Economic costs and impacts of climate-induced sea-level rise and storm surge in Canadian coastal provinces: a CGE approach

Abstract

We estimated the economic costs and impacts of future sea-level rise (SLR) and storm surge due to climate change in Canada's coastal provinces using regional, dynamic computable general equilibrium models that track provincial welfare, GDP, trade, prices and inputs over the 2009-2054 period. We also assessed the economic costs of coastal adaptation investments, to determine whether such investments can be justified on economic grounds. Results indicated that SLR and storm surge could cost Canada in the range of $4.6-$25.5 billion in present value welfare, and between $53.7 and $108.7 billion in present value GDP. We found significant variation in costs and impacts across coastal provinces, with some provinces such as Newfoundland and Labrador experiencing only marginal costs/impacts, and others such as British Columbia experiencing costs as high as $21 billion in welfare over the period. Coastal adaptation investments were supported on economics grounds. Overall, this study provides the first (and preliminary) provincial economic impact estimates of climate-induced SLR and storm surge, as well as adaptation investments, in Canada. Additional research is needed to refine the analysis in order to produce reliable estimates that can be used to guide coastal adaptation policies in Canada.

Synthesizing and communicating climate change impacts to inform coastal adaptation planning

“…Further adaptation examples can be found in urban areas near the Fraser River floodplain, an area that is highly vulnerable to sea level rise due to low-lying geology and dense population (Yumagulova and Vertinsky 2017). A recent analysis found that the costs of sea level related damage to on-shore built infrastructure would be higher in coastal BC than any other coastal region in Canada (Withey et al 2016). Regional models of sea level rise and seasonal climatic variability patterns would improve the ability of coastal managers to predict flood hazards and associated risk factors for the region.…”

Northern Shelf Bioregion Climate Change Assessment: Projected climate changes, sectoral impacts, and recommendations for adaptation strategies across the Canadian North Pacific Coast

“…A recent analysis found that the costs of sea level related damage to on-shore built infrastructure would be higher in coastal BC than any other coastal region in Canada [108].…”

Climate change adaptation based on computable general equilibrium models – a systematic review

“…The examined investments and funding for adaptation include agricultural sector investments (Arndt et al, 2015(Arndt et al, , 2011Bosello et al, 2018;Calzadilla et al, 2013Calzadilla et al, , 2014Elshennawy et al, 2016;Robinson et al, 2012;Zidouemba, 2017), funding of adaptation in developing regions (Ouraich and Tyner, 2018;Schenker and Stephan, 2014), coastal protection investments (Elshennawy et al, 2016;Parrado et al, 2020;Withey et al, 2016), decrease in investments in risky areas (Husby et al, 2016), utilization of insurance and catastrophic bonds (Thirawat et al, 2017), public investments in adaptation (Bachner et al, 2019;Hirte et al, 2018;Hoffmann, 2019;Hoffmann and Stephan, 2018) and adaptation measure of an artificial beach enhancement (Nakajima et al, 2020).…”