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Climate change: a high price to pay

Due to the threats posed by climate change, crop failures could become more prevalent (WRENmedia)
Due to the threats posed by climate change, crop failures could become more prevalent

Drought, flooding, increasing storms and widespread crop failures are just some of the predicted consequences of climate change. In 2007 the United Nations Framework Convention on Climate Change (UNFCCC) estimated that the annual global cost of adapting to our changing environment by 2030 would be between US$40 - 170 billion. But, according to a newly published report, Assessing the Costs of Adaptation to Climate Change, the real costs of adaptation are likely to be at least two-to-three times higher.

"Previous estimates of adaptation costs have substantially misjudged the scale of funds needed. We should be planning for US$200 to 300 billion a year just for adaptation," states Professor Martin Parry, former co-chair of the Intergovernmental Panel on Climate Change and lead author of the study. "Finance is the key that will unlock the negotiations in Copenhagen," adds Camilla Toulmin, director of the International Institute for Environment and Development, publishers of the report. "But if governments are working with the wrong numbers, we could end up with a false deal that fails to cover the real costs of adaptation to climate change," she says.

A substantial underestimation

The authors also highlight that many of the sectors studied by the UNFCCC were incomplete. The estimate for water, for example, excluded the costs of adapting to flooding and made no allowance for costs for transporting water within countries. UNFCC estimates were also too low for sea level rise and, by assessing only three major diseases, included less than half of the total disease burden likely to emerge as a result of climate change.

Irrigation systems are one way of adapting to irregular rainfall patterns (WRENmedia)
Irrigation systems are one way of adapting to irregular rainfall patterns

Not only were UNFCC estimates too low but, warn the authors, key sectors including ecosystems, energy, manufacturing, retailing, mining and tourism were not taken into account. "The adaptation costs for ecosystems alone could amount to over US$350 billion a year, including both protected and non-protected areas," explains Dr Pam Berry, senior research fellow at the University of Oxford.

Assumptions on continuing low levels of development in Africa were also assumed in the UN's calculations; applying a 'climate mark-up' to low levels of infrastructure in developing countries produces low estimations of future costs because there is less to protect. But, warn the authors of the new report, if this 'adaptation deficit' is not resolved and infrastructure is not upgraded to an adequate level, "the enhanced investment for adaptation will not be sufficient to avoid serious damage from climate impacts."

With the number of people at risk from hunger likely to exceed one billion in 2010, the adaptation deficit in agriculture is particularly high. The Millennium Development Goals, if achieved, could make good this adaptation deficit, but this 'non-climate' investment is not considered in the UN's study. "If there aren't higher levels of development, people will continue to go hungry," cautions Parry. "US$100 billion will be a sticking plaster over current underdevelopment."

The 11 British scientists involved in writing the new report call for more detailed case studies to be undertaken, but warn that when 'bottom-up' case studies are combined, the total level of funding required is likely to be significant. One of the few examples already available for adapting a single watershed in China gives costs at US$1 billion a year. Another study concludes that adapting crop irrigation systems could cost US$8 billion per year by 2030.

Desertification is already occuring in some parts of Africa (© FAO)
Desertification is already occuring in some parts of Africa

In addition, the report highlights that the UNFCCC estimates do not include the costs of 'residual damage' that will occur where adaption is not possible or too expensive. "Some of the effects of climate change will be so adverse that we will see desertification of some areas of agricultural land and it will just be impossible to grow food," explains Professor Richard Tiffin, Head of the Agricultural and Food Economics department at the University of Reading. "We are already seeing this happening in areas of Africa and Australia." Up to 20 percent of the potential impacts of climate change for the agriculture, forestry and fisheries sectors might not be avoided, even with adequate levels of adaptation.

Negotiating a deal at Copenhagen

"Developing countries have a high expectation that there will be sufficient money at Copenhagen to finance adaptation either in technology transfers or in hard cash to invest in new development," Parry remarks. "This is in addition to covering their costs of reducing emissions." A draft climate proposal recently released by the African Union in the run up to Copenhagen suggests they will be asking for US$67 billion a year for adaptation in Africa. But as yet developed countries have only committed to around US$100 billion in total.

"The amount of money on the table at Copenhagen is one of the key factors that will determine whether we achieve a climate change agreement," Parry adds. "Poorer countries are unlikely to agree to anything until they are confident the world will provide enough money for adaptation." He concludes, "Yes, US$300 billion is a significant cost. But it frankly wouldn't dent the income of developed countries significantly. As often with these things, it's a matter of political will."

Date published: September 2009


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