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The US Economic Impacts of Climate Change and the Costs of Inaction
Written by Diana Thebaud Nicholson // October 16, 2007 // Climate Change, Economy // 1 Comment
16 October 2007
The total economic cost of climate change in the United States will be major and nationwide in scope, but remains uncounted, unplanned for and largely hidden in public debate, says a new study from the University of Maryland.
The range of climatic changes anticipated in the United States – from rising sea levels to stronger and more frequent storms and extreme temperature events – will have real impacts on the natural environment as well as human-made infrastructures and their ability to contribute to economic activity and quality of life. These impacts will vary across regions and sectors of the economy, leaving future governments, the private sector and citizens to face the full spectrum of direct and indirect costs accrued from increasing environmental damage and disruption.
“The true economic impact of climate change is fraught with hidden costs…”
The direct costs of not taking on the challenges posed by climate change are often neglected – and typically not calculated. The indirect effects are considered even less frequently, yet can be substantial. The effects will be felt by the entire nation:
All sectors of the economy will be affected.
Essential infrastructures for reliable services and high standards of living and health (such as water supply and water treatment) will be impacted.
Ecosystems, on which quality of life relies (such as forests, rivers and lakes), will suffer.
This study presents an overview of climate impacts on various economic sectors in the US, organized by region.
Five Key Lessons
Economic impacts of climate change will occur throughout the country.
Economic impacts will be unevenly distributed across regions and within the economy and society.
Negative climate impacts will outweigh benefits for most sectors that provide essential goods and services to society.
Climate change impacts will place immense strains on public sector budgets.
Secondary effects of climate impacts can include higher prices, reduced income and job losses. Download study
One Comment on "The US Economic Impacts of Climate Change and the Costs of Inaction"
From Jaime Webbe
Some numbers [from the study] …
In the Northeast, the maple sugar industry—a $31 million industry—is expected to suffer losses of between 15 and 40% in annual revenue.
The Northeast can also expect a decrease of 10-20% in skiing days, resulting in a loss of $405-810 million per year.
In California, an annual loss of $287-902 million is expected from its $4.1 billion dairy industry.
Spruce bark beetle outbreaks in Alaska could cause a 50% loss of harvestable timber, resulting in a $332 million annual loss.
The recent spread of Southern Pine beetle in Alabama, Louisiana, Mississippi, Tennessee, Kentucky and the Carolinas will, on average, cause annual losses of over 1% of gross state product.
New York State’s agricultural yield may be reduced by as much as 40%, resulting in $1.2 billion in annual damages.
Expected water shortages in California’s Central Valley are likely to generate annual losses of around $6 billion during particularly dry years. Agriculture around the San Antonio Texas Edwards Aquifer region is likely to suffer a similar fate. The regional impact may reach losses of $3.6-6.5 billion by 2030 and $6.75-10.13 billion by 2090.
Electricity demand in Massachusetts may increase by 40% in 2030 because of climate change alone, most of which will occur in summer months and require significant investment in peak load capacity and energy efficiency measures. Nationwide, the required investment may exceed $300 billion by the middle of this century