Climate change resilience could save trillions in the long run—but finding billions now to pay for it is the hard part

December 6, 2018 by David L Levy, The Conversation
City officials are working on ways to protect Boston Harbor from the effects of climate change. Credit: Richard Cavalleri/Shutterstock.com

Is your city prepared for climate change?

The latest National Climate Assessment paints a grim future if U.S. cities and states don't take serious action to reduce greenhouse gas emissions.

The bottom line is that the costs of climate change could reach 10 percent of the entire U.S. economy by the end of the century – or more than US$2 trillion a year – much of it in damage to infrastructure and private property from more intense storms and flooding.

Cities can greatly reduce the damage and costs through adaptation measures such as building seawalls and reinforcing infrastructure. The problem is such projects are expensive, and finding ways to fund the cost of protecting cities against future and uncertain threats is a major financial and political challenge—especially in places where taxpayers have not yet experienced a disaster.

I've been part of a team that has been evaluating options for protecting Boston, one of America's most vulnerable . Our analysis offers a few lessons for other cities as they begin planning for tomorrow's climate.

Investing in adaptation

A team of scientists from 13 contributed to the fourth U.S. National Climate Assessment, which recently laid out the stark threats Americans face from , more frequent and intense storms, extreme precipitation, and droughts and wildfires.

For example, the report notes that coastal zone counties account for nearly half of the nation's population and economic activity, and that cumulative damage to property in those areas could reach $3.5 trillion by 2060.

The is that investing in adaptation can be highly cost effective. The National Climate Assessment estimates that such measures could significantly reduce the cumulative damage to coastal property to about $800 billion instead of $3.5 trillion.

The report does not, however, examine the of implementing these adaptation solutions.

The adaptation devil is in the details

The Sustainable Solutions Lab at the University of Massachusetts Boston has been closely involved with its host city and local business and civic leaders in devising such climate adaptation strategies and figuring out how best to implement them, including a study I led on financing investments in climate resilience. Our work identified a series of hurdles that make financing such projects difficult.

One key problem is that while public authorities – and taxpayers – will ultimately bear the cost burden of coastal protection, the benefits mostly accrue to private property owners. Higher property taxes or new "resilience fees" will be on the table – and unlikely to be politically popular.

Another problem is that resilience investments primarily prevent or reduce future damages and costs but don't create much new value, unlike other public investments such as toll roads and bridges. For example, an investment in a sea wall might prevent property prices for coastal homes from falling or insurance premiums from rising, but it won't generate any new cash flows to defray the costs for the city or homeowner.

Constructing seawalls can be a modest and cost-effective way to shore up a city’s defenses against climate change. Credit: Gill Copeland/Shutterstock.com
Beware the big fix

In a separate study, we examined the feasibility of building a four-mile barrier across Boston Harbor with massive gates that would close if major storms threatened to flood the city.

We estimated that the project would cost at least $12 billion and could take 30 years to plan, design, finance and build. Ultimately we concluded it was unlikely to be cost effective and urged officials to abandon the idea.

One key problem is the uncertainty regarding the extent and pace of sea-level rise, which is forecast to reach anywhere from 2 to 8 feet by the end of the century. But we really don't know. By the time the barrier would become operational mid-century, we might realize that we didn't need it – or worse, that it is woefully inadequate.

As sea levels rise, the gates, which would be the largest of their kind in the world and take many hours to open or close, would need to be activated more frequently and could potentially fail. In addition, the cost of such a barrier would be difficult to finance in an era of growing federal deficits and would choke off capital required for other more urgent adaptation projects.

In other words, it's risky to put all our adaptation eggs in one very expensive basket.

The incremental solution

Instead, our group recommends that Boston and other cities pursue more incremental shoreline protection projects focused on the most vulnerable areas.

Examples include constructing seawalls and berms, elevating some roads and parks and creating incentives for property owners to protect their buildings. The key attraction of such an approach is that capital can be targeted in highly cost-effective ways to the most vulnerable areas that need protection in the short term. It also allows for more flexible planning as the science improves and climate impacts come into sharper focus.

Boston is already considering some projects like this that would cost around $2 billion to $2.5 billion over a decade or two. Coming up with that much money is still a big challenge, but it's far more cost effective than the harbor barrier.

