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How much will the wildfires cost?

By Jill Cowan

The fires across the West have continued to burn, continued to kill people, and continued to incinerate homes and fill our air with smoke. Firefighters have continued to do the arduous, time-consuming work of containing explosive flames before they reach the places we most want to protect.

It’s an all-consuming cycle — one in which it would be understandable to forget that, once the fires have been extinguished, it’s all going to cost residents, businesses and governments a lot of money.

Tom Corringham, a researcher at the Scripps Institution of Oceanography, has not forgotten.

“We’re setting records year after year,” he told me Tuesday. “It’s a little early to say what the total impacts are going to be, but it wouldn’t surprise me if the damages are over $20 billion this year.”

And that, he added, is counting only the “direct costs.”

Corringham studies the economic effects of extreme weather, which, as you might expect, are at once growing and difficult to count.

In addition to the relatively clear-cut dollar figures associated with fighting the fires and the damage to property, there are health care bills, costs of disrupted business, lost tax revenue, decreased property values and what Corringham described as “reverse tourism” — people fleeing smoke or not visiting certain areas because of it.

Studies show those indirect costs add up to at least as much as the direct ones; some studies say it’s multiples more.

I’d spoken to Corringham before, because he and his team previously analyzed the costs of atmospheric rivers. (Remember those?) Heavy rains brought by atmospheric rivers caused on average about $1 billion in damage each year in the West, his study found.

Over the past 50 years, excluding the last four, wildfires averaged about the same in direct damages: $1 billion per year, adjusted for inflation.

But in three of the past four years, including this one, fires are on track to cause damages in excess of $10 billion.

“We’ve seen an order of magnitude leap in damages in the last four years,” he said in an email.

None of that even touches on the rippling costs of the record-breaking heat waves that have hit California this year nor does it account for the fact that the fires are coming in the midst of an economically catastrophic pandemic.

Corringham said that figuring out ways to more fully quantify the costs of disasters driven by climate change would help make the financial case for bigger, longer-term policy fixes.

“Any reasonable analysis has shown that the return on investment to shifting the economy away from fossil fuels is just huge,” he said.

That’s especially true as renewable energy becomes less expensive globally.

All the data, grim as it may be, is also helping scientists improve climate models, which in turn helps policymakers and insurers determine risks of building in certain fire-prone areas.

In the meantime, he said, policymakers must think about how to get people to move to areas that are safer — from fires, from heat, from sea level rise and flooding — including compensating them, not just for their homes but also for the loss of community.

They must do so with fairness and equity in mind.

“At the end of the day, the most important element is mitigation,” he said. “If we don’t do that, these costs are going to continue to spiral out of control.”


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