southeast and caribbean and gulf of mexico climate

American Climate Prospectus: Economic Risks in the United States 1

Southeast and Caribbean and Gulf of Mexico Climate Community of Practice

October 17, 2014

Jamesine Rogers


The Goals

•! Provide actionable data for public and private sector decision-makers to incorporate climate risk into everyday activities

•! Create “safe space” for business and !nancial sector leaders to push for broader climate solutions

2


The Approach

•! Nonpartisan Risk Committee convened by co-chairs Paulson, Bloomberg and Steyer

•! Independent peer-reviewed risk assessment commissioned by Risk Committee (Rhodium Group & RMS)

•! Language of business Classic business risk assessment – no speci!c policy solutions

3


Risk Committee Members

4


Geoffrey Heal (Columbia)!Michael Greenstone (MIT)!"omas Rutherford (U of Wisconsin)!Karen Fisher-Vanden (Penn State)!John Weyant (Stanford)!Douglas Holtz-Eakin (AAF)!Roger Cooke (RFF)!Gary Yohe (Wesleyan)!Kerry Emanuel (MIT)!Katharine Hayhoe (Texas Tech)!Michael Oppenheimer (Princeton)!Linda Mearns (NCAR)!Klaus Keller (Penn State)!Michael Spence (Stanford)!Larry Linden (Linden Trust)!Robert Muir-Wood (RMS)!

Expert Review Panel Members

- Kerry Emanuel (MIT) - Gary Yohe (Wesleyan) - Karen Fisher-Vanden (Penn State) - Michael Greenstone (MIT) - Katherine Hayhoe (Texas Tech) - Geo"rey Heal (Columbia) - Douglas Holtz-Eakin (AAF) - Larry Linden (Linden Trust) - Linda Mearns (NCAR) - Michael Oppenheimer (Princeton) - Michael Spence (Stanford) - Jonathan Samet (USC) - Thomas Rutherford (U of Wisconsin) - Sean Ringsted (ACE Limited)

5

Regional and Sectoral Approach

6


Risks are Not Inevitable

If we act immediately, we can still avoid most of the worst impacts.

The only reasonable and responsible course is to alter the path we're on, and bring our carbon emissions down toward zero.

7


Looking Ahead

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8

American Climate Prospectus: Economic Risks in the United States 9 10 East 40th Street, Suite 3601, New York, NY 10016 Tel: +1.212.532.1158 | Fax: +1.212.532.1162 | Web:

www.rhgroup.net

American Climate Prospectus Economic Risks in the United States

Southeast and Caribbean and Gulf of Mexico Climate Community of Practice * Presented by Robert Kopp, [email protected] | October 17, 2014

Trevor Houser Rhodium Group

Robert Kopp* Rutgers University

Solomon Hsiang UC Berkeley

Robert Muir-Wood RMS

Kate Larsen Rhodium Group

DJ Rasmussen Rhodium Group

Amir Jina Columbia University

Paul Wilson RMS

Michael Delgado Rhodium Group

Michael Mastrandrea Stanford University

James Rising Columbia University

Shashank Mohan Rhodium Group

Prepared for the Risky Business Project

www.climateprospectus.org


Overview


Research approach Spatial Empirical Adaptive Global-to-Local Assessment System (SEAGLAS)

Physical Climate Projections

Econometric Research

Detailed Sectoral Models

Integrated Economic Analysis


Scope of coverage Far from comprehensive


Physical Climate Projections


Southeast Average Summer Temperatures

1981-2010

RCP 8.5 2080-2099

Median

1-in-20 Chance


Southeast Number of Summer Days over 95°F

1981-2010

RCP 8.5 2080-2099

Median

1-in-20 Chance


ACP Humid Heat Stroke Index Average days per year of Category II+ and III+ days, RCP 8.5

HHSI Category III+ >86F Extremely dangerous.

Comparable to Midwest during peak days of the 1995 heat wave.

HHSI Category II+ >80F Dangerous. Typical of the most

humid parts of Texas and Louisiana in hottest summer month, and the most humid

summer days in Washington and Chicago.


