Up to $4 trillion worth of assets at risk from climate change in cities worldwide
- 10 July 2014
LONDON: Up to four trillion worth of assets are at risk from climate change in cities worldwide, according to a new report from CDP.
Protecting our Capital, which was conducted in partnership with AECOM and the Cities Climate Leadership Group (C40), examines the strategies cities worldwide have deployed to mitigate further warming and safeguard their financial well-being.
Cities, which are now home to over half the global population, are a major hub for economic activity and generate 80% of global GDP. However, cities are particularly susceptible to climate change, with the analysis pointing to as much as four trillion worth of assets in jeopardy before 2030 due to the global rise in temperatures.
This vulnerability has been acknowledged by cities, with 76% of the 207 cities surveyed admitting climate change could affect the local private sector. In light of this risk, climate adaptation plans are now key policy documents for 102 cities, and the authors note 757 adaptation activities have been introduced worldwide.
So far this year carbon emissions inventories have been released by 108 cities - an action which signals the growing awareness that a business-as-usual approach is not an option. Kerem Yilmaz, C40 head of research noted the “need to understand and act upon climate risk is a growing priority. That’s why these cities are taking steps right now to help create more climate-resilient communities, economies and infrastructure”.
In London, the rise in global temperatures has prompted financial giant Morgan Stanley to upgrade air-conditioning at its data center, costing the company US$4.4 million. Similarly, rising tides pushed energy firm, CLP Holdings to spend US$193,000 raising building floor levels and US$516,000 on improving drainage capacity, the analysts elucidate.
Furthermore, more than three quarters of the contributing cities believe acting on climate change makes financial sense. Portland in the US even explained how an innovative Energy Challenge program introduced over 20 years ago has saved the city US$42 million.
“Local governments are storming ahead to protect their citizens and businesses from the impacts of climate change, but further collaboration with business is needed to increase city resilience", observed Larissa Bulla, head of CDP’s cities program. “Through the provision of information, policies and incentives, cities can help equip businesses to manage these risks and embrace the opportunities.”
Commenting on the report's findings, Mark Kenber CEO of The Climate Group, remarked:“Cities which are at the forefront of innovative climate action are reaping the economic rewards. By championing smart transport, energy efficiency policies and resilience initiatives, cities send a signal to global companies that their operations base will be safe from climate risk. Such a strategy not only attracts commercial activity boosting GDP, it also safeguards the health and wellbeing of the families for whom the city is home."
"With our urban population now at 3.5 billion, we must seize the immense opportunity that a smart city infrastructure presents. ”
Graphics courtesy of CDP, AECOM and the Cities Climate Leadership Group (C40)
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