Climate Change Will Cause Shipping Delays, Higher Insurance Losses, Report Says

Climate Change Will Cause Shipping Delays, Higher Insurance Losses, Report Says

While some have trouble imagining what the worst impacts of climate change will look like, the effects are apparent today and projected to get dramatically worse if nothing is done to rein in greenhouse gas emissions. For the business community, this could mean shipping delays, more insured losses, constrained energy supplies and a decline in some tourism-based activities.

That’s one of many conclusions of a wide ranging assessment released Tuesday by the U.S. Global Change Research Program, a group of government agency experts and academia that produced “Global Climate Change Impacts in the United States.” It updates a 2000 assessment, and though many of its conclusions mirror those of previous research, the new report also breaks down its analysis by sector and region.

The report is stark and straightforward: Man is causing climate change, largely from the burning of fossil fuels. Heat waves will grow more intense and frequent, while heavier downpours and rising sea levels will cause flooding and damage crops or infrastructure in some regions. Other areas will suffer from water scarcity and less runoff.

It lays out a range of possible outcomes based on three scenarios: lower emissions, medium emissions and higher emissions. Although the latter scenarios are grim, the report also sounds a note of optimism because making emissions cuts now will more effectively reduce climate change than reducing emissions later.

“By comparing impacts that are projected to result from higher versus lower emissions of heat-trapping gasses, our report underscores the importance and real economic value of reducing those emissions,” Tom Karl, a report co-chair and director of NOAA’s National Climatic Data Center in Asheville, N.C. , said in a statement. “It shows that the choices made now will have far-reaching consequences.”  

Here are some of the ways in which climate change will impact various business sectors:
Insurance: The industry is particularly vulnerable to climate change impacts, such as damage to property, crops, infrastructure, loss of life, and supply chain disruptions from weather events. Weather-related losses have been steadily increasing, driving up the price of insurance and forcing some to rely on state-mandated insurance pools because premiums are no longer affordable.

Agriculture: Climate change will impact agriculture in good and bad ways. Some crops in California, for example, such as wine and table grapes, almonds, oranges, walnuts and avocados, could see production fall as much as 40 percent in a higher emissions scenario; the impacts in a lower emissions scenario, however, may be negligible. Livestock productivity will likely take a hit from more heat, disease and extreme weather. Warm weather crops such as sweet potato and okra may do well with a longer, hotter growing season. Others will suffer from rising temperatures, such as corn, wheat and rice. Too much or too little water also impacts crops.

Energy: Warmer temperatures mean fewer heating days and more cooling days, leading to a net increase in energy demand. But power generation will also be impacted by water supplies in some regions; precipitation and river discharge will impact hydropower generation, while other types of energy, especially fossil fuel-based generation, require water for cooling. Sea level rise and extreme weather events also threaten energy infrastructure.

Transportation: Airports and airlines may lose money from warmer temperatures and canceled flights. Hotter air is less dense and reduces airplanes’ lift, especially in regions with high altitudes, so planes will need higher take-off speeds and longer runways. Extreme weather and rising sea levels will impact the transportation infrastructure on which the U.S. economy depends, as well as cause delays in air, rail and road transport.

Tourism and Recreation: Shorter snow seasons and end-of-season snowpacks that are between 40 percent and 90 percent smaller will impact ski resorts, forcing some to shut down. The winter snow season may be reduced to a few weeks in some regions of the Northeast. Hunting and fishing in some areas will decline as species migrate.

The Union of Concerned Scientists has compiled several fact sheets of the report's findings, which contributed to this summary.

Image CC licensed by Flickr user timsamoff.