Changing seasonal precipitation Percentage change in average precipitation from 1981-2010 levels in 2080-2099, RCP8.5


Impacts


Example impact function: mortality


Mortality results


Mortality increase concentrated in southeast Additional deaths per 100,000, 2080-2099

-30

-20

-10

0

10

20

30

40

50

60

70

80

8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6

1-in-20

1-in-20

Likely Range

NORTHWEST SOUTHEAST MIDWEST GREAT PLAINS SOUTHWEST NORTHWEST USA


Extremes become the norm 1-in-20 year deadly heat wave expected about 10 years out of 20 by late century under RCP 8.5


Energy demand


Electricity demand and energy expenditures Increased cooling demand outpaces decreased heating demand in most regions by mid-century

-0.6%

2.6% 2.9% 3.5%

5.4% 5.9%

-2.8%

2.1%

5.3%

4.3%

6.8%

5.1%

-4%

-2%

0%

2%

4%

6%

8%

Northwest Northeast Southwest Midwest Southeast Great Plains

Electricity Demand

Energy Expenditures


Coastal communities


Inundation from Mean Sea-Level Rise MSL projections in 2100 under RCP 8.5 – Miami, Houston, Norfolk


Inundation from Mean Sea-Level Rise Share (left) and billion $ (right) of current property below high tide line RCP 8.5, 2100

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

AL

CA CT

DC

D

E

FL

GA LA

M

A M

D

ME

M

S

NC

N

H

NJ

NY

OR

PA

R

I S

C

TX

VA

WA

1-in-20

1-in-20

Likely Range

$0

$100

$200

$300

$400

$500

$600

$700

AL

CA CT

DC

D

E

FL

GA LA

M

A M

D

ME

M

S

NC

N

H

NJ

NY

OR

PA

R

I S

C

TX

VA

WA

1-in-20

1-in-20

Likely Range


Sea-level rise increases coastal storm damage Norfolk 100-year floodplain: Median RCP 8.5 sea-level rise, historical hurricane activity


Increased coastal storm damage from sea-level rise Relative (left) and million $ (right) increase in average annual coastal storm damage

0%

50%

100%

150%

200%

250%

AL

CT

DC

D

E

FL

GA LA

M

A M

D

ME

M

S

NC

N

H

NJ

NY PA

RI

SC

TX

VA

1-in-20

1-in-20

Likely Range

0%

100%

200%

300%

400%

500%

600%

AL

CT

DC

D

E

FL

GA LA

M

A M

D

ME

M

S

NC

N

H

NJ

NY PA

R

I S

C

TX

VA

1-in-20

1-in-20

Likely Range

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

$5,000

AL

CT

DC

D

E

FL

GA LA

M

A M

D

ME

M

S

NC

N

H

NJ

NY PA

R

I S

C

TX

VA

1-in-20

1-in-20

Likely Range

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

$20,000

AL

CT

DC

D

E

FL

GA LA

M

A M

D

ME

M

S

NC

N

H

NJ

NY PA

R

I S

C

TX

VA

1-in-20

1-in-20

Likely Range

2050

2100


Changes in storm intensity may more than double costs by 2100 Average annual per capita damages, RCP 8.5, 2011$, 2080-2099

$0 $200 $400 $600 $800 $1,000 $1,200 $1,400

USA

Connecticut Delaware

Maine Maryland

Massachusetts New Hampshire

New Jersey New York

Pennsylvania Rhode Island

Vermont West Virginia

Alabama Arkansas

Florida Georgia

Kentucky Louisiana

Mississippi North Carolina South Carolina

Tennessee Virginia

Illinois Indiana

Iowa Michigan

Minnesota Missouri

Ohio Wisconsin

Kansas Montana

Nebraska North Dakota

Oklahoma South Dakota

Texas Wyoming

Arizona California Colorado

Nevada New Mexico

Utah

Idaho Oregon

Washington

NORT

HEAS

T SO

UTHE

AST

MID

WES

T GR

EAT P

LAIN

S

SW

NW

$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000

1-in-20

1-in-20

Likely Range

Historic hurricane intensities Projected hurricane intensities


Agriculture: Changes in commodity crop yields


Changes in labor supply

Worker productivity could fall by as much as 3% in industries such as construction and agriculture.


