Climate change effects could cost investors $4 trillion in assets, report warns

Maria Galluci in the International Business Times: Private investors risk losing more than $4 trillion in assets due to the devastating effects of climate change. Rising sea levels, intense flooding and more severe storms threaten to wipe out or diminish portfolios due to property damage, weaker growth and lower asset returns, the Economist Intelligence Unit said in a report Friday.

Assets at stake amount to roughly one-fourth of U.S. gross domestic product. The number could swell to nearly $14 trillion if the Earth’s temperatures warm by a staggering 6 degrees Celsius (10.8 degrees Fahrenheit) compared to the pre-industrial era. From the public-sector perspective, extreme warming represents value losses of $43 trillion, or 30 percent of the entire stock of the world’s manageable assets, the report said.

“Institutional investors need to assess their climate-related risks and take steps to mitigate them; very few have begun to do this,” the report said.

Climate scientists say the world is on track to warm by at least 2 degrees Celsius (3.2 degrees Fahrenheit) by 2050 if countries don’t take dramatic steps to reduce greenhouse gas emissions from power plants, tailpipes and buildings. Even lesser degrees of warming will have dire consequences for the world’s food supplies, coastal communities and human health....

2008 flooding from Hurricane Ike in Key West, Florida, National Guard photo

Cost of climate change not just environmental, expert says

Patricia Doxsey in the Daily Freeman (New York): Eban Goodstein, an economist and climate expert at Bard College in Annandale-on Hudson, says the cost of climate change could rise to as much as $7.5 trillion over the next 40 years. As an economist and climate expert at Bard College, Eban Goodstein looks at global warming from a dollars-and-cents perspective, and what he sees, he says, is staggering.

This year, the cost of global warming worldwide could be as high as $371 billion, he said. And over the next 40 years, the cost could rise as high as $7.5 trillion, said Goodstein, director of the Center for Environmental Policy at Bard, in Annandale-on-Hudson. Those findings were detailed in a report, “An Initial Estimate of the Cost of Lost Climate Regulation Services Due to Changes in the Arctic Cryosphere,” co-authored by Goodstein and released on Feb. 5, the day G-7 finance ministers began meeting to discuss the global economy.

That the Arctic ice caps are melting is significant, Goodstein said, because the Arctic acts as the Earth’s air conditioner. As the white ice melts, it no longer can reflect the suns rays, which instead are absorbed by the dark grounds and water. That, in turn, raises the planet’s temperature. “Right now,” Goodstein said, “the breakdown of the Arctic is contributing as much to global warming as 500 coal-fired power plants.”

Goodstein said understanding the monetary value of the Arctic ice cap can help shed light on the need to address what he says is the most significant challenge ever faced by humankind. The high price tag being placed on global warming, he said, is the result of the loss of agriculture and property stemming from rising sea temperatures and sea levels that will affect both crops and land, as well as the cost of responding to diseases that could follow….

The Jakobshavn/Ilulissat Glacier on the western coast of Greenland, a World Heritage site, from NASA