NEW YORK -- Annual property losses from hurricanes and other coastal storms of $35 billion; a decline in crop yields of 14 percent, costing corn and wheat farmers tens of billions of dollars; heat wave-driven demand for electricity costing utility customers up to $12 billion a year.
These are among the economic costs that climate change is expected to exact in the United States over the next 25 years, according to a bipartisan report released Tuesday. And that's just for starters: The price tag could soar to hundreds of billions by 2100.
Commissioned by a group chaired by former New York City Mayor Michael Bloomberg, former Secretary of the Treasury and Goldman Sachs (GS) alum Henry Paulson, and environmentalist and financier Tom Steyer, the analysis "is the most detailed ever of the potential economic effects of climate change on the U.S.," said climatologist Michael Oppenheimer of Princeton University.
The report lands three weeks after President Barack Obama ordered U.S. regulators to take their strongest steps ever to reduce greenhouse gas emissions, including requiring power plants to cut carbon dioxide emissions to 30 percent below 2005 levels by 2030.
It paints a grim picture of economic loss. "Our economy is vulnerable to an overwhelming number of risks from climate change," Paulson said in a statement, including from sea-level rise and from heat waves that will cause deaths, reduce labor productivity and strain power grids.
By mid-century, $66 billion to $106 billion worth of coastal property will likely be below sea level. There is a 5 percent chance that by 2100 the losses will reach $700 billion, with average annual losses from rising oceans of $42 billion to $108 billion along the Eastern Seaboard and Gulf of Mexico.
Extreme heat, especially in the Southwest, Southeast and upper Midwest, will slash labor productivity as people are unable to work outdoors at construction and other jobs for sustained periods. The analysis goes further than previous work, said Princeton's Oppenheimer, by identifying places that will be "unsuited for outdoor activity."
Demand for electricity will surge as people need air conditioning just to survive, straining generation and transmission capacity. That will likely require the construction of up to 95 gigawatts of generation capacity over the next 5 to 25 years, or roughly 200 average-size coal or natural gas power plants.
As utilities add the construction costs to customers' bills, people and businesses will pay $8.5 billion to $30 billion more every year by the middle of the century.
The report doesn't make policy prescriptions, concluding only that "it is time for all American business leaders and investors to get in the game and rise to the challenge of addressing climate change."