Will we be able to afford to adapt to climate change?

According to the experts we have locked in irreversible climate change for the next 20 or so years, even if we switch off all our activities which produce carbon.  I’m worried that we won’t be able to afford the full costs of adapting to climate change.

The kinds the effects we are looking at include increased rainfall in some areas, decreased rainfall in others, stronger storms or cyclones, rising sea levels, increased temperatures, and so on.

From a practical point of view this means that we will do things like:

• Improve storm water drainage systems
• Put in sea walls where a lot of property could be affected by sea rise and tidal surges due to cyclones.
• Put in more dams to catch rain.
• Install seawater treatment plants to create freshwater for our cities and farms.
• Put in cheap air conditioning so people don’t get too distressed from the heat and can work productively. This is especially important for the elderly and the very young who can’t regulate their body temperature very well.
• Upgrade the electricity network to deal with the increased electrification of our lives (e.g. electric cars) as well as running the extra air conditioning.
• Move sewerage treatment sites to higher ground where sea level rises will be an issue.
• Move critical infrastructure to higher ground or build bunding where sea level rises will be an issue.
• And so on.

The thing all these actions have in common is that they involve a lot of energy usage. E.g. Cement, steel, fuel for equipment, etc. All these items are energy intensive and will be increasingly more expensive due to carbon taxes.

So, here is my question to you all – given that we have introduced a carbon tax to reduce carbon emissions, how can we sensibly adapt to climate change given that the carbon tax is increasing the costs to the inputs of adapting to climate change?

This is especially serious for Australia as we already have some of the most expensive construction costs in the world and we are deliberately going through a process of putting prices up.  Shouldn’t we consider affordability too? 

This is, after all, the other side of the equation.

Note: I work as a project and energy economist with companies and governments on geosequestration,wind, geothermal, hydro, wave, transmission networks, coal seam gas, coal,and more. The views expressed in this blog are solely my own and do not represent the views of any organisation that I do work for.

What about my grandmother?

Society is complex.

One of the calls to action on climate change is the emotive statement ,“But what about my grandchildren’s future?”

Fair point and I don’t argue that at all. We should be acting today to help  leave the world better for our grandkids.

But when it comes to the design of mitigation I think it is only fair to ask, “but what about my grandmother.”

Society’s ability to pay for solutions varies.

• Parents pay for their children until they have an income.
• Young adults generally speaking have more disposable income than couples with children.
• Younger people have an ability to earn more in the future to cover any losses.
• Older people have little if no ability to earn more money – so any loss is permanent.
• Better off people can afford to pay for more expensive solutions such as solar, and in industry this is referred to as being an analogue to the model for organic food. I.e. those who can afford it and care can take that option.

And so on. It is complex.

A carbon tax is elegantly simple in theory, but the real world issues will be complex as not everyone has the ability to adjust.

To bring our grandmothers back into the picture we need to think about what will happen after 2 or three years into the carbon tax regime when carbon credits will be bought on the open market and prices could conceivably go up, with less tax coming to the government to be able to subsidise our elderly.

We can’t model this right now, and the government of the day has put in a lot of wriggle room for their future actions.

My former elderly neighbours are my inspiration. They saved and scrimped their whole lives for their retirement. Inflation ran away in the 2000’s and their cost of living went up – and they suffered with stoic dignity. They had an air conditioner but could only afford to put it on for an hour or two on the very hottest days in Summer (remember that the elderly are more likely to die in a heat wave than other parts of society.) They couldn’t afford to buy a more energy efficient air conditioner, or even a more energy efficient fridge.

So, think about your grandparents as well as your grandkids when you come up with solutions.

Note: I work as a project and energy economist with companies and governments on geosequestration,wind, geothermal, hydro, wave, transmission networks, coal seam gas, coal,and more. The views expressed in this blog are solely my own and do not represent the views of any organisation that I do work for.