California Must Prepare for Financial Fallout as Cost of Climate Emergency Threatens to Drain Budgets
SACRAMENTO – As the Bobcat Fire in L.A. County grew to more than 114,000 acres, serving as another stark reminder of the worsening climate crisis, SB 1320 by Senator Henry Stern (D-Los Angeles) was signed into law. The bill aims to put a comprehensive price tag on California’s climate liabilities and serve as a financial reminder of why this crisis needs to be addressed now.
“Science does know. Just look around. This is a climate emergency,” said Stern, the chairman of the Senate Natural Resources & Water Committee. “Every corner of the state is or has been on fire in the past two months and we’re living through five of the six largest fires in the state’s history right now. Climate change is not just an environmental crisis, it is an emergency that touches everyone, is destroying lives and property, and is costing Californians billions of dollars a year, effectively putting us on the path to bankruptcy.”
SB 1320 (Stern) directs the Governor’s Office of Planning and Research (OPR) to conduct a California-specific climate change assessment to determine the costs and risks faced by Californians if the state fails to address the climate emergency.
“The costs are going to keep going up the longer people sit on their hands,” continued Stern. “This is an attempt to get a better handle on what those costs are and what precisely is driving them, so in turn we can figure out where we’re going to get the most bang for our buck in terms of investing taxpayer dollars to start addressing this emergency.”
The National Oceanic and Atmospheric Administration estimates as of July 2020, the U.S. has experienced, 79 billion-dollars of weather and climate disasters since 2015, incurring over $553 billion in costs. California witnessed 10 of these billion-dollar disasters during that same period, potentially incurring up to $100 billion in costs. Wildfire accounted for half of these events and potentially up to half of the costs, with drought the other leading driver of costs in the state.
Other initial research suggests that by midcentury, inundation of residential and commercial buildings in California from sea-level rise could generate $17.9 billion in damages and a 100-year coastal food, on top of this level of sea-level rise, would almost double the costs. Extreme heat, caused by climate change in California could also cause $50-$85 billion in costs per year by midcentury. Subsequent research is even bleaker, with a recent study finding the climate inaction will result in upwards of $550 trillion by the end of the century, globally.
Hand-in-hand with the effort in SB 1320, Governor Newsom released the California Climate Investment Framework late Thursday, which will establishes an investment plan as the state prepares for the financial risk of climate change. This framework re-affirms California’s effort to reduce greenhouse gas emissions and takes strides towards carbon neutrality by balancing the need for climate-conscious investment.
SB 1320 was supported by the California Environmental Justice Alliance, the California League of Conservation Voters, Climate Resolve, the Clean Power Campaign, Environment California, E2 (Environmental Entrepreneurs), the Natural Resource Defense Council, and the Sierra Club, the bill passed the Assembly on a 60-11 vote and the Senate on a bi-partisan 3 3-5 vote. The bill takes effect on January 1st, 2021.
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