3* ,t3 JIk 1 ' 1''' 1 ':'-'- --::-::: 1.'''''' •rn:::: ''' , ".--f-----1 i'll•,:,.:Sok, 0 'F.'.... i---- ..,1----1--- E N,,,, t -----T. ' i- • , . ,•••-;., \ ' ' •-••••,--„„ , , .:, I . i'• t ' ".1 i, ,k \ . , , - , * \,--- , •---------i ; ‘,,,, ..,._...,,„- '''' 1 . ,•,:f5' % 1!:" ..., ._. ,c` , ', )::,7- It N ' t , .,. , ......." f t + 1.„..................i, , ,.. ..," ',,, CS '‘, ; j ‘,,k .1...-- ,_ , ,Y2 , cu t T ::‘• : 't . ' 7-* , 57.- • . , ,.. - a III IIII III <ievery io years op I .4b 10 ,',15 20 25 30 45 Data Source:Rhodium Group 30 RISKY BUSINESS The Econonic REsk ot Ctinete Change in the United States OP 7-3 '' I 2 ,a g�, ,� . 3 a '.t rt x a* f§S a n A .• days—potentially more than 2 additional months per To date,the U.S.has never experienced heat-plus-humid- year of extreme heat—by the end of the century.On the ityat this stale.The closest this countryhas tome was other hand,the region will also experience fewer winter in 1995 in Appleton,Wisconsin,when the HHSI hit 92°F. days with temperatures below freezing. (At the time,the outside temperature was 101°F and the dew point was 90°F.)The only place in the world that has But the real story in this region is the combined impact ever reached the unbearable F HSi of 95°F was Dhahran, of heat and humidity,which we measure using the Saudi Arabia,in 2003{outside temperature of 108°F,dew Humid Heat Stroke Index,or HHSI.The human bodrate y's paint of 95°F).Our research shows that if we continue on capacity to cool down in the hottest weather depends our current path,the average Midwesterner could see on our ability to sweat,and to have that sweat evapoanu HHSI at the dangerous level of 95°F two days every on our skin.Sweat keeps the skin temperature below year by late century,and that by the middle of the next 95"F,which is required for our core temperature to century,she or he can expect to experience 20 full days stay around 98.6°F.But if the outside temperature is a in a typical year of HHSI over 95°F,during which it will be combination of very hot and very humid—if it reaches a functionally impossible to be outdoors. HHSI of about 95°F—our sweat cannot evaporate,and our core body temperature can rise until we actually collapse from heat stroke.Even at an HHSI of 92°i.,core body temperatures can get close to 104°F,which is the body's absolute limit. RISKY BUSINESS The Economic Risks of Climate Change In the United States .i L‘,/?...3(/ poi- Cr- .. !. , r 3a' . a •` t "7'x$ . : I., :',. ,, , un a+� � . c-, ,,i: l -i i4N :. , ,4,;: , _ ?. ''lr it' A4. ,�40 § r T* 4 .f# t; ii, YF, 74 .E .. '?a' br_. 4 >* 4.,1 ,til ��e f''',I ,, ,I,, l'c"'.. S ; ti•..'. ,„ 10 A . ,. /, „ .., Ah 4 ,,i, _ The Great Plains region stretches from The southern and coastal parts of this region will also the far north (Montana) to the far South experience the sea level rise impacts on coastal corn- (Texas) om- (Te a )r Climate impacts will be felt very munities that we've already discussed.In Texas,where differently in the northern and southern about one-third of the state's GDP is generated in coastal parts of this region counties,sea levels at Galveston,for instance,will likely rise by 1.5 to 2 feet by mid-century and 3.2 to 4.9 feet by In the southern states of the Great Plains region(Texas, the end of the century,with a 1-in-100 chance of more Oklahoma,and Kansas),our research shows an increase than a 7.6-foot rise. in extremely hot days.The average resident of these states experienced 35 days per year over 95°F in the Though the north and south sub regions of the Great past 30 years.This number will likely increase by 26 to 56 Plains have starkly different climates,all the states in this additional extremely hot days by mid-century and 56 to region rely on two important climate sensitive industries: 108 days per year by the end of the century—for a total agriculture and energy. of between three and four months of additional extreme Altogether,80%of the region is devoted to cropland, hot days per year. pastures,and range land,which produce$92 billion in At the same time,the northern parts of the region will agricultural products each year.The story for the region's likely see a significant decrease in extremely cold days: agricultural sector is mixed:The more southern states from the average of 159 days per year of below-freezing may see declining crop yields as temperatures continue weather over the past 30 years,to between 117 and 143 to rise,while the northern states may actually see yield freezing days at mid-century,and between 79 and 122 gains,though this will depend on a number of factors, freezing days by the end of the century. including water availability.(See the Southwest section for a more detailed discussion of this factor.) 32 RISKY BUSINESS 1 The Economic Risks of Climate Change in the United States y 2/23i s Cfl 14- ,.. . ';ie.:1-' y*. i� 1 7 .ff t `. 4j �. �.i�'" ... ; r i r it r i,-.----;,..- �,-_ t..a r" i _ ;,a a t rtt r t� � h �, 1� 4 r GREAT PLANS: AVERAGE SUMMER T Nfii� AT, , $•,. , , .,..4.........„f:,..,:t,..