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The Cost of Climate Change

The Cost of Climate Change
January 4, 2021 Michael Sutton

Introduction 

As the frequency and intensity of extreme weather events increases, so does the damage and the financial burden. According to a recent report, the world’s 10 most expensive climate-related weather disasters in 2020 cost more than $145 billion in uninsured losses[1].

Counting the Cost

The report, released by Christian Aid, examines the 10 most financially devastating climate-related weather disasters of 2020, and highlights five additional disasters that had lower financial losses but were just as devastating. The details of the most expensive disasters in chronological order are presented in Table 1 below[1].cost of climate change

Table 1: Most expensive weather disasters 2020.

It can be seen from the table that all of the climate-related weather disasters cost $1.5 billion or more, with nine of the disasters costing $5 billion or more. Additionally, these figures are based on uninsured losses and are therefore likely to be a highly conservative estimate of their actual cost[2]. 

The press release that accompanies the report also explains that: “While the report focuses on financial costs, which are usually higher in richer countries because they have more valuable property, some extreme weather events in 2020 were devastating in poorer countries, even though the price tag was lower”[2]. This means that, although the financial cost was lower, the impact upon poorer communities was disproportionately greater.

For each of these disasters, the report describes how they were exacerbated by changes in climate conditions and/or extreme weather events in the region. For example, the locust swarms in East Africa, which thrive in wet conditions, followed the floods and cyclones that were very frequent in East Africa in 2019. These floods and cyclones have been linked to changes in the Indian Ocean Dipole (IOD), an ocean circulation pattern that affects the climate in the region[1].

cost of climate change

Figure 1: “Desert locust swarms”, by FAO emergencies, licensed under CC BY 2.0

Finally, the table makes clear the huge effect the weather disasters had on human displacement. Over 17 million people were displaced or advised/forced to evacuate due to these weather disasters, based on the available data. The figure is likely to be much greater than this in reality.

Recommendations

The report finishes with three recommendations to help prevent further disasters and combat the ongoing effects of climate change. The basic principles of each recommendation are:

  • More countries need to put forward ambitious plans to cut greenhouse gas emissions, and their implementation should be made a top priority.
  • Richer countries must support vulnerable communities that disproportionately suffer the consequences of climate change.
  • All governments should invest in energy transition to renewables and support developing countries to leapfrog fossil fuelled development.

The full report can be read here – Counting the cost 2020: A year of climate breakdown.

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References

[1] – Kramer, K. and Ware, J., 2020. Counting The Cost 2020: A Year Of Climate Breakdown. [online] Christianaid.org.uk. Available at: https://www.christianaid.org.uk/sites/default/files/2020-12/Counting%20the%20cost%202020.pdf [Accessed 31 December 2020].

[2] – Christian Aid, 2020. Extreme Weather Driven By Climate Change Cost The World Billions In 2020 – Report – UK Charity Fighting Global Poverty | Christian Aid | Mediacentre. [online] UK charity fighting global poverty | Christian Aid | Mediacentre. Available at: https://mediacentre.christianaid.org.uk/extreme-weather-driven-by-climate-change-cost-the-world-billions-in-2020-report/ [Accessed 31 December 2020].

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