A study shows that destructive extreme weather events caused by climate change will cost us more than previously estimated. Using the example of tropical cyclones, the researchers illustrate the importance of the long-term effects for affected societies. If the lasting impact on the economy caused by these natural disasters is also taken into account, the current estimate of the global costs of CO₂ emissions increases by more than 20 percent. Conversely, this means that the economic benefits of climate protection measures are still significantly underestimated, say the scientists.
Droughts, floods and violent storms are increasingly affecting many areas of the world: climate change is leading to more and more intense extreme weather events. As is well known, they can cause a lot of human suffering and gigantic economic damage due to their enormous destructive power. Any further increase in temperature, which is primarily linked to the release of carbon dioxide, contributes to the potential threat.
In order to clarify the economic aspect of the connection, assessments of the social costs of CO₂ emissions are already being developed. These are values that are intended to illustrate the financial damage that could result from the emission of an additional ton of CO₂ into the atmosphere. These key figures are often used as a guide when evaluating climate protection efforts. Because they offer a certain possibility of comparing the social costs of climate change with the financial costs for measures to contain it.
More than the acute damage
However, it is difficult to determine how high the follow-up costs actually are, as the effects of climate change and the associated weather extremes are complex. This is exactly what the current study makes clear with a specific aspect: “So far, the long-term effects of extreme weather events have not been taken into account when calculating the social costs of CO₂ emissions, so the current estimates only reflect a portion of the actual costs. This means that the benefits of climate protection measures are greatly underestimated, as the true costs are probably much higher,” says co-author Franziska Piontek from the Potsdam Institute for Climate Impact Research (PIK).
To illustrate the importance of this aspect, scientists chose tropical cyclones as an example. As is well known, these are particularly violent and frequent natural disasters that affect densely populated and economically important regions of the world. The storms can cause devastating damage to buildings and infrastructure – from which society can sometimes only recover slowly. The scientists focused on exactly this aspect in their study: They recorded the long-term negative economic effects of hurricanes that raged in 41 countries between 1981 and 2015. They then combined this information with forecasts under various future economic development and warming scenarios.
Serious follow-up costs
As the team reports, there were some extremely long-lasting after-effects: “Our analysis shows that severe tropical cyclones can slow down a country’s economic development for more than a decade,” says Hazem Krichene from PIK. The bottom line is that this causes enormous economic damage. “With global warming, the proportion of the most severe tropical cyclones will increase. This makes it more likely that affected economies will not be able to fully recover between successive storms,” says Krichene.
The scientists conclude that these long-term consequences can hinder the economic development of affected countries more than the direct damage caused by the hurricanes. Specifically, their calculations based on linking the data with the effect of CO₂ and climate change forecasts showed: The current estimates of the global social costs of CO₂ emissions would have to be increased by more than 20 percent if the long-term consequences of tropical cyclones were to be met be included. As they explain, this increase is primarily due to the foreseeable higher damage caused by these storm disasters in the economies of India, the USA, China, Taiwan and Japan.
Finally, senior author Christian Otto from PIK says: “When it comes to extreme events, the main focus is often on the immediate economic damage. “However, it is equally important to measure the total costs of these events in order to inform society about the true costs of climate change and the climate impacts that can be prevented through ambitious climate protection,” said the scientist.
Source: Potsdam Institute for Climate Impact Research, specialist article: Nature Communications, doi: s41467-023-43114-4