„...:.,a k� kdF F" pp Et Energy:The largest increases in an Agriculture:1'he electricity cansumption occur in the '� southernmost states Great Plains region,with electricitymayseedecliningdemand likely growing by up to 6%over the trop yields os temperatures con- next 5 to 25 years in Oklahoma.8y mid-century, time to rise,while.the northern climate-driven changes in air conditioning use will �� age states may see yield gains. likely result in a 3.496 to 9.2%increase in electric- by demand in Texas and a 3.196 to 8.4%increase for the Great Plains region as a whole. Sea Level Rise: The southern and coastal parts of this region will experience sea level rise In Texas,sea le impacts on coastal communities. vels will likely rise by 3.2 to 4.9 feet by 2100. Average Summer Temperature(°F) 50 70 74 77 80 83 $b $4 42 45 100 110 Data Source:Rhodium Group 33 RISKY BUSINESS the Economic Risks of Climate Change in the United States lCid 1,i /04- - ., X. l rie n ,nim-...,........ . . .. . ., .. ... . , .. . , ,,,,, ,, . '..111,11„2,.„...'11-'(,-;--„,„„.4,-,.,,,-;,--_, ,-.,,h1 .,,,,‘, ....„,,,,Ti,.,,,,,,,,,,,, , , . , Ak-ftt"ii, ,t;:::—/:' ..F, '8-". .>,,,,,,:,.„ , , , 's;; ' i '''': ' -. ^` i t $ �� ,�,s <�.�: : rME ' • y ' IDA At the same time,the region is a major energy producerpower sector.As soon as 5 to 25 years from now,our for the nation,making climate impacts on the energy research shows a 0.7%to 2.2%likely increase in nation sector particularly important for this area.Texas and wide electricity consumption.The country will likely see Wyoming alone produce half of U.S.energy(primarily a roughly corresponding decline in demand for heating, from crude oil and natural gas in Texas and coal in as temperatures warm up in the northern states,but Wyoming),and North Dakota has recently become a the switch from natural gas and fuel ail driven heating major oil and gas producer. Power generation facilities demand to electricity powered cooling demand has in the region currently meet about 17%of the nation's significant implications for the U.S.energy system. overall electricity needs.'" The largest increases in electricity consumption occur in the If we stay on our current path,our research shows a Great Plains region,with likely electricity demand growth significant increase in demand for air conditioning over in Texas and Oklahoma of up to 5%and 6%respectively the course of the century which,when combined with over the next 5 to 25 years.By mid-century,climate driven other heat-related impacts such as reductions in power changes in air conditioning will likely result in a 3.4%to generation and in transmission efficiency and reliability, 9.2%increase in electricity demand in Texas and a 3.1%to could place a considerable burden on the electricity 8.4%increase for the Great Plains region as a whole. - - a, , ,. tuf2040059)y ,C 8% Electricity Demand 6.8°1 o 60/0 ,:. Energy Cost 5,3/� 5.4% ii, ,5,9/o_: S. % f- a4.3% : -;', 44, '4% 15% ' 2.6°l° 2.9% F Zl°Io a v ,,,.,, ;i:j„.".1,,,,if,.:,;,:f..,i;fr'.'''-;:‘:i`flit%;•:::.,' ,,,,4%;;;?1;;:t:i,,i '4''''',',.' ;.i7:..,;,..;....:::t.i), :''''''''/ - s ,I�A i l -O.b°1° -2% -2.8% -4% Northwest Northeast Southwest Midwest Southeast Great Plains Data Source:Rhodium Gro,:p n. ,- M ''. ' IA.K'K.N65'.PS:E'i — .. .. .. .. 34 RISKY B U S I N E 55 The Economic Risks of Climate Change in the United States 3, 'Fit g a r Vis. � 3 '4 viiia � .r ^ �%$. ,,.ate, C _ '.,,,t.," �v A _ y2 ,..'",11F;ei t: �.«.^� 4�f t $ e e a apliM..RY . rAFr _ r€r. sfE M � 6 k t ' ' .. , fftaf i 0 A ,,,,,,,,,,..,,,„..,,,,,,,..,..,,,,„,, #a d . fes' . _ `''�'�5gi Ro sst h.'3 x " ',, ��" #} l ash; ,� n ,z'� 0 iiNhf „ t r+� ' , ,3 ' „fir "E �§ to 1 ',i,.'',, ,4'.,,sr,e‘ ,'t--‘ .' , '- i'Ni:siitg","'itiez-..!..'''' ,'''''">. ' ,-' i'v$,Td. c-,,,, ' °t ,464,,,, k , ---A,,,,,, k . -4, : ': ,'.;,:, .''., ::?'''7z '..','''.-L!:''': '';-•:-•ii•,4',., '''4 'kt:i'V4..4'" '6` '4' ' '''''-. ,'4', ", 1'64 "'''''''i: 0 '''\'' i '- , ' ‘••, '-, ' ' ',.',11,--,;;I,g i.',': iii:,:d,iii,;,,,,ti:* ,-74'' -t, i ,-, I -1.4 ,4:..,....,,,,i-ofp0k17,71-,,t;'',.. Li',,,2..`,,,i-ing., — ,I ., 1 i k + _ Shipping crones at the Port of Houston Most of this increase will occur during times of the day All of this could have a significant impact onf the econo- when electricity consumption is already high.Meeting my of the Great Plains. In addition, many of the region's higher peak demand will likely require the construction current energy-production facilities----from power plants of up to 95 GW of additional power generation capacity to oil and gas platforms—are at risk from climate driv over the next 5 to 25 years,the rough equivalent of en increases in storm surge and potential changes in 200 average-size coal or natural gas power plants. hurricane activity, If these facilities are flooded,the Constructing these new power-generation facilities will, region will lose electricity and energy resources just as in turn,raise residential and commercial energy prices. the country's need for them is growing. Our research concludes that climate-driven changes in heating and cooling will likely increase annual residential and commercial energy costs nationally by$408 million to$12 billion over the next 5 to 25 years and$8.5 billion to$30 billion by the middle of the century. 