Today we are releasing a major new report, California Climate Risk and Response, authored by Professor David-Roland Holst and Fredrich Kahrl at UC Berkeley, which provides for the first time a comprehensive examination of the economic impacts of climate change and adaptation in California. In conducting this multi-sector assessment, we compile the most recent available science on climate damage, assess its economic implications, and examine alternative strategies for adaptation.

Last month, Next 10 released Energy Efficiency, Innovation and Job Creation in California by Professor David Roland-Holst at UC Berkeley, that showed by taking account of the potential for innovation, the proposed package of policies in the state's Draft Scoping Plan continues California's legacy of efficiency-driven job growth, increasing the GSP by $76 billion and creating over 400,000 new efficiency and climate action driven jobs. The report also produced a retrospective economic analysis and found that over the last 35 years, because of the state's pioneering role in energy efficiency policy, 1.5 million new jobs were created, producing $45 billion in payroll.

A core finding of our California Green Innovation Index (look out for the 2009 edition in January) is that California's landmark energy and environment policies have resulted in the nation's lowest greenhouse gas emissions per capita while helping to grow the highest GSP.

Our new report, California Climate Risk and Response, provides us with four overarching findings:

1. Our estimates indicate that climate risk -- damages if no action is taken -- would include tens of billions per year in direct costs, even higher indirect costs, and expose trillions of dollars of assets to collateral risk.

Economic Damage and Asset Risk Estimates for California




2006 USD Billions Damage Cost/Year     Low High Assets at Risk Water  NA  0.6 5   Energy  2.7  6.3  21   Tourism and Recreation  0.2  7.5  98   Real Estate  0.2  1.4 900 Water  0.1  2.5  1,600 Fire Agriculture, Forestry, Fisheries  0.3  4.3 113   Transportation  NA  NA 500   Public Health  3.8 24.0  NA   Total  7.3 46.6

Note: All of the values in this table are drawn from tables
and text in the sections on individual sectors in the full report.

2. Climate response -- mitigation to prevent the worst impacts and adaptation to climate change that is unavoidable -- on the other hand, can be executed for a fraction of these net costs by strategic deployment of existing resources for infrastructure renewal/replacement and significant private investments that would enhance both employment and productivity.


3. At the sector level, there will be some very significant adjustment challenges, requiring as much foresight and policy discipline as the state can mobilize. In this context, the political challenges may be much greater than the economic ones. The state's adaptation capacity depends upon flexibility, but divergence between public and private interests may limit this flexibility. As in the current financial dilemma, resolving this will require determined leadership.


4. Despite the extent and high quality of existing climate research reviewed in this document, the degree of uncertainty regarding many important adjustment challenges remains very high. This uncertainly is costly, increasing the risk of both public and private mistakes and the deferral of necessary adaptation decisions. The process of improving research and understanding of climate effects may itself be costly and difficult, but policymakers must have better visibility regarding climate risk and response options.

Please download an executive summary and the full report California Climate Risk and Response online at www.next10.org/research/research_ccrr.html. You can download Energy Efficiency, Innovation and Job Creation in California at www.next10.org/research/research/research_eeijc.html.

We hope these materials are useful to you and your networks. If you have any questions or feedback for us, we would love to hear from you. Please email us at info@next10.org or call 650-321-5417.