Asssessing the costs of adaptation to climate change: a review of the UNFCCC and other recent estimates

A re-assessment of the UNFCCC adaptation for climate change estimates for 2030 suggests that they are likely to be substantial under-estimates.The purpose of this report is to illustrate the uncertainties in these estimates rather than to develop new cost estimates, which is a much larger task than can be accomplished here.

The main reasons for under-estimation are that:

1. some sectors have not been included in an assessment of cost (e.g. ecosystems, energy, manufacturing, retailing, and tourism)
2. some of those sectors which have been included have been only partially covered
3. the additional costs of adaptation have sometimes been calculated as ‘climate mark-ups’ against low levels of assumed investment.

• the potential damages to be avoided by adaptation
• the scarcity of information on adaptation and its cost
• applying a 'climate mark-up' against future investment trends
• investment needed to remove the 'adaptation deficit'
• adaptation costs in a world without an 'adaptation deficit'
• how much impact is being avoided by adaptation?
• the costs of damage not adapted to or 'residual damage'
• how will adaptation costs change over time?

• it is important that robust studies of adaptation cost are, in future, based upon case studies that cover a wide range of places and sectors, and support top-down analyses of the kind evaluated here
• the time period and expected climate changes need specifying (as they were in the UNFCCC study), and results for multiple timeframes would be useful
• non-climate trends need careful portrayal, especially the future levels of non-climate investment
• costs of adapting to varying amounts of impact should be analysed, thus providing a choice range for preparedness to pay
• there needs to be some analysis of the residual impact that adaptation is not likely to avoid, and the resulting damage costs that we need to anticipate.