35 RISKY BUSINESS The Economic Risks of Climate Change in the United States fir °:� ..'� rKi ic �c.. ;r,E�,sc //OA- Ct � " s.r s ✓2 :rbtp7; n 7 r zs e3 s > ys, cta 3p* �� ,� ajrp>r �' , ar0; , 0 A ' E The pacific Northwest is a good example 1.6 to 3.0 feet between 2000 and 2100. Looking out to of the general truth that similar climate the tail risks,though,there is a 1-in-100 chance of more impacts may be felt differently from one than 5.9 feet of sea level rise by 2100 in Seattle. region to another. The economy of the Northwest is dependent on its coastlines,but it is also heavily dependent on its forests. For example, by mid-century this area will have Oregon and Washington are the number one and two • fewer additional extremely hot days than,say,the softwood-producing states in the nation,respectively;2b Southeast—but the average Northwest resident will these two states plus Idaho produce more than$11 likely go from experiencing only 5 days of 95°F or billion in primary wood product sales.27 Our review of warmer temperatures per year on average for the past existing research suggests the Northwest's forests will 30 years to an additional 7 to 15 extremely hot days by experience significant potential impacts from climate mid-century,and to an additional 18 to 42 extremely change,in particular from wildfire—due to both in- hot days by the end of the century.This represents creased drought and to wood damage from pests surviv- an increase of 3 to 8 times the number of hot days for ing warmer winters.One study we reviewed found that if the region per year,which is a significant change from temperatures rise 32°F by mid-century,this could lead to historic norms. 54%increase in the annual area burned in the western U. This region is also coastal, but the extent of expected S. The same study found that the forests of the Pacific sea level rise here is more varied than the east coast. Northwest and Rocky Mountains will likely experience the Because the area is relatively close to the Alaskan greatest increases in annual burn area(78%and 175%, glaciers,the Earth's gravitational field may lead to respectively). the ice melt in Alaska actually lowering sea levels off Washington and Oregon.At the same time,West Antarctic melt may lead to higher sea level rise in the Northwest over the long term.This latter effect is captured in our analysis of the"tail risk"of sea level rise in the Northwest.Overall,our research shows that if we stay on our current path, sea level at Seattle will likely rise by 0.6 to 1.0 foot between 2000 and 2050 and by 36 RISKY BUSINESS The Economic Risks of Climate Change in the United States 3 3 , 3 g 1 : Y w t.lht AMi r :-'.".':•-',1:" ° / �4 � 4 4 �}Y 1 � q lit tAtti 11 t.�l i at ', alt i' !i l 1361 �,, drA 14i _��' .. fit ? p A. 1;11-'6'2'5'4 ''� v .k � ,,1-,,, e'ir5;y ill .°� ,-'; *?'N%� �; 1F 1Q4 NORTHWEST: AVERAGE SUMMER TEMPERATURE BY 2100 & KEY IMPACTS Sea Level Rise:If we stay on our current path,sea ' ' level at Seattle will likely rise by 0.6 to 1.0 foot by mid-century and by 1.9 to 3.4 feet by 2100.Looking out to the tail risks,though,there is a 1-in-100 chance of up to I ft 5.9 feet of sea level rise in Seattle by the end of the century. 1 b ' er fi_ i Sd„i i% $%u � fpr ;f Ffi u "A 's Ai "` f I•: ,`0?IA Heat:The average Northwest resident will likely go from experiencing only 5 days of 95"F or warmer temperatures per year on average for the past 30 years to an additional 18 to 42 extremely hot days by the end of the century. Average Summer Temperature(OF) 9 ' ®•u 50 70 74 77 80 83 86 89 92 95 100 110 Data Source:Rhodium Group RISKY BUSINESS The Economic Risks of Climate Change in the United States 37 " „ IT, h G p 01 fiy 1 0 The Southwest region includes the tra- ditional Southwest states—Arizona, Col- orado, Nevada, New Mexico, Utah—and also California.As such, it is an extremely diverse region that in some ways serves as a microcosm of all the climate impacts we've discussed so far, This region is already warm and dry—about 40%of this area is covered by desert”—and is likely to become more so in the coming decades.Over the past 30 years, bvitd,'and Fnf/Igr;rer the average Southwest resident experienced 40 days per year of temperatures of 95°F or more.If we con- by 1.9 to 3.4 feet by the end of the century.But the real tinue on our current pi.a , by mid-century the average sea level risk in this region is in the tails.The California Southwest resident will likely see 13 to 28 additional coastline is more exposed to sea level rise resulting from extremely hot days.By the end of the century,this Antarctic melt than the global average,and there is a number will likely rise to an additional 33 to 70 days of 1-in-100 chance that sea levels could rise by more than extreme heat due to climate change.That translates to 6.3 feet by 2100 in San