Gov’t and private money is pouring into plans to control flooding, address extreme heat, and shore up infrastructure to withstand more severe weather caused by climate change.
Doug SheridanDoug Sheridan • 1st • 1stEnergy, Economics & Policy | Research • Analysis • Commentary • OpinionEnergy, Economics & Policy | Research • Analysis • Commentary • Opinion1h • Edited • 1 hour ago
The WSJ writes, efforts to address the cause of climate change have fallen short so far. That is leading to a big push to treat the symptoms.
Gov’t and private money is pouring into plans to control flooding, address extreme heat, and shore up infrastructure to withstand more severe weather caused by climate change.
Nearly all climate change spending so far has gone to prevention, including reducing fossil-fuel use and developing technologies to lower carbon dioxide in the atmosphere. Those mitigation efforts haven’t been enough.
Funds aimed at addressing the effects of climate change recently accounted for about 5% of the roughly $1.3 trillion spent annually on all climate efforts, according to a report from the Global Center on Adaptation and the Climate Policy Initiative.
For private-sector investors, putting money into adaptation is a bet that mitigation won’t fully address climate change or will take longer than expected. The cost of adaptation is immense, particularly if mitigation efforts are delayed. The longer society waits to address climate change, the more it will spend to fend off the impact of hotter, wetter weather, researchers say.
The money is part of a slew of climate tax credits, grants and loans mostly funded by the 2021 infrastructure law and 2022 Inflation Reduction Act. The DOE, EPA and other offices are racing to award funds and show progress before November’s elections.
It is difficult for investors to put money into adaptation because projects such as flood barriers, tidal gates and raising roads threatened by rising water levels often don’t offer attractive returns and are mainly jobs for governments, which have long funded flood-prevention projects.
That is increasing the need for new programs, but many local and state agencies don’t have the money for these projects.
Our Take 1: On the one hand, it's a positive that we're now recognizing there will be no energy transition or glorious march to net zero any time soon. Of course, it would have been far better to not have wasted trillions on non-solutions so far, with promises of trillions more in spending because of the inertia of gov't subsidies and mandates.
Our Take 2: Adaptation was always a smarter way forward, given the lack of options. That said, we're not so naive as to think that today's public officials are qualified to efficiently implement cost-effective adaptation measures. We worry this will be another gorge fest of waste, opportunism and flat-out incompetence. If so, expect wasteful spending to get worse before it gets better.
Our Take 3: We're now on track to spending enormous sums coming and going in the name of climate change. But effectively bankrupting ourselves implementing ill-considered adaptation measures is no more attractive than doing so on mitigation non-solutions like wind and solar. For the foreseeable future, climate change remains for big gov't the gift that keeps on giving.
