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Dr Mark Stafford SmithChief Coordinating Scientist - Adaptation
Dr Mark Stafford Smith is based in Canberra, Australia, and helps to coordinate Adaptation Research across CSIRO. He interacts regularly with national and international policy issues around adaptation. Since 2013 he has been Chair of the inaugural Science Committee for Future Earth, which aims to help coordinate research towards global sustainability worldwide. By background, he lived in Alice Springs for 20 years and, as a desert systems ecologist and past CEO of the Desert Knowledge Cooperative Research Centre (CRC), focused on the science of desert living and sustainable management of outback environments. |
A conversation with Dr Mark Stafford Smith of CSIRO
The impacts of climate change are already clearly visible in Australia. Further impacts are predicted to be experienced across all sectors of the economy and in all ecosystems.
The less we reduce emissions, the more we will have to adapt; for warming greater than 2ºc, the most sensitive sectors in Australia, which will require most early adaptation, are: water, the natural environments, cities and infrastructure, the coastal zone, and agriculture.
In their report on Climate Change impacts, the Bank of England’s Prudential Regulation Authority identified 3 types of risks to companies from climate change:
http://www.bankofengland.co.uk/pra/Documents/supervision/activities/pradefra0915.pdf
Direct risks include how the effects of climate change may act through supply chains – ie. there will be climate change issues in other parts of the world that will affect Australia, particularly as we have a trade exposed economy. The costs of imported goods could go up or down, creating risks or opportunities for our market competitiveness. In addition disasters elsewhere in the world may interrupt supply chains that our businesses depend on.
There are many areas that will be affected by climate change:
Health
Vectors for diseases could move further south as the warmer weather brings tropical diseases to sub-tropical areas. In general, Mark believes that the Australian health system is well adapted to cope, but the extra costs will still affect the population.
Heat waves tend to impact the elderly and those on low incomes. This is especially true when power outages cut off air conditioning, and low or non-existent insulation on low cost housing increases the chances of heat stress. Suburbs without much ‘green infrastructure’ (trees and parks) can also be significantly hotter than green areas.
Many lower cost houses and age care facilities are built on cheaper land in low lying areas or close to the coast and so are prone to floods and storm surges.
Agriculture
Obviously agriculture is affected by climate, particular rain and temperatures. There have been demonstrable declines in winter rainfall already in SW Australia, which means that the farmers are missing out on winter crops. Similar trends are becoming detectable in SE Australia in recent times.
Apart from the direct effects of climate on farm production, there is also a link between severe drought and suicides of farmers and workers. The psychological strain on the population is likely to get worse as weather patterns become more extreme.
Finance Sector
In the absence of accounting for climate risks on property, the finance sector may increasingly struggle to get property insured. With the amount of housing held by Australian banks that could put a strain on their financials.
Other assets could become stranded and are subject to transitional risk as the asset price fall precedes the actual weather change.
Insurance companies could also be hard hit, but some companies are being pro-active in trying to mitigate their risk profiles. The problem is that insurance aims to offset risk in pone place with what is happening elsewhere; but if climate change raises risks systematically across the world, this ability to offset one lower risk country with another is reduced.
Insurance companies will have to partner with government to overcome these risks or else there will be fewer people paying higher premiums for their cover.
Construction
Potential risks in the construction industry may be managed by stronger regulations on where and to what standard buildings are constructed. For example if cyclones move further south, then properties should be built to higher cyclone ratings. Also some current areas close to the sea and in low lying areas may become off limits to new construction. If that land is part of a company’s land bank then the assets becomes stranded, and would have to be written down.
Can technology help?
Mark Stafford Smith believes that technology can help, but won’t solve all the problems. Technological changes have been very fast – often faster than predicted – and are starting to solve some problems with alternative energy and battery technology becoming more sophisticated and cheaper in recent years. However, it would be foolish to imagine technology will solve everything.
Australia First
Mark Stafford Smith believes that Australia will be hit with climate change earlier and harder than many other developed countries. This is an opportunity for us to adapt and find solutions and maybe then on-sell those solutions to the rest of the world.
Australia can be in the vanguard of adaption pathways and can become consultants to the world on adaption processes.
Stafford Smith suggests that we have to ask where the climate change problem exists locally, create a solution using local skills and then find markets for that solution in wider sustainable solutions world-wide.
The Domino Effect
In 2009 in Melbourne there was a heat wave and many premature deaths, power failures, railway lines buckled and agriculture suffered with lower output of produce. The cost was over $1 billion in lost revenue because the total losses were greater than the sum of the parts. This occurred because of interactions – for example, the loss of power meant people couldn’t get to work, so there was a knock on effect on other industries and services. And some of those losses are never regained.
So the answer to some of the problems associated with climate change need to be considered in a coordinated way. That will require government planning.
Can we make the 2 degree Target?
Based on the commitments made by countries in Paris in 2015, the science indicates that it is unlikely that the world will restrict the warming to less than about 3 degrees, even if all these commitments are met. This would mean not only more hotter days, but more sporadic and wilder weather. Hopefully countries will gradually increase their aspirations to bring the target genuinely below 2 degrees, but for now good adaptation planning still needs to allow for the possibility of high levels of climate change.
Who will do well out of climate change?