High-risk Labor Share of state employment in high-risk sectors

0%

10%

20%

30%

40%

50%

60% N

ew Y

ork

Vi

rgin

ia

Mar

ylan

d

Rho

de Is

land

Fl

orid

a

Nev

ada

D

elaw

are

C

olor

ado

M

assa

chus

etts

G

eorg

ia

Con

nect

icut

N

ew J

erse

y

New

Mex

ico

A

rizon

a

Illin

ois

C

alifo

rnia

P

enns

ylva

nia

M

isso

uri

Mai

ne

Was

hing

ton

S

outh

Car

olin

a

Tenn

esse

e

Uta

h

Ala

bam

a

Nor

th C

arol

ina

M

inne

sota

M

onta

na

Neb

rask

a

Ohi

o

Mic

higa

n

Ken

tuck

y

Mis

siss

ippi

N

ew H

amps

hire

K

ansa

s

Verm

ont

Ark

ansa

s

Ore

gon

S

outh

Dak

ota

W

est V

irgin

ia

Idah

o

Okl

ahom

a

Wis

cons

in

Wyo

min

g

Texa

s

Loui

sian

a

Indi

ana

Io

wa

N

orth

Dak

ota


Economic Results


National Results: direct costs and benefits % of GDP, RCP 8.5, 2080-2099


Results Significantly Vary by Region Direct costs as a share (%) of economic output, median, RCP 8.5, 2080-99

-6% -4% -2% 0% 2% 4% 6% 8% 10% 12% 14%

USA Connecticut

Delaware Maine

Maryland Massachusetts

New Hampshire New Jersey

New York Pennsylvania Rhode Island


Alabama Arkansas

Florida Georgia

Kentucky Louisiana


Tennessee Virginia Illinois

Indiana Iowa

Michigan Minnesota

Missouri Ohio

Wisconsin Kansas

Montana Nebraska

North Dakota Oklahoma

South Dakota Texas

Wyoming Arizona

California Colorado

Nevada New Mexico

Utah Idaho

Oregon Washington

Coastal (Historical Activity) Agriculture Labor Energy Crime Mortality (Market) Mortality (VSL) NO

RTHE

AST

SOUT

HEAS

T M

IDW

EST

GREA

T PLA

INS

SW

NW


Results vary between states Direct costs as a share (%) of economic output, median, RCP 8.5, 2080-99

0% 2% 4% 6% 8% 10% 12%

USA

Alabama

Arkansas

Florida

Georgia

Kentucky

Louisiana

Mississippi

North Carolina

South Carolina

Tennessee

Virginia

Coastal (Historical Activity) Agriculture

Labor

Energy

Crime


Combined direct economic costs and benefits % of GSP, RCP 8.5, 2080-99 projected hurricanes and VSL mortality estimates


Large mitigation benefit for mortality Change in temperature-related deaths per 100,000 individuals, 2080-2099

-30

-20

-10

0

10

20

30

40

50

60

70

80

8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6

1-in-20

1-in-20

Likely Range

NORTHEAST SOUTHEAST MIDWEST GREAT PLAINS SOUTHWEST NORTHWEST USA


Smaller mitigation benefit for coastal impacts in 21st century Changes in average annual hurricane and coastal flood damage, 2080-2099 Billion 2011$

$0

$5

$10

$15

$20

$25

$30

$35

8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6 8.5 4.5 2.6

1-in-20

1-in-20

Likely Range

NORTHEAST SOUTHEAST MIDWEST GREAT PLAINS SOUTHWEST NORTHWEST


Scope of coverage Areas for future work


Key takeaways

•  By 2080-2099 under RCP 8.5, the NE, SE, and MW south of the Mason-Dixon lines have median projected summer T hotter than Louisiana today, and even north of M-D line have more expected dangerously humid days than Louisiana.

