Flooding presents £12bn climate change risk
The damage caused by more frequent and heavier floods could cost the UK economy £12 billion by 2080, warns Defra
In the government's first assessment of the risks posed to the UK economy by climate change, Defra reveals that a failure to adapt to hotter summers, more frequent floods and restricted access to water could cost billions of pounds in the coming decades.
The UK Climate Change Risk Assessment (CCRA) examines in detail 100 potential impacts of climate change and concludes that flooding poses the greatest risk to infrastructure, homes and businesses, with the cost of damage likely to at least double from today’s annual costs of £1.2 billion, and potentially reaching £12 billion by 2080.
According to the CCRA, the number of non-domestic buildings likely to be at risk of flooding could potentially double 2008 figures to 400,000 by 2080, with expected annual costs for flood-related damage rising from £500 million to approximately £1.6-£2.5 billion.
Alongside increased business costs related to disruption of supply chains and productivity from floods, the CCRA reveals significant threats posed by temperature rises with the number of working days lost to overheating expected to at least double by 2050, and predicted to rise by as much as 20 times.
Without the adoption of energy-efficient measures to cool buildings, the CCRA estimates that by 2080 the costs to business from overheating could be as much as twice the costs associated with flooding and access to water, growing from around £770 million today to £3.6 billion, and possibly reaching as high as £15.2 billion. Such figures would represent between 0.02% to 0.1% of UK businesses’ total turnover.
The diversity in potential costs reveals the difficulties in predicting accurately the financial impacts of climate change and Defra’s figures do not take into account any planned or future adaptation measures. However, the CCRA reinforces the message that businesses must prepare for the impacts of climate change, says Lord John Krebs, chair of the adaptation subcommittee of the Committee on Climate Change.
“Without an effective plan to prepare for the risks from climate change the country may sleepwalk into disaster,” he warned. “This report represents an important first step in the process and demonstrates why the UK needs to take action to adapt now… By taking steps to manage these risks, the UK can reduce the costs of climate change in the future.”
Welcoming the report, Martin Baxter executive director of policy at IEMA highlighted the important role of environmental professionals in guiding their organisations to effective adaptation.
"Setting out the risks to society and the economy from a changing climate, the CCRA underlines the importance of taking a long-term approach,” he said. “However, too few businesses and public sector organisations are reflecting climate risks in their decision-making processes.
“There is an urgent need for action to be taken now to build knowledge and skills to improve business resilience. Environmental practitioners are well placed to help organisations understand climate risks and build adaptive capability.”
The CCRA also highlights possible positive outcomes of a changing climate for the UK including a reduction in premature deaths from cold of between 3,900 and 24,000, as well as potential new market opportunities for the finance sector in insurance, tourism from better weather conditions and agriculture with ability to grow new crops. It also argues that melting arctic ice could create better trade links with Asia.
The publication of the report was accompanied by the announcement of the government’s development of a national adaptation programme (NAP). The completed NAP, as required by the Climate Change Act 2008, will be published in 2013 and outline actions the government will take to ensure England is prepared for the impacts of climate change in future.
In announcing the NAP, Caroline Spelman called for opinions on what should be the government’s priorities for adaptation under its five key themes – the natural environment, buildings and infrastructure, health and wellbeing, business and services, and agriculture and forestry.