Diego. one to two additional months of days over 95°F each year within the lifetime of babies being born right now San Diego is of strategic importance to the U.S.military: in this region--one of the fastest-growing in the United The city is home to three Marine installations,including Marine Corps Base Camp Pendleton,three naval bases, States. and a Coast Guard station.Fortunately,the military is one Because it includes California,the Southwest is not just of our country's leading institutions in terms of acknowl- one big desert;it is also an extremely coastal region. edging the potential impact of climate risk on its instal- Eighty-seven percent of all Californians live in coastal lations here and throughout the U.S.The Department counties,and 80%of the state's GDP is derived from of Defense's 2010 Quadrennial Defense Review called those counties.Along the coastline of San Diego,if we for a climate impact assessment at all DOD's permanent continue on our current path,sea level will likely rise installations,and several studies are already underway.24 by 0.7 to 1.2 feet before the middle of the century,arid 38 RISKY BUSINESS The Economic Risks of Climate Change in the United States 1 ii /4.15 /V/( d t' .» ... 0 . ....„.„..0.,.,„.„,,w,.-::::14.0. 4;"4',',.q: �. � " r . tN4.i,tt44.1.11.,,,,,,,.. -, .. �t`k'. ; ?%9 9 fin:; } "w:Nstak,,,,„..410v„,„„,„,,,..„.„:„.. // W ltmn,3 Heat: On our current path,by the end of the century,the average South- west resident will likely experience an additional 33 to 70r days of extreme heat due to climate change.,or one to two additional months of days over 95"F each year. 1,,,4; �z t � r� 'z r -1�3t ;;;;',1,!t- kr,;',,-:,..„.„.".,,,: i.ditik,,,,,. -- ,,,,,,!,,,,,,,,,,„"..00,,,,,.1, �° r� 3 .1 .mss t 1 t-,-;it:.>.,.::zf:f:::.,,,.cia.ifi,...,!k...„, '' :'7-7.-,'--: ''';:-'':' , , --.:„„„.,,,,,,„-„,,,,,,,,„,„,..: ,„„„,::, ::, „,,,,,,,,,,,,,,,ty:.,,..t.o.,:, . limIllaissior .„.$111L:.„,,,,„„,•,15taio i:.,.',.''., , � r? !u. .:y. ,5 Ili sk: aY t' 3;�' d� .....-1$4611,,,.;',,A111,0,;44',..:•.7::.: .. .- Sett illk - ��V ,. Sea f s % all ifliv in coastalLevecounties,Rre:87and of 80%,Calof theornians state'se those nAlong the coastline of San Diego,if we co GDP is derived from thntinue oncouour ties.current liviraiireiS7u4mame77r Temperature(°F) path,.• sea level will likely rise by 1.9 to 3.4 feet by 2100. 50 7D 8D 83 86 D4 92 45 1D0 110 Dota Source:Rhodium Group RISKY BUSINESS The Economic Risks of Climate Change in the United States 39 Zeis 104 C4 L / Jj IDA In part because of tectonic plate activity in California,sea As the Southwest climate heats up,the region is likely to level rise will vary across the state:Los Angeles(13 to 3.0 see significantly less snow in the mountains,leading to feet by 2100),Santa Monica(1.7 to 3.1 feet by 2100),and decreases in spring runoff especially in California and the San Francisco(1.8 to 3.2 feet by 2100)will likely see lower Southern Rockies.Extreme heat may also lead to higher rise than San Diego. evaporation of existing reservoirs.This translates into less available groundwater for critical industries such as While extreme heat days in the Midwest and Southeast agriculture,as well as for simple drinking and bathing. will likely be coupled with high humidity,here in the Even as temperatures rise,increased energy demand Southwest the days will likely be hot and dry,increasing from air conditioning will likely lead to increased water the potential of wildfires and drying up water sources. demand,since electricity generation is heavily water-de- While we did not quantify the impact of climate change pendent.Decreased water availability is also likely to be on either forestry or water availability,these are signifi- the most significant impact on this region's agricultural cant climate risks in the Southwest region,and both are industries,which tend to be non-commodity crops(tree ripe for further analysis. nuts,fruits,etc.)and therefore are not included in our quantitative analysis of the agricultural sector. A broad range of issues impact real estate, construction, and urban development. Obviously c()astai inundation is one of those„Another er is the implication of extreme weather eventt�;f ' t fi£ t�1t:rnal i r-rs of the . mo,rnofthe most water scarce r oI"_eas of the country ore due to get less precipitation. Areas that are dry are going to get drier. And that has immense implications fhr cites in the west. —Risk Committee member Henry Cisneros 2'' 4 RISKY BUSINESS The Economic Risks of Climate Change in the United States g `zisl'':s cam.F .. ...... . . ...... . . - . -, . , . . . . . . . . . . : ,. IDA F �R R3 > �y �� `�. •:.. �1``� . •�l � � �'�3. msa 9' SgE T.'t ' yyam. .✓ y� } '�¢ t �.'smE. �p P^ "7. 'te ... "� •»,.-- a ...,...,....e.„..,,,*,,,,,,,,,,:. Frt'�t .' e9�'•i � L'A' ;°*. ,. . tee,:.. ... ---;"(7. ;� .ate � „.