Mark Stafford Smith believes early investment into renewables and services lowering emissions will pay dividends. An obvious example is battery technology and how that has become front and centre to finding long term solutions to power requirements.
Other companies that will do well will be those that help to adapt the current economy to the new norm, with better planning and services that can mitigate the excesses of the hotter wilder environment.
The less we reduce emissions, the more we will have to adapt; for warming greater than 2ºc, the most sensitive sectors in Australia, which will require most early adaptation, are: water, the natural environments, cities and infrastructure, the coastal zone, and agriculture.
In their report on Climate Change impacts, the Bank of England’s Prudential Regulation Authority identified 3 types of risks to companies from climate change:
- Direct risks- such as the direct effects of lower rainfall, longer droughts or sea level rise on companies’ assets and operations.
- Transitional Risks- effects arising from policies that are designed to respond to climate change, such as prices on carbon or changing planning requirements.
- Legal risks- arising from the actual or perceived responsibilities of company directors for addressing the potential effects of climate change
http://www.bankofengland.co.uk/pra/Documents/supervision/activities/pradefra0915.pdf
Direct risks include how the effects of climate change may act through supply chains – ie. there will be climate change issues in other parts of the world that will affect Australia, particularly as we have a trade exposed economy. The costs of imported goods could go up or down, creating risks or opportunities for our market competitiveness. In addition disasters elsewhere in the world may interrupt supply chains that our businesses depend on.
There are many areas that will be affected by climate change:
Health
Vectors for diseases could move further south as the warmer weather brings tropical diseases to sub-tropical areas. In general, Mark believes that the Australian health system is well adapted to cope, but the extra costs will still affect the population.
Heat waves tend to impact the elderly and those on low incomes. This is especially true when power outages cut off air conditioning, and low or non-existent insulation on low cost housing increases the chances of heat stress. Suburbs without much ‘green infrastructure’ (trees and parks) can also be significantly hotter than green areas.
Many lower cost houses and age care facilities are built on cheaper land in low lying areas or close to the coast and so are prone to floods and storm surges.
Agriculture
Obviously agriculture is affected by climate, particular rain and temperatures. There have been demonstrable declines in winter rainfall already in SW Australia, which means that the farmers are missing out on winter crops. Similar trends are becoming detectable in SE Australia in recent times.
Apart from the direct effects of climate on farm production, there is also a link between severe drought and suicides of farmers and workers. The psychological strain on the population is likely to get worse as weather patterns become more extreme.
Finance Sector
In the absence of accounting for climate risks on property, the finance sector may increasingly struggle to get property insured. With the amount of housing held by Australian banks that could put a strain on their financials.
Other assets could become stranded and are subject to transitional risk as the asset price fall precedes the actual weather change.
Insurance companies could also be hard hit, but some companies are being pro-active in trying to mitigate their risk profiles. The problem is that insurance aims to offset risk in pone place with what is happening elsewhere; but if climate change raises risks systematically across the world, this ability to offset one lower risk country with another is reduced.
Insurance companies will have to partner with government to overcome these risks or else there will be fewer people paying higher premiums for their cover.
Construction
Potential risks in the construction industry may be managed by stronger regulations on where and to what standard buildings are constructed. For example if cyclones move further south, then properties should be built to higher cyclone ratings. Also some current areas close to the sea and in low lying areas may become off limits to new construction. If that land is part of a company’s land bank then the assets becomes stranded, and would have to be written down.
Can technology help?
Mark Stafford Smith believes that technology can help, but won’t solve all the problems. Technological changes have been very fast – often faster than predicted – and are starting to solve some problems with alternative energy and battery technology becoming more sophisticated and cheaper in recent years. However, it would be foolish to imagine technology will solve everything.
Australia First
Mark Stafford Smith believes that Australia will be hit with climate change earlier and harder than many other developed countries. This is an opportunity for us to adapt and find solutions and maybe then on-sell those solutions to the rest of the world.
Australia can be in the vanguard of adaption pathways and can become consultants to the world on adaption processes.
Stafford Smith suggests that we have to ask where the climate change problem exists locally, create a solution using local skills and then find markets for that solution in wider sustainable solutions world-wide.
The Domino Effect
In 2009 in Melbourne there was a heat wave and many premature deaths, power failures, railway lines buckled and agriculture suffered with lower output of produce. The cost was over $1 billion in lost revenue because the total losses were greater than the sum of the parts. This occurred because of interactions – for example, the loss of power meant people couldn’t get to work, so there was a knock on effect on other industries and services. And some of those losses are never regained.
So the answer to some of the problems associated with climate change need to be considered in a coordinated way. That will require government planning.
Can we make the 2 degree Target?
Based on the commitments made by countries in Paris in 2015, the science indicates that it is unlikely that the world will restrict the warming to less than about 3 degrees, even if all these commitments are met. This would mean not only more hotter days, but more sporadic and wilder weather. Hopefully countries will gradually increase their aspirations to bring the target genuinely below 2 degrees, but for now good adaptation planning still needs to allow for the possibility of high levels of climate change.
Who will do well out of climate change?
Mark Stafford Smith believes early investment into renewables and services lowering emissions will pay dividends. An obvious example is battery technology and how that has become front and centre to finding long term solutions to power requirements.
Other companies that will do well will be those that help to adapt the current economy to the new norm, with better planning and services that can mitigate the excesses of the hotter wilder environment.