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Ready to pay for the costs of climate change?

By Shira Jeczmien

Nov 29, 2018

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There is something I don’t quite understand about the current U.S. administration, and that is both its love of keeping money at the top and at the same time die hard denial of climate change. Because it doesn’t take more than a moment of thought to connect the dots between a shifting, unpredictable and destructive climate and economic loss. So the question is, is the denial of the energy sector’s grave consequence on our planet in order to keep hands in honey pots worth the long term costs?

A graph in the latest U.S. National Climate Assessment report released by a body of several federal agencies indicates that by 2090 (which granted is a little into the future but not a distant enough future that we shouldn’t be worried), economic damages from climate change will cost the U.S. economy alone $700 billion. You might be imagining hurricanes, tsunamis, wildfires and coastal habitation under water, but the report shows that the heaviest costs from climate change will be in areas much less expected.

The largest portion of the country’s projected spending will be on lost labour costs. As outlined in the report, “almost two billion labor hours are projected to be lost annually by 2090 from the impacts of temperature extremes, costing an estimated $160 billion in lost wages”. The second biggest cost is set to be a result of ‘extreme temperature mortality’. When temperatures rise to levels higher than 35 to 40 degrees Celsius, the risk of fatal heat exhaustion and heat strokes rises exponentially, affecting children and the elderly in particular. In other words, premature deaths as a result of sweltering heat are set to cost $141 billion per year in medical aid in just 50 years from now.

What’s truly interesting about the report is how it is calculated. When it comes to projected costs of future lives lost, the term used by government agencies such as the Environmental Protection Agency (EPA) and others like it is “value of a statistic life”. This is a future life, something that is both difficult to fathom and even harder to feel compassion for. And so, as Brian O’Neill, director of research at the University of Denver’s Pardee Center for International Futures, told the MIT Technology Review, “It’s a measure of how much we’re willing to spend to reduce the risk of a death.” In that case, this is less about the destruction of our planet and more about facing the decision today of how much a statistical future life is worth to us.

The thing is, investing in renewable energy today and divesting from the reliance on coal and oil is actually a lucrative step forward. In fact, the clean energy industry was already estimated to be worth $200 billion in the U.S. alone in 2016, with that figure only projected to spike as technology advances and as global powerhouses such as India are heavily investing in cleaning up their energy production. Following its heavy divestment from fossil fuels over the past few years, India is now expected to overtake China by 2020 (who has thus far been leading investment in renewable energy).

Evidently, the paradox of climate change keeps growing. If a realistic projection of a dying world was not enough to make the U.S. government take an actual change of directions in the ways it produces its energy, then we should at least hope that the economic loss of these monumental figures could influence short-sighted politicians to take the right choice. If anything, at least in the interest of their own pockets.