„, -m`- d ,. . a •.. R I SKY BUSINESS The Economic Risks of Climate Change in the United States 41 es c 1 ALASKA► 1 A v�. Alaska is ground zero for U.S. climate impacts. The state relies heavily on three climate-sensitive commodities: oil and gas, minerals, and seafood. µ { ._ � , • More than 80%of the state's GDP comes from oil and gas production,and so increases in energy demand(as discussed above)will dramatically affect this region. Meanwhile,fisheries and tourism,the third and fourth largest contributors to the Alaska economy,depend on Alaskan fisheries rely heavily an healthy oceans healthy oceans and coastal ecosystems. Our research shows major climactic changes in Alaska counties.Sea level is variable around the state,due to the over this century.If we continue on our current path,by proximity of the glaciers and to shifting tectonic plates. mid-century Alaska's average temperature will likely rise As in the Pacific Northwest,the state may actually see sea to between 3.9°F to 8.0°F warmer than it has been over levels go down over the course of this century:Our re- the past forty years.By the end of the century,tempera- search shows that sea level at Juneau will likely fall by 1.6 tures will likely rise by 7.6°F to 16°F,but there is a 1-in-20 to 1.9 feet between 2000 and 2050 and by 2.4 to 3.5 feet chance that they will rise even higher,by as much as between 2000 and 2100.On the other hand,Anchorage 19°F.The bulk of this warming is likely to happen in the will likely experience between a 0.6 feet sea level fall and winter months,significantly decreasing the number of a 1.2 feet sea level rise by the end of the century,with extremely cold days that Alaska now experiences.Up a 1-in-100 chance of more than a 4.0 foot rise.Prudhoe until 2010,Alaska experienced about 188 days per year Bay is likely to experience 2.3 feet to 4.5 feet of sea level below freezing;our current path will likely decrease these rise by.2100,with a 1-in-100 chance of more than a 6.6 freezing days by 14%to 25%by mid-century,and by 30%o foot rise. to 50%o by the end of this century. The state is heavily coastal:84%of Alaskans live in coastal counties,and 86%of the state's GDP comes from these 42 RISKY BUSINESS The Economic Risks of Climate Change in the United States 6123 /5 /QA- u . HAA AII. +`Suw , 0 IOA YMV. IS As Alaska is at the center of climate Hawaii cannot reasonably be looked at as a stand-alone impacts from melting ice, Hawaii is at the region,however: This state imports the vast majority of center of impacts from sea level rise. This its food and energy,arid is interdependent with the rest state is 100%coastal in both its population of the U.S.as well as the rest of the world.The recent and GD?. tsunami in Japan and typhoon in the Philippines have awakened many businesses to the impact of a changing Hawaii is expected to get significantly warmer:On our climate on global supply chains,"'and ultra-dependent regions like Hawaii are by necessity very sensitive to current path,by mid-century average temperatures will these realities.Changing agricultural yields on the main- likely be between 1.6°F to 3.6°F warmer than tempera land may have a significant effect.on Hawaii in terms of tures over the past 40 years.By the end of the century, food cost and availability.Similarly,higher energy costs in temperatures will likely increase between 3.7 and 7.7°F. the continental U.S.are likely to drive the cost of import- There is also a small but not insignificant chance that ed energy even higher for Hawaii.T he state is pushing Hawaii's average temperatures could rise as much as forward to diversify its energy resources and rely more 9.4°F by the end of the century. on domestic renewable sources; however,most of these Sea level rise in Hawaii is greater than the global average, installations are along the vulnerable coastlines. and the extreme dependence of this state on the coasts will only intensify this impact. If we continue on our current path,sea level rise at Honolulu is likely 0.8 inches to 1.2 feet greater by mid-century,and 2.1 to 3.8 feet by the end of the century.Looking out at the 1-in-100 tail risk,sea level at Honolulu could rise by more than 6.9 feet by 2.100. RISKY BUSINESS The Economic Risks of Climate Change in the United states 43 /2A Ck- "I tnin < we have to begin oy recognizing the reality anc severity of this threat to our economies, ooth Unitec States anc globally, anc really to life on ear--..h more broadly as we <now it. We also nave to recognize that this proalem needs to be cealt with now. We cannot wait oecause green nouse gases in the atmosphere, once they're there, remain there for centuries so that every year is greater anc more severe in terms of greenhouse gas emissions cumulatively than hac peen the case the year before. - Risk Committee member Robert E. Rubin 10k � r 7•144trawit% 1":7= til t a w R0M K aVF If we were told—in any sphere—that we had at least a 90945 chance of averting a disaster through changes we ourselves could make, wouldn't we take action? —Risk Committee member Olympia Snowezg A aking a classic risk assessment approach to climate policy actors,as well as their particular region or sector change in the U.S.leads to the inescapable conclusion of the economy.But