Another benefit is that this neighborhood-level approach would facilitate more local economic development and community participation. While making these areas more resilient, such investments would also involve upgrades in housing, transportation and other infrastructure.

This would go a long way toward ensuring that the community and taxpayers are on board when the discussion turns to costs.

Fair and equitable

Adapting to will be a mammoth challenge for cities and citizens across the country – and world. Finding ways to finance adaptation in a fair and equitable way will be paramount to success.

Miami, for example, last year issued a voter-approved $400 million bond to pay for about half its planned resilience projects. In August – exactly a year after their region was devastated by Hurricane Harvey – most voters in Harris County, Texas, approved a $2.5 billion bond to pay for flood protection. And just last month, citizens in San Francisco approved a $425 million bond to pay a quarter of the costs of fortifying a sea wall.

One problem with these projects is the heavy reliance on bonds. We found that it would be better to spread the of protecting cities and towns across multiple levels of government and private sources of capital, and utilize a range of funding mechanisms, including property taxes, carbon-based fees, and district-level charges.

The hope is that voters and cities will approve such projects before disaster strikes – not after.

Explore further: Developing countries face rising payments due to climate change, says report

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13 comments

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MR166
2.3 / 5 (3) Dec 06, 2018
Climate science is just like the plant from Little Shop of Horrors...........Feed Me.....Feed Me.
MR166
2.3 / 5 (3) Dec 06, 2018
I see that France has finally had enough of this Progressive rape of the middle class. Here is hoping that it spreads to the US and that Trump gets the political support that he deserves.
guptm
5 / 5 (3) Dec 06, 2018
Efforts need be made at each level: house, municipality, district, city, state, country, continent, and earth. Then only we can combat this menace.
snoosebaum
1 / 5 (1) Dec 06, 2018
'''10 percent of the entire U.S. economy by the end of the century '' OMG! 10% by the end of century !!!!

lol it will lose a lot more than that when the debt blows up
MR166
5 / 5 (1) Dec 06, 2018
Don't worry in about 3 years they will have a new solution to the global cooling that is being caused by the solar minimum that is now occurring. Of course the solution will still require you to give up your personal freedoms and choices since they are the root of all of the earths problems real or imaginary.
david_king
not rated yet Dec 07, 2018
France has had enough of long term (20 years+) of 9-11% unemployment and static income growth in spite of promises for improvement to result from the difficult labor reforms that they've been putting up with over the last 18 months. They may have their climate skeptics but they've also experienced terrifying wildfires in the south and extraordinary flooding due to a warmer than ever Mediterranean. Droughts in the North have also made an impression this fall.
Da Schneib
5 / 5 (1) Dec 07, 2018
Oh, you deniers didn't realize it was gonna cost money?

Oops.
MR166
5 / 5 (1) Dec 07, 2018
It is all too simple to take any natural cycle and attribute it's bad effects to AGW or lack of human sacrifice. The high priests have been earning a living for 1000s of years this way.
MR166
not rated yet Dec 07, 2018
Today's climate models are nothing more than a modern equivalent of the covered wagons of old. "Doctors" were selling elixirs from them then just as they are now. The climate models are the vehicle of choice. Get your power from renewables and save the world.
antigoracle
not rated yet Dec 07, 2018
Oh, you deniers didn't realize it was gonna cost money?

Oops.

The Da Snob jackass brays again.
This is the jackass who boasted about his meat eating habit and further proclaimed that he had no intention of changing. And, he did this when commenting on a study that showed the meat industry was one of the biggest GHGs emitters.

Oops
MR166
not rated yet Dec 07, 2018
Despite claims to the contrary sea level rise has been pretty constant since the end of the ice age. There is nothing more despicable than scientists lying about historical data and using those lies for personal gain and power. Historical land temperature records have been "Adjusted" and used as a basis to scare the public into submission. It is this moral decay that will harm us more than any climate change.
MR166
not rated yet Dec 07, 2018
Similar examples of bad science killing millions of people is the DDT scare and the low fat high carb "Heart Healthy" diet. Both were proven to be based on falsified evidence.
snoosebaum
not rated yet Dec 07, 2018
''Oh, you deniers didn't realize it was gonna cost money?

Oops.''

yes, carbon taxes for the elites

Oops

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