Quantifying Adaptation Costs and Expenditures
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Quantifying Adaptation Costs and Expenditures
- 1. www.ieep.eu Quantifying Adaptation Cost www.ieep.eu November 24, 2010
- 2. Climate, Energy and Transport @ IEEP Project Overview • Project for DG Clima: IEEP and Statistics Sweden • Project objectives, looking at planned measures: – Determining additional funding for adaptation – Mainstreaming adaptation in to the next MFF • Project deliverables: – Methodology to account for expenditure – Methodology to calculate cost 2
- 3. Climate, Energy and Transport @ IEEP Accounting for Expenditure • Review of existing expenditure • Standard Definitions • Classification of Measures • Incorporating adaptation in to existing accounting • Challenge? – Incompatibility between EU and National accounting – Statistical confidentiality when expanding to autonomous measures 3
- 4. Climate, Energy and Transport @ IEEP Calculating Cost • Need for political decisions in determining additionality • Projected impacts and decision-making – How can budgets be devised given the uncertainty of future events? – Scenario analysis and probabilities? • Analysed historical data from NASA: looked at possibility of determining a monthly mean – Could there be a way of predicting average temperature exceedences on a monthly basis? 4
Notas del editor
- The focus of our work is largely methodological – not empirical. It wasn’t supposed to calculate actual cost, but to outline a series of steps that could be applied to different cost assessments, in addition to proposing a methodology to gather statistics. Cost approaches were assessed in relation to planned measures that would be implemented by three levels of government, with the idea that a proposed methodology would need to be flexible and replicable. The discussion paper emphasizes the need to reduce state liability – our report looked more at how you would actually both account for, and quantify cost (in this case being synonymous with cost, although we focussed more on actual cost not avoided cost). The issue of compensation for damages due to climate change was not discussed in great detail – although insurance was one of the measures that was initially considered. Previous damage could be used as a way of calculating cost – cost incurred for previous events could be used as the basis for estimating the impacts of other extreme weather events.
- As a result of completing a literature review and consultation with national statistics offices and Eurostat, we concluded that most budgets lack the appropriate amount of transparency to be able to determine what governments are spending on adaptation. To be able to do this, we need to standardize a number of concepts and definitions, and a system through which we can analyze or interpret spending in relation to a commonly accepted list of adaptation measures. In answering the question in relation to state liability (as outlined in the discussion document), we need to determine what that actually is – which involves determining three things: source of adaptation expenditure based on all public and private revenue sources, 2 – expenditure (including damages) by government and standard sectors, and 3 – attributing spending by government sector and level to different weather events/impacts. Changes to national accounting procedures at the national level may not be comparable to those required in relation to the EU budget. While the EU needs to have a clear understanding of what is spent at the national level to allocate funding efficiently (thereby requiring stricter environmental accounting at the national level), that is a separate question from improving the transparency of the EU budget itself to reflect what is being spent on adaptation.
- Based on a literature review and discussions with experts in the field, our report concluded that calculating the cost of adaptation will depend on the objective of the cost equation, and a number of interdependent factors such as local vulnerability and the measure in question. We based our methodology on the need for measures to respond to impacts – the measure to be implemented is of prime consideration as part of the overall approach.