the Risk Committee does believe, that if we continue on our current climate path,the based on this project's independent research and the nation faces multiple risks across every region. significance of the climate risks it demonstrates,that it is time for all American business leaders and investors to But risk assessment is not just about identifying risks and get in the game and rise to the challenge of addressing leaving it at that.Our research also shows that if we act climate change.The fact is that just as the investments and today to move onto a different path,we can still avoid many economic choices we made over the past several decades of the worst impacts of climate change,particularly those have increased our current vulnerability to climate change, related to extreme heat.We are fully capable of managing so will the choices we make today determine what our climate risk,just as we manage risk in many other areas of nation looks like in 15 years,at mid-century,and by 2100. our economy and,national security—but only if we start to change our business and public policy decisions today. In short,we have a choice whether we accept the climate risks laid out above or whether we get on another path. The Risky Business Project was not designed to dictate a This is not a problem for another day.The invest- single response to climate risk.We know that there will ments we make today—this week,this month,this be a diversity of responses to our analysis depending on year—will determine our economic future. the particular risk tolerance of individual business and RISKY BUSINESS The Economic Risks of Climate Change In the United States 45 (titbits ' UA NEXT STEPS !here are three gt —era: area:7, of act:on that can help to minimize the risks U.S. busi- nesses currently face from climate change: ,t,—, ,• - ' "i'll'''1111P700';'47,44tiffirf'';21:•71f. 2.4:24.,L''4/0/44,14: „t e"? • ,otX. :Av;•*'' 4:-'"BUSINESS ADAPTATION ' —1Changing everyday business practices to suffer economic losses shifting to new crops(with *become more resilient, required newequipment and expertise),if they can afford to shift at all.Meanwhile,coastal states and #Some of the climate impacts we analyzed are cities are being forced to adapt to climate realities !ready being felt across the nation;indeed,some without adequate financial support from the federal already an unalterable part of our economic government. These public sector adaptation costs future.Rational business actors must adapt.The will only grow as the private insurance industry con- agricultural sector is on the front lines of climate tinues its exodus from the business of insuring coastal )11: adaptation.As Risk Committee member Greg Page real estate and the bond market begins to wake up to has noted,"Farmers are innovators and consuin. the vulnerability of key infrastructure investments to mate optimizers....They persistently demonstrateh I President of the climate change. As Donna S a a a, the ability to adaigfa chaffiges in the environment University of Miami and Risk Committee member,has 4teSsfullY in noted,"People in Florida really have thought through vor ittn, Aftrr;„ mmuni yrivate and public sector some of the consequences...to the extent that ming to adapt to present the", seawalls and changingcan do some thingstb through their governments,thrototutpitStatethey certain! 4:',11,;-#0,010Atte f",/ nize the reality of rising sea stepped up to do many of these thlrigs...but r5 oot,t. creased storm surge. 41:'446?°Oh.This is going to take a national investment 'jut this atptation may come at a price:Some 4;tfarmers In Midwest counties,for instance,may q4pjmiwMI1f , • INVESTOR ADAPTATION Incorporating risk assessment into capital investments.And real estate investors are making multiple bets on residential and commercial expenditures and balance sheets. proper- ties.These investments must be evaluated in terms Another area where today's business investments of the actual climate risk specific regions face as we have a direct relationship to tomorrow's climate approach the middle of this century.In 2010,rec- Jff in is in long-term capital expenditures, ognizing this reality,the Securities and Exchange 111ktyeAfirAtipp the middle of the century Commission(SEC)issued InterpretiveGuidance on ings agencies are evaluat- climate disclosure,giving companies some idea of t4IEig• frsv4;ctrep-f ;-ejects with a multi-decade how to consider their"material"risks from climate Ing investments in new change;unfortunately,as of 2.013,ov.er 40%oft .c..f!