Adaptation Lowers The Estimated Economic Cost Of Sea-Level Rise

June 02, 1998

CHAMPAIGN, Ill.-- By combining three separate models -- an emissions model, a simple climate/ocean model and an economic-impacts model -- researchers have concluded that adaptation lowers the cost of sea-level rise caused by global warming.

"Our approach represents a methodological improvement in linking emissions, driven by representative views of the pace of economic activity, with a careful consideration of their downstream cost," said Michael Schlesinger, an atmospheric scientist at the University of Illinois.

In a paper published in the April issue of Climatic Change, Schlesinger and colleague Gary Yohe, a professor of economics at Wesleyan University, linked three models to calculate the economic cost of damage to properties along the U.S. coastline.

First, an emissions model based upon projected future global economic activity was used to determine the concentration of carbon dioxide and other greenhouse gases, and the emission of sulfur dioxide. Next, a simple climate/ocean model calculated the change of global-mean temperature and the resulting sea-level rise caused by thermal expansion of the ocean, and changes in small glaciers and large ice sheets. Third, an impacts model estimated the economic cost derived from developed properties in a way that incorporated the potential of adapting efficiently to the threat of rising seas.

In particular, market-driven depreciation -- an adaptation -- was included in the potential cost of abandoning property. In deciding whether to retreat by abandonment or to protect by building sea-walls or nourishing beaches -- other forms of adaptation -- the potential costs were compared for a large sample of 500-meter lengths of coastline.

A total of 280 plausible future scenarios -- each dependent upon greenhouse-gas emissions, climate sensitivity and sulfur dioxide emissions -- were run through the economic-impacts model, Schlesinger said. The resulting cost estimates reflect different rises in sea level through the year 2100.

"For example, if a 50-centimeter rise in sea level were anticipated through the turn of the next century, then $61 million, $110 million and $222 million in cost could be expected in the years 2010, 2050 and 2100, respectively," Yohe said. "Those costs should be expected to climb to $158 million, $284 million and $571 million per year, respectively, if the anticipated sea-level rise through the year 2100 turned out to be 90 centimeters instead of 50 centimeters."

The researchers' findings underscore the notion that adaptation will limit the annual economic costs caused by sea-level rise to amounts that will not, in the aggregate, be significant.

"There will be distributional effects; and there will be individuals who will suffer economic losses that, to them, are significant," Yohe said. "But the calculus of cost-benefit analysis works on the net effect, and the cost of protection puts a cap on our economic vulnerability."

Other outstanding issues, Schlesinger said, include the effects of storms, and banking and insurance company liability in the face of climate variability given higher seas.
-end-


University of Illinois at Urbana-Champaign

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