The Cost of Adapting to Climate Change for Infrastructure
This paper presents the results of a global analysis from the World Bank’s 'Economics of Adaptation to Climate Change' study of the costs of adapting infrastructure to climate change over the period of 2010 to 2050. An approach to estimating the costs of adapting to climate change is presented along with the estimated results for major components of infrastructure. In this context, infrastructure includes transport (especially roads, rail, and ports), electricity, water and sanitation, and communications, along with urban and social infrastructure such as urban drainage, urban housing, health and educational facilities (both rural and urban), and general public buildings. According to the World Bank, the work reported in this paper represents the most extensive and careful effort that has been made to estimate the costs of adapting to climate change in the infrastructure sector at a global level.
The analysis identifies the price and quantity of effects of climate change separately. First, the report reviews how climate change alters the cost of a baseline program of infrastructure development via changes in design standards and operating costs. The second component measures the effect of climate changes on the long-run demand for infrastructure.
The primary conclusion is that the cost of adapting to climate change, given the baseline level of infrastructure provision, is no more than 1–2 percent of the total cost of providing that infrastructure. While there are differences across regions and sectors, "the pattern is clear and unambiguous - the cost of adaptation is small in relation to other factors that may influence the future costs of infrastructure."
This report was developed as a “Discussion Paper” as part of the Economics of Adaptation to Climate Change (EACC) study - a large, multiyear undertaking managed by a core team of the World Bank’s Environment Department.
Publication Date: August 2010
- The World Bank