New research finds that taking into account the long-term effects of tropical cyclones, the global social cost of carbon increases by more than 20%. The increase comes as the damage to major economies from global warming is expected to increase. The study highlights that current estimates underestimate the true costs of climate change by ignoring these long-term economic impacts.
Extreme events such as tropical cyclones not only have direct impacts but also have long-term impacts on society. A new study published in the journal Nature Communications finds that accounting for the long-term effects of these storms would increase the global social cost of carbon by more than 20% compared to current estimates used in policy assessments. This increase is mainly due to the expected increase in damage caused by tropical cyclones to major economies such as India, the United States, China, Taiwan and Japan under global warming.
The analysis shows: "Intense tropical cyclones can slow down a country's economic development by more than a decade. As the world warms, the proportion of the most intense tropical cyclones is expected to increase, making it more likely that the economy will not fully recover between storms," explains Hazem Krichene, a scientist at the Potsdam Institute for Climate Impact Research (PIK) and author of the study. That’s why long-term impacts, such as reduced economic growth from tropical cyclones, can harm economic development even more than the direct economic losses caused by the storm.
The so-called "Social Cost of Carbon" (Social Cost of Carbon) refers to the dollar estimate of the future social cost caused by emitting one more ton of carbon dioxide into the atmosphere. This key metric is widely used in policy assessments because it allows comparison of the costs of climate change to society with the costs of climate mitigation measures.
"However, the long-term effects of extreme events have so far not been taken into account, so current estimates of the social carbon cost only reflect a part of the actual costs. This means that the actual costs are likely to be higher than currently estimated, and the benefits of climate mitigation measures are therefore underestimated," said co-author Franziska Piontek from PIK.
Hotter climate, stronger tropical cyclones, higher costs
In the study, the scientists analyzed the economic losses caused by these storms in 41 tropical cyclone-prone countries between 1981 and 2015 and made predictions based on future global warming. Unlike previous studies, they took into account the long-term negative impact of these storms on economic development. The researchers found that these impacts increase the social cost of carbon by more than 20% globally (from $173 to $212 per ton of carbon dioxide) and by more than 40% in the countries analyzed that are vulnerable to tropical cyclones, compared with current estimates of the social cost of carbon used in policy assessments.
"When it comes to extreme events, people focus more on the direct economic losses. However, it is also crucial to better quantify the overall costs of these events, so that society understands the real costs of climate change and the climate impacts that can be avoided through effective climate action," concluded study author Christian Otto of PIK.