„. .),,,,, , • ,1 "i/%1%ii and signing idntterrh ponies listiVn the Standark,, oor,,,,,(7, 00 1. xo'h'al,/,/:1's ts that rely oh those still not disc105.! -, „ . L. W /i /off eii2 ' IOA NEXis STEPS PUBLIC SECTOR RESPONSE ,; Instituting policies to mitigate and adapt to But the path we're on today does not have to be the climate change. path we choose to follow tomorrow.Our analysis also looks at alternate pathways that include invest- j`, Ultimately,climate change is not just an issue fpr ments in adaptation and policy efforts to mitigate ;. specific sectors and regions:It is a global i a lf) ; 71ate change through lowering greenhouse gas demands an effective policy response �� 1! , dons.These alternate pathways could signifi- Accordin to the latest Intergovern 7� According change the climate impacts we discuss above. on Climate Change report,the world may have as For example, modest global emission reductions can r little as 15 years to"keep planetary warming to avoid up to 80%of projected economic costs result a tolerable level,"through an aggressive push to ing from increased heat-related mortality and energy bring down carbon emissions.a° demand. In the Risky Business Project,we focused primarily Our goal in this risk assessment is not to dictate on modeling our current economic path and the those policy pathways.However,we do strongly urge ' attendant climate risksB use this is theath p the American.business community to play an active we're now following as a n ' n,we need to better role in the public discussion around climate mitiga- understand the potential r` , it poses and decide tion and preparedness,which we believe is the single „_ howto respond to those ri --e5 se ,. p ., . . most effective way for businesses to decrease the that are already embedded in our economy be- risks we have identified in this project. cause of decisions we made decades ago. RISKY BUSINESS The Economic Risks of Climate Change in the United States 4P 1IS /a� C 1 0 A FROM RISK ASSESSMENT TO RISKMANAGEMENT. NEXT STEPS a With this project,we have attempted to provide a tisan language describing the risks our nation may face common language for how to think about climate risk— from climate change,we can use it as the springboard built upon a common language of risk that is already for a serious,non-partisan discussion of the potential part of every serious business and investment decision actions we can take to reduce those risks. we make today. If we have a common,serious,non par- 48 RISKY BUSINESS The Economic Risks of Climate Change In the United States i . ' A (p�i 3�i S (o�1' C�`✓ y�rr 'a.+��rr x d a� t s �-s �� CONCLUSION 1 42 4,.'-,,,4 , & ,+• AML' x,y9 Y34R' hien Risk Committee member George Shultz was the Montreal Protocol on Substances that Deplete the serving as President Reagan's Secretary of State in 1987, Ozone Layer,an international treaty still in effect to this he urged the President to take action on that decade's day. hotly contested scientific issue:the ozone layer.As Shultz later said in an interview with ScientificAmerican,"Rather Our goal with the Risky Business Project is not to z confront the doubters.Rather,it is to bring American than ga and confront the people who were doubting it and have a big argument with them,we`d say to them: business and government doubters and believers Look,there must be,in the back of your mind,at least a alike—together to look squarely at the potential risks little doubt:.You might be wrong,so let`s all get together Posed by climate change,and to consider whether it's on an insurance policy."35 That insurance policy became time to take out an insurance policy of our own. I RISKY B-SIN E$$ The Economic Risks of Climate Change in the United Statesti ! z �s /1- Oz- END Michael R.Bloomberg,interview for the Risky Business " U.S.Bureau of Economic Analysis,"News Release:Gross Project,Jun.17,2014,available at www.riskybusiness.org. State Product,"June 6,2006,available at http://www.bea. 2 American Cancer Society,"Lifetime Risk of Developing or govinewsreleases/regional/gdp_state/2006/gsp0606.htm. Dying from Cancer,"available at http://www.cancer.org/ '2 U.S.Economics and Statistics Administration,"The Gulf cancer/cancerbasics/lifetime-probabilityof-developing-or-dy- Coast:Economic Impact&Recovery One Year after the ing-from-cancer(last accessed June 2014). Hurricanes"(Department of Commerce,2006),available Congressional Budget Office,"The Productivity at https://www.esa.doc.gov/sites/default/files/reports/docu- Slowdown:Causes and Policy Responses"(Washington: ments/oct2006.pdf. Congress of the United States,1981),available at http:// 13 Joel Garreau,The Nine Nations of North America www.cbn.gov/sites/default!files/cbofiles/ftodor..s/113xx/ (Boston:Houghton Mifflin,1981). doc11304/1981_0 .01,_sfowdawn.pdf Brian Clark Howard,"West Antarctica Glaciers Collapsing, Fran Sussman,Cathleen Kelly,and Kate Gordon,"Climate Adding to Sea Level Rise,"National Geographic Daily Change:An Unfunded Mandate"(Washington:Center News,May 12,2014,available at http://news.nationalgeo- for American Progress.2013),available at http://cdn. graphic.com/news/2014/05/140512-thwaites-glacier-melt omericanprogress.orglwp-content/uploads/2013/10/ ing-collapse-west-antarctica-ice-warming. ClimateUnfundedMamiate REPORT.pdf. U.S.Environmental Protection Agency,"Heat Island „ Hank Paulson,video interview for the Risky Business Effect,"available at http://www.epa.gov/heatisland(last Project,August 28,2013,available at http://www.riskybusi- accessed June 2014);for a full list of the 52 metro areas riess.org. of the U.S.with more than 1 million people as of 2013, F Michael R.Bloomberg,video interview for the Risky see Wendell Cox,"Special Report:2013 Metro Area Business Project,August 28,2013,available at http://www. Population Estimates,"April 2,2014,available at http:// riskybusiness.org. www.newgeography.com/content/004240-special-re- port-2013-metro politan-area-population-estimates. Howard Kunreuther,Geoffrey Heal,Myles Allen,Ottmar Edenhofer,Christopher Field,and Gary Yohe,"Risk 16 Dr.Alfred Sommer,interview for the Risky Business Management and Climate Change"(2.013),Published Project,New York,May 14,2014. Articles&Papers,paper 172,available at http://research. 