IPCC_Managing Risks of Extreme Events.pdf - Climate Access

Changes in Impacts of Climate Extremes: Human Systems and EcosystemsChapter 4Table 4-5 | Range of regionalized annual costs of adaptation for wet and dry scenarios (in 2005 US$ billion). Reflecting the full range of estimated costs, the wet scenario costsdo not include benefits from climate change while the dry scenario costs include benefits from climate change within and across countries. Source: World Bank, 2010.Scenario/RegionEast Asia &PacificEurope &Central AsiaLatin America &CaribbeanMiddle East &North AmericaSouth Asiasub-SaharanAfricaTotalWet 25.7 12.6 21.3 3.6 17.1 17.1 97.5Dry 17.7 6.5 14.5 2.4 14.6 13.8 69.6in the study, which were a scenario with the most precipitation (‘wet’)and one with the least precipitation (‘dry’) among all scenarios chosenfor the study, which employ socioeconomic driver information fromIPCC’s SRES A2 scenario (see Table 4-5).Taking Africa as an example, based on various estimates the potentialadditional costs of adaptation investment range from US$ 3 to 10 billionper year by 2030 (UNFCCC, 2007; PACJA, 2009). However, this could bealso an underestimate considering the desirability of improving Africa’sresilience to climate extremes as well as the flows of internationalhumanitarian aid in the aftermath of disasters.4.5.6. Uncertainty in Assessing theEconomic Costs of Extremes and DisastersUpon reviewing the estimates to date, the costing of weather- andclimate-related disasters and estimating adaptation costs is stillpreliminary, incomplete, and subject to a number of assumptions withthe result that there is considerable uncertainty (Agrawala andFankhauser, 2008; Parry et al., 2009). This is largely due to modelinguncertainties in climate change and damage estimates, limited dataavailability, and methodological shortcomings in analyzing disasterdamage statistics. Such costing is further limited by the interactionbetween numerous adaptation options and assumptions about futureexposure and vulnerabilities, social preferences, and technology, as wellas levels of resilience in specific societies. Additionally the followingchallenges can be identified.Risk assessment methods: Technical challenges remain in developingrobust risk assessment and damage costing methods. Study results canvary significantly between top-down and bottom-up approaches. Riskbasedapproaches are utilized for assessing and projecting disaster risk(Jones, 2004; Carter et al., 2007), for which input from both climate andsocial scenarios is required. All climatic phenomena are subject to thelimitation that historically based relationships between damages anddisasters cannot be used with confidence to deduce future risk ofextreme events under changing characteristics of frequency and intensity(UNDP, 2004). Yet climate models are today challenged when reproducingspatially explicit climate extremes, due to coarse resolution and physicalunderstanding of the relevant process, as well as challenges in modelinglow-probability, high-impact events (see Section 3.2.3). Therefore,projections of future extreme event risk involve uncertainties that canlimit understanding of sudden onset risk, such as flood risk. Futuresocioeconomic development is also inherently uncertain. A uniform setof assumptions can help to provide a coherent global picture andcomparison and extrapolation between regions.Data availability and consistency: Lack of data and robust informationincreases the uncertainty of costing when scaling up to global levels froma very limited (and often very local) evidence base. There are doublecountingproblems and issues of incompatibility between types ofimpacts in the process of multi-sectoral and cross-scale analyses,especially for the efforts to add both market and non-market values (e.g.,ecosystem services) (Downton and Pielke Jr., 2005; Pielke Jr. et al., 2008;Parry et al., 2009). Moreover the full impacts of weather- and climaterelatedextremes in developing countries are not fully understood, anda lack of comprehensive studies on damage, adaptation, and residualcosts indicates that the full costs are underestimated.Information on future vulnerability: Apart from climate change,vulnerability and exposure will also change over time, and theinteraction of these aspects should be considered (see, e.g., Hallegatte,2008; Hochrainer and Mechler, 2011). This has been recognized andassessments of climate change impacts, vulnerability, and risk arechanging in focus, leading to more integration across questions. Whileinitial studies focused on an analysis of the problem, the field proceededto assess potential impacts and risks, and now more recently started tocombine such assessments with the consideration of specific riskmanagement methods (Carter et al., 2007).Some studies have suggested incorporating an analysis of the ongoingor chronic economic impact of disasters into the adaptation planningprocess (Freeman, 2000). A fuller assessment of disaster cost at varyingspatial and temporal scales and costs related to impacts on human,social, built, and natural capital, and their associated services at differentlevels can set the stage for comparisons of post-disaster developmentstrategies. This would make disaster risk reduction planning andpreparedness investment more cost-effective (Gaddis et al., 2007). Forexample, there is consensus on the important role of ecosystems in riskreduction and well-being, which would make the value of ecosystemservices an integral part of key policy decisions associated with adaptation(Tallis and Kareiva, 2006; Costanza and Farley, 2007).274