Heat in the Heartland
This week I’m writing from Minneapolis, where the Risky Business Project just launched its latest report, ‘Heat in the Heartland,’ focused specifically on the potential economic costs of climate change to the U.S. Midwest. The launch was a great success, with nearly 500 business and policy leaders from across the region gathered to hear about and discuss our findings.
As the title of the report suggests, heat is an important part of the picture. There's a reason we call this stuff "global warming!" Unsurprisingly, our findings indicate that Midwestern states are likely to see steadily increasing temperatures in the near term and throughout the century, along with changes in precipitation that could have a serious effect on the region’s economy. For example, by the end of this century, Missouri is likely to experience as many extremely hot days (95 degrees Fahrenheit and up) every year as the average Arizonan experiences today. Meanwhile, summers in Minnesota and Wisconsin will feel more like summers in Washington, D.C., today. As a Wisconsinite who’s endured my fair share of D.C. summers, I’m not looking forward to the change!
Even more alarming is the prospect of increasing heat combined with high humidity. By late this century, some parts of the Midwest region could experience conditions in which simply being outside puts you at risk of deadly heat stroke. We refer to this threshold as the Humid Heat Stroke Index (HHSI) in our reports, but it’s also known as “wet-bulb” temperature. It's the condition that arises when the combination of heat and humidity becomes so intense that the human body can no longer cool itself by sweating. Scary stuff!
We also studied the impact that changing temperatures and precipitation will have on some of the region’s primary economic sectors: manufacturing, energy, and agriculture. The hotter it gets, the more energy we’ll need to keep cool. Meanwhile, the hotter it gets, the less efficiently we’re able to generate electricity. The end results will be increasing costs for businesses, especially manufacturing, which is highly energy-intensive. In part because of its high concentration of manufacturing operations, the Midwest already uses about 20 percent more energy per dollar of GDP than the national average, so the region is certain to feel the pinch.
The Midwest is also known as the breadbasket of the world, supplying much of the nation’s staple grains. It produces more than 65 percent of the nation's corn and soybean crops, for example. But absent significant adaptation by farmers, over the next 5 to 25 years some counties in Missouri, Illinois, and Indiana will likely see average commodity crop losses up to 18 to 24 percent each year due to extreme heat. Iowa, the biggest corn producer in the region, could experience a huge hit to its state economy due to crop losses – from $850 million to as much as $12 billion per year by the end of the century.
Check out the report online for the full story. For more info, join us on Monday for a twitter chat with Risky Business Co-Chair Mike Bloomberg – I’ll be answering questions from the @climaterisk handle. And for those readers wondering why we haven’t similarly zeroed in on California’s climate risk profile, never fear! Our next report will focus on the Golden State.
Speaking of which, here in California, a lot has happened since I last wrote. Governor Brown released his draft budget for 2015-16, and it includes significant commitments to address climate change. Here’s a quick roundup:
- AB 32
- This year’s budget includes over $1 billion in the Greenhouse Gas Reduction Fund, generated from the state’s cap and trade program. The funds will be used to expand a host of initiatives to reduce our emissions and improve our resilience to climate change, including improving public transit and affordable housing, building energy efficiency, and waste diversion.
- Echoing calls by environmental equity advocates, Assemblyman Henry Perea penned a letter to legislative leaders last week calling for a higher proportion of cap and trade funds to be targeted in the state’s most disadvantaged communities. Currently, under SB 535, California must target at least 25 percent of cap and trade funds to benefit disadvantaged communities. Now the Fresno assemblyman is calling for at least 35 percent of the total funds raised to benefit the same communities.
- Just last year, Asm. Perea made waves by authoring legislation to delay the inclusion of transportation fuels in cap-and-trade program. But Perea is a pragmatist and understands that many of his constituents stand to benefit from the investments California is making using Cap and trade revenues. In his letter, the Assemblyman cites “ample evidence” of the disproportionate harm faced by low-income communities burdened with poor air quality and other environmental stressors, and urges his colleagues to ensure that these communities are not left behind. We could not agree more, and applaud Asm. Perea for highlighting this important issue.
- Prop 39:
- In the coming year, $320 million will go towards energy efficiency and renewable energy projects in K-12 schools and another $39 million will go to community colleges, representing a slight bump from last year’s allocation. The program is now in its second year, and with a full year of experience designing projects and a streamlined set of program guidelines from the Energy Commission, I’d expect school districts will be well positioned to take advantage of these much needed funds.
- School facilities
- Once again, the Governor’s draft budget highlighted some concerns with the structure and effectiveness of the state’s existing school facility funding program, but offered no solutions and no additional funding. As a result, a coalition of school facilities advocates has filed paperwork with the Attorney General’s office to place a $9 billion dollar school bond measure on the ballot in 2016. There are also several bills in play in the legislature, so expect to hear more on this as the year progresses.
- If you’re interested in learning more, the UC Berkeley Center for Cities and Schools (CC+S) has some recommendations for what a new program should look like. Essentially, CC+S Deputy Director Jeff Vincent and colleagues are recommending that the state adopt some of the same principles embodied in the Local Control Funding Formula in its prioritization of school facilities funding.
Until next time!