In a number of recent studies, the costs of adaptation to climate change have been calculated with comparable ranges of estimation, thus suggesting that the last UNFCCC estimates are as well quite robust (49-171 Billion US $ per year in present-day values). 

A recent report published by IIED shows however that the UNFCCC numbers may have been substantially under-estimated for several reasons:

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

Yet, the purpose of this report is not to develop new estimates, but rather to point out the strengths and weaknesses of the UNFCCC study. 

The IIED report starts with the needed background information, reviewing the ranges of main global estimates produced so far. Then, a chapter is dedicated to adaptation costs uncertainties in each sector: Agriculture, forestry and fisheries, Water supply, Human health, Coastal zones, Infrastructure, and Ecosystems. 

Besides the three main points highlighted above, the report insists on the fact that adaptation is strictly related to the development of the poorest countries and there may be a substantial deficit in the programmed investments, and the related adaptation costs. ODA should then probably rise up till 0.7% of the GDP of OECD countries. 

Another important limitation of the UNFCCC study is that most impacts are projected to increase non-linearly with climate change, and adaptation costs similarly with impacts. Therefore it will probably be very inexpensive to avoid some impacts but prohibitively expensive to avoid others, as shown in the figure aside. An implication of the above is that there will be substantial residual damage, and the UNFCCC report is not very clear about the magnitude of such damages. It is as well of the most importance to correctly estimate the change of adaptation costs over time, especially after 2030. 

All considered, the IIED report states that the current UNFCC estimation may be underestimated by a factor between 2 and 3 for the included sectors, while it could be much more for the other sectors.

Read more

• A brief review and presentation of this report is available on the IIED website.
• Download the IIED report “Assessing the costs of adaptation to climate change – A review of the UNFCCC and other recent estimates” by Martin Parry et al. [pdf -2MB]
• Dowload a recent report on adaptation in the Mediterranean published by IDDRI “The future of the Mediterranean – From impacts of climate change to adaptation”  [pdf -1.5MB]
• From the CMCC blog, an article on adaptation to climate change in Italy: “Climate change, how much will it cost to Italy?“