Estimating Future Costs for Alaska Public Infrastructure at Risk from Climate Change
The Institute of Social and Economic Research (ISER) at the University of Alaska Anchorage created a model to estimate how much climate change could add to the costs of maintaining public infrastructure in Alaska in the near future (by 2030). This report describes how that model was developed, and presents preliminary estimates of additional public infrastructure costs resulting from climate change. The report concludes that a changing climate could make it 10 to 20 percent more expensive to build and maintain infrastructure, and that climate change induced damages could add $3.6 to $6.1 billion in future costs for maintaining and replacing infrastructure in Alaska by 2030. Public infrastructure assessed in the model included not only roads and bridges, but also airports, harbors, schools, military bases, post offices, fire stations, sanitation systems and the power grid. It is estimated that Alaska’s roads will make up approximately 25 percent of the added future infrastructure costs.
The primary climate impacts to Alaska’s infrastructure will occur from thawing permafrost, flooding and coastal erosion. Additional costs will arise from the need to maintain or replace roads and other assets that will become increasingly damaged as a result of climate changes. ISER finds that the extra costs will likely diminish over time, if government agencies progressively adapt infrastructure to changing conditions. The study determines that between now and 2030, infrastructure adaptations could help reduce costs related to climate change to as much as 13 percent, depending on the extent of climate warming. Furthermore, between now and 2080, adaptations could save anywhere from 10 to 45 percent of costs resulting from climate change.
To design the cost estimation model, ISER took the following steps:
- They developed a comprehensive database of public infrastructure in Alaska’s 350 communities (Alaska Public Infrastructure Database);
- Acquired climate projections from the best available climate models including the 2007 IPCC report;
- Estimated how thawing permafrost and increased flooding and coastal erosion could affect infrastructure costs (the model did not estimate effects on infrastructure for projected increases in sea levels);
- Estimated the future cost of maintaining and replacing existing infrastructure assuming no climate change (base case) using average infrastructure replacement costs, depreciation values, and useful life (20 years for roads);
- Estimated the additional costs under three climate scenarios: low, medium and high; and
- They estimated additional costs with and without efforts to adapt infrastructure to climate change impacts. These estimates were based upon an assumption of event-driven incremental adaptive response, meaning that adaptation would occur after infrastructure is damaged and the lost life-span to the asset is greater than 20 percent.
By combining the outputs from the three climate models and the infrastructure database in a life-cycle cost estimation model, “the ISER Comprehensive Infrastructure Climate Life-Cycle Estimator (ICICLE)”. This model can be used to calculate the net present value cost of infrastructure at risk due to changes in temperature and precipitation from climate change. The model uses thawing permafrost, increased flooding, and more coastal erosion to gauge damage to infrastructure, and uses the life span of infrastructure as a basis for estimating increased replacement and maintenance costs. Permafrost thaw was estimated to reduce the years of life of an asset by up to 0.5 percent per degree increase in temperature, flooding by up to 7.5 perfect for highly exposed assets per degree increase in temperature and inch increase in precipitation, and extreme events by an additional 10 percent.
Even without climate change, maintaining and replacing infrastructure in Alaska is forecasted to cost an estimated $32 billion by 2030 and $56 billion by 2080. Climate change could add an additional $3.2 billion (10%) to $6.1 billion (20%) to infrastructure costs by 2030, and $5.6 billion (10%) to $7.6 billion (12%) by 2080, under different climate projections. These numbers assume that government agencies will implement adaptation efforts. It was determined that transportation infrastructure - especially roads and airport runways - will be responsible for most of the additional costs between now and 2030 - with roads making up 25 percent of the additional cost. Transportation infrastructure is expensive to build and maintain in Alaska in general, and many airports and roads are in areas that will be most affected by climate change.
Chapter IV of the report describes how the preliminary database of public infrastructure around Alaska was built, and how the replacement costs and useful life of that infrastructure was established. The chapter includes estimates of the current value of 19 types of infrastructure, as well as maps of the location of transportation and other types of infrastructure.
Chapter VII provides model results including developed estimates of the present value of the cost of public infrastructure replacement under a range of conditions. A base case scenario is presented, assuming continued replacement of the current public infrastructure without the effects of climate change. Then the results of three exploratory scenarios of climate change are provided, each modeled with and without adaptation. From this, preliminary estimates are established for the likely range of additional infrastructure costs resulting from the impacts of climate change.
This Adaptation Clearinghouse entry was prepared with support from the Federal Highway Administration. This entry was last updated on January 30, 2015.
Publication Date: June 2007
Authors or Affiliated Users:
- Peter Larsen
- Scott Goldsmith
- Orson Smith
- Meghan Wilson
- Ken Strzepek
- Paul Chinowsky
- Ben Saylor
- University of Alaska Anchorage
- Institute of Social and Economic Research (University of Alaska-Anchorage)
- Academic research paper
- Modeling tool