17 Ibid. create.usc.edu/published papers/172. 18 U.S.Department of Agriculture,2007 Farm and Ranch 8 PricewaterhouseCoopers,"A Practical Guide to Risk Irrigation Survey,Vol.3,(2010),available at http://www. Assessment"(2008),available at http://www.pwc.corn/ agcensus.usda.gov/Publications/2007/Online_Highlights/ enus/us/issues/enterprise-riskmanagement/assets/risk,as Farm,am/..Ranch_trrigation_Survey/fris08.pdf. sessment_guide.pdf, '9 U.S.Energy Information Agency,EIA Form 923,available Tom Steyer,video interview for the Risky Business at hitp://www.eia.gav/electricity/data/eia923. Project,May 14,2014. 23 Oregon Forest Resources Institute,"Oregon Forest Facts ' U.S.Global Change Research Program,"Regions& and Figures"(Portland,OR:2013),available at http:// Topics,"available at htrp://www.giobalchange.gov/explore oregonforests.org/sites/defautt/fiies/publications/pdf/ (last accessed June 2014). ORforest Facts_and Figures_2013.pdf. 50 RISKY BUSINESS The Economic Risks of Climate Change in the United States te4311s /eh I 0 A ENDNOTES 2t Oregon Forest Resource institute,"The 2012 Forest 29 Greg Page,"Commentary—Optimism about Agriculture's Report:An Economic Assessment of Oregon's Forest Adaptive Capacity,"The Chicago Council on Global Affairs • and Wood Products Manufacturing Sector"(Portland, Global Food for Thought Slog,May 23,2014,available OR:2012),available at http://theforestreportorg/ at http://globalfoodforthoughttypepad.cam/global food- downloads/2.012 Forest Reportpdf,Washington State far-thought/2014/05/commentary-optimism-about-agricul- • Department of Natural Resources,'Washington Mill tures-adaptive-capacity.html. Survey 7.010"(Olympia,WA:2012),available at http://www. >r Fran Sussman,Cathleen Kelly,and Kate Gordon,"Climate dnr.wa.gov/Publications/obe...econ rprt millsurv.,2010.pdf, Change:An Unfunded Mandate." Inland Northwest Forest Products Research Consortium, "Idaho's Forest Products Industry:Current Conditions 31 Freeman Klopott and Esme E.Deprez,"New York and 2011 Forecast"(Moscow,ID:2011),available at http:// State Sees Climate Change as Risk to Bondholders," www.idahoforests.orglimg/pdf/IDFP1.2011outtook.pdf. Bloomberg,March 26,2013,available at http://www bloomberg.com/news/2013-03-26/new-york-state-cites-cli- 22 D.V.Spracklen,L.j.Mickley,J.A.Logan,R.C.Hudman,R. mate-change-as-risk-to-bond-investors.htmi. Yevich,M.D.Flannigan,and A.L.Westerling,"Impacts of Climate Change from 2000 to 2050 on Wildfire Activity Donna Shalala,interview for the Risky Business Project, and Carbonaceous Aerosol Concentrations in the New York,May 14,2014, Western United States,"journal of Geophysical Research 33 Barry B.Burr,"Ceres:SEC needs to better enforce 114(D20)(2009):D20301,available at http://onlinelibrary. climate change disclosure requirements,"Pensions wiley.com/dai/10.1029/2008J0010966/abstract. and Investments,February 7,2014,available at http:// 23 U.S.Environmental Protection Agency,"Ecological www,pionline.com/article/20140207/ONLINE/140209893/ Regions of North America,"available atftp://ftp.epagov/ teres-sec-needs-to-better-enforce•climate-change-disclosure- wed/ecoregions/cec na/NA,LEVEL Lpdf. requirements. ?4 U.S.Department of Defense,"Quadrennial Defense 34 Justin Gillis,"Climate Efforts Falling Short,U.N.Panel Review Report'(2010),available at http://www.defense. Says,"The New York Times,April 13,2014,available gov/gdrtimages/QDR as of 12Feb10 1000.pdf. at http://www.nytimes.com/2014/04/14/science/earth/ un-climate-panel-warns-speedier-action-is-needed-to-avert- 25 Henry Cisneros,interview for the Risky Business Project, disaster.html?r=0. New York,May 14,2014. ;' David Biello,"A Republican Secretary of State Urges 26 Anders Levermann,"Climate economics:Make supply Action on Climate Change,"Scientific American,July 24, chains climate smart,"Nature,February 5,2014,available 2013,available at http://www.scientificamerican.com/arti- at http://www.nature.com/news/dimate-economics-make- cIe/questions-oridanswers-withgeorge-shuItz'on-cIimate supply-chains-climate-smart-1.14636. change-and-energy/. 27 Robert Rubin,interview for the Risky Business Project, New York,May 14,2014. 26 Olympia j.Snowe,"Challenging Climate Change,"Maine Policy Review,17(2)(2008):8-11,available at http:// digitalcommons.library.umaine.edu/cgiNiewcontent cgi?article=1117&con text=m pr. 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