•  Mortality (using a value of a statistical life) & Labor are largest costs nationally. •  Energy & Coastal impacts sizable, and in some states (e.g., Florida), coastal impacts

are the dominant market losses. •  Agricultural losses are small nationally but important in some states (Iowa, Nebraska,

Mississippi, Arkansas). •  Southeast is most severely hit of all U.S. regions. •  Median national projected increase in deaths under RCP 8.5, 2080-2099, is about 10

per 100,000, similar to current traffic death rate. In southeast, it is about 25 per 100,000.

•  Mortality is the largest source of inequality (RCP 8.5 2080-2099 median, mortality in wealthiest 10 states falls ~3/100,000 and in poorest 10 states rises ~30/100,000).

•  Mitigation benefits largest and most certain for labor, mortality, energy, and crime. Agriculture benefits less clear because of carbon fertilization; coastal because of slow response of the system.

•  Largest source of uncertainty among quantified impacts is driven by physical climate. •  Largest source of uncertainty overall is the unquantified impacts.


Extra slides


Extremes become the norm 1-in-20 year crop loss event occurs every 4 years by 2020 and every 2 years by 2060


Heat/Cold-Related Mortality Per capita direct annual costs, VSL estimates in RCP 8.5, 2080-99

-$4,000 -$2,000 $0 $2,000 $4,000 $6,000 $8,000 $10,000

USA

Connecticut Delaware

Maine Maryland

Massachusetts New Hampshire

New Jersey New York

Pennsylvania Rhode Island


Alabama Arkansas

Florida Georgia

Kentucky Louisiana


Tennessee Virginia

Illinois Indiana

Iowa Michigan

Minnesota Missouri

Ohio Wisconsin

Kansas Montana

Nebraska North Dakota

Oklahoma South Dakota

Texas Wyoming

Arizona California Colorado

Nevada New Mexico

Utah

Idaho Oregon

Washington

1-in-20 1-in-20

Likely Range

NORT

HEAS

T SO

UTHE

AST

MID

WES

T GR

EAT P

LAIN

S SW

NW


Labor Per capita direct annual costs, RCP 8.5, 2080-99

-$200 -$100 $0 $100 $200 $300 $400 $500 $600 $700 $800

USA Connecticut

Delaware Maine





Alabama Arkansas

Florida Georgia

Kentucky Louisiana



Indiana Iowa

Michigan Minnesota

Missouri Ohio

Wisconsin Kansas

Montana Nebraska


South Dakota Texas

Wyoming Arizona

California Colorado

Nevada New Mexico

Utah Idaho

Oregon Washington

1-in-20 1-in-20

Likely Range

NORT

HEAS

T SO

UTHE

AST

MID

WES

T GR

EAT P

LAIN

S SO

UTHW

EST

NW


Energy Per capita direct costs from changes in energy expenditures in RCP 8.5, 2080-99

-$200 -$100 $0 $100 $200 $300 $400 $500 $600 $700 $800

USA Connecticut

Delaware Maine





Alabama Arkansas

Florida Georgia

Kentucky Louisiana



Indiana Iowa

Michigan Minnesota

Missouri Ohio

Wisconsin Kansas

Montana Nebraska


South Dakota Texas

Wyoming Arizona

California Colorado

Nevada New Mexico

Utah Idaho

Oregon Washington

1-in-20 1-in-20

Likely Range NO

RTHE

AST

SOUT

HEAS

T M

IDW

EST

GREA

T PLA

INS

SOUT

HWES

T NW


Agriculture Per capita costs from changes in yields (maize, wheat, soy, cotton), RCP 8.5, 2080-2099

-$1,000 -$500 $0 $500 $1,000 $1,500 $2,000

USA Connecticut

Delaware Maine





Alabama Arkansas

Florida Georgia

Kentucky Louisiana



Indiana Iowa

Michigan Minnesota

Missouri Ohio

Wisconsin Kansas

Montana Nebraska


South Dakota Texas

Wyoming Arizona

California Colorado

Nevada New Mexico

Utah Idaho

Oregon Washington

1-in-20 1-in-20

Likely Range

NORT

HEAS

T SO

UTHE

AST

MID

WES

T GR

EAT P

LAIN

S SO

UTHW

EST

NW

southeast and caribbean and gulf of mexico climate

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