Insurance and Climate Change column

Retreat as an Answer to Climate Change?

By | August 22, 2019

Think retreat is never an option? Think again.

Faced with global warming, rising sea levels, and the climate-related extremes they intensify, the question is no longer whether some communities will retreat—moving people and assets out of harm’s way—but why, where, when, and how they will retreat.”

That’s according to a new research paper on climate change adaption.

The paper published in the journal Science by researchers from universities including Harvard and Stanford is ominously titled, The case for strategic and managed climate retreat.

Since retreat is seen largely as a last resort, or a failure to adapt, little research has focused on retreat, the paper notes.

“We propose a reconceptualization of retreat as a suite of adaptation options that are both strategic and managed,” the paper states. “Strategy integrates retreat into long-term development goals and identifies why retreat should occur and, in doing so, influences where and when.”

The paper also suggests considering the management of how retreat is executed.

“By reconceptualizing retreat as a set of tools used to achieve societal goals, communities and nations gain additional adaptation options and a better chance of choosing the actions most likely to help their communities thrive,” the paper states.

It notes that retreat strategies should be forward-looking and responsive to economic opportunities, market forces, and demographic changes.

A strategy, for example, may consider locations where out-migration is rising, and respond by allocating resources to support displaced households or by building a new levee.

“A proactive strategy may recommend retreat be pursued in at-risk areas the next time those homes are flooded,” the paper states. “Or it might identify path dependencies: steps taken today that promote or limit future options. For example, limits on shoreline armoring could enable future retreat, whereas heavy armoring today is likely to encourage dense development and make future retreat more difficult.?

Homes and Climate

Most home buyers don’t consider the potential impact of climate change on what’s likely to be their biggest investment, but maybe they should.

A report out earlier this month from Clever Real Estate, How Climate Change Will Impact Major Cities Across the U.S., ranks the impact of climate change for different cities based on risk, readiness, and the probability of an extreme climate event.

“The reality is climate change could have a serious impact on how the real estate industry approaches property values and assesses risk,” the report states.

While some regions might have to contend with increased flooding, the report states that others might experience extreme heat waves or cold snaps, so the effect of climate change will vary based on: The type of potential climate-related hazard; the vulnerability of a location to that particular type of hazard; how the location can adapt to that type of hazard (emergency readiness).

The report uses data from Notre Dame Global Adaptation Initiative, which contains more than 500,000 data points for 192 UN countries.

Key findings in the report include:

  • The cities that are most vulnerable to climate change hazards are also the least prepared for them;
  • Coastal cities have higher risk scores relative to inland cities, meaning they are more vulnerable to climate change-related hazards;
  • Extreme heat is more likely to impact cities in Florida and the Midwest because they’re at higher risk of heat waves and are more vulnerable to relative humidity;
  • Floods are more likely to impact cities in California and Texas because they are near large river basins;
  • Eastern and southern coastal cities are more likely to be affected by sea-level rise compared to western coastal cities;
  • Somewhat counter-intuitively, extreme cold is more likely to negatively impact cities in warmer states like Texas and California because they lack the requisite infrastructure.

Among the cities the report shows are at highest risk include Santa Ana, Calif., Miami, Fla., Newark, N.J. and Chicago, Ill.

The cities with the highest degree of readiness include Madison, Wis., Seattle, Wash., Plano, Texas, and Minneapolis, Minn.

Madison ranks as the best-prepared city for extreme climate events in the nation because the city has economic stability to adapt to extreme climate events, and the government system to support these adaptations.

“Furthermore, Madison has civil engagement and innovative capabilities that allow its residents to adjust to a more volatile environment,” the report states.

Resilience People

Florida has a new state official to head climate change preparation.

Gov. Ron DeSantis earlier this month named Julia Nesheiwat as Florida’s first chief resilience officer.

Nesheiwat’s job will be to coordinate a statewide response to climate change.

“Nesheiwat is expected to prepare Florida for environmental, physical and economic challenges,” states an official announcement on the creation of the new position.

She will report to the governor’s office and will work with various state agencies, along with local communities and stakeholders.

Nesheiwat has more than 20 years of experience in renewable energy and environmental issues focused on water and natural resources. She was previously a deputy assistant secretary for energy in the U.S. Department of State, and was a U.S. Army intelligence officer.

Creating government posts to deal with climate change seems to be a thing lately.

California Insurance Commissioner Ricardo Lara in January after he took office named Michael Peterson to the newly created post of deputy commissioner for climate and sustainability, which at the time was hailed as “the nation’s first executive-level position focused on engaging the insurance industry in the fight against climate change.”

Washington Insurance Commissioner Mike Kreidler in August tapped Jay Bruns, formerly head of environmental stewardship for The Hartford, as senior climate policy advisor.

Capitalism and Climate

The fall of capitalism as we know it today may be imminent, according to a recent report by scientists at BIOS, a multidisciplinary research unit launched in Helsinki in 2015.

The report, Global Sustainable Development Report 2019, released last week, argues the era of cheap energy is coming to an end as the world is forced to look to sustainable energy to battle climate change.

It poses the question: What will happen during the oncoming years and decades when we enter the era of energy transition, combined with emission cuts, and start to witness more severe effects of climate change?”

“In addition to rapid climate change, biodiversity loss, and other environmental hazards, societies are witnessing rising inequality, rising unemployment, slow economic growth, rising debt levels, and governments without workable tools for managing their economies,” the report states. “Central banks in the U.S. and the Eurozone have resorted to unconventional measures such as negative interest rates and buying up significant amounts of public debt. This has relieved some economic pressure, but many commentators are worried about what can be done after these extraordinary measures are exhausted and the next economic crisis hits.”

Economies will need to transform the ways in which energy, transport, food, and housing are produced and consumed, according to the report.

The report uses energy, as one example.

It notes that roughly 80% of the global primary energy supply comes from fossil fuels like oil, natural gas and coal.

“Good quality, easily available fossil fuels have powered the industrialization of nations world-wide,” the report states. “Now, the entire energy infrastructure needs to be transformed. The energy return on investment (EROI) decreases across the spectrum – unconventional oils, nuclear and renewables return less energy in generation than conventional oils, whose production has peaked – and societies need to abandon fossil fuels because of their impact on the climate.”

Because renewables have a lower EROI and different technical requirements, such as the need to build energy storage facilities, meeting growing levels of energy need in the next few decades with low-carbon solutions “will be extremely difficult, if not impossible,” the report notes.

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