by Mindy Lubber
“Rebuild smarter.” That’s the constant refrain in the wake of Superstorm Sandy, as New York, New Jersey and Connecticut work to repair the devastation to seaside communities, businesses and the infrastructure that ties them together.
Policymakers and thought-leaders at the local, regional and national level are warning that plans to rebuild must take into account the likelihood that more, and stronger, storms like Sandy will hit again – whether on the East Coast, Gulf Coast or West Coast – in the not-too-distant future.
“You don’t have to be a believer in climate change to understand the dangers from extreme weather are already here,” said New York City Mayor Michael Bloomberg at a recent press conference. “Whether or not one storm is related to climate change or is not, we have to manage for risks, and we have to be able to better defend ourselves against extreme weather and natural disasters.”
Insurers, who absorbed an estimated $25 billion in losses from Sandy, are sounding the alarm, too.
“We need to figure out how to close this climate resiliency gap,” Zurich Financial Services’s Lindene Patton said, referring to outdated infrastructure ill equipped for higher sea levels and bigger storm surges. “What we have today is a series of physical assets which are becoming less and less appropriate given the changing weather patterns that we face. You don’t want to assume something’s going to last 30 years only to have it blown away in 10.”
Rebuilding smarter means finding ways to keep people, and vital infrastructure, out of harm’s way. It means strengthening power systems with smarter designs to prevent the multi-day outages that left hundreds of thousands in the cold and dark for days following the storm. It means revitalizing the natural systems, such as creating wetlands, which once helped protect our shores from storm surges and flooding.
But it won’t happen quickly. By some estimates, it may take ten years, and tens of billions of dollars, before hard-hit areas like the Jersey Shore start to resemble their pre-Sandy outlines. Additional resiliency measures for thwarting more powerful storms will cost exponentially more. (One example of this: Consolidated Edison says it would cost $40 billion to put its electric lines underground.) One thing is certain: no one jurisdiction can do it alone. Extreme events like superstorms and super-droughts cross all boundaries, political and geographic. And solutions, both the financial costs and necessary policies, must cross those boundaries as well.
Is such collaboration possible – especially when one considers the political bickering over last week’s Sandy disaster relief bill? After months of delay, Congress came together Friday to approve $9.7 billion of initial disaster relief while also making assurances that another $51 billion of aid will be voted on January 15.
There are models outside of Washington for this kind of collaboration. Along the Pacific coast, leaders of California, Oregon, Washington and British Columbia have been working together since 2008 on the Pacific Coast Collaborative (PCC), promoting cross-border efforts to grow the economy, create jobs, advance clean, renewable energy, and reduce dependence on fossil fuels. Most recently, these jurisdictions announced the creation of the West Coast Infrastructure Exchange, designed to boost efforts to invest in critical infrastructure needs, including upgraded roads, bridges and water systems.
The PCC provides the structure necessary to strengthen long-term collaboration and financing support between governments, businesses and investors. Similar public-private partnerships are needed on the East Coast and elsewhere for post-Sandy rebuilding, and some of them are already in the works.
In December, the New York City Teachers Retirement System pledged $1 billion for new investments in infrastructure projects in New York City and throughout the tri-state area, including improvements to transportation, power, water, communications and housing. In Louisiana, power utility Entergy is restoring wetlands that will help soften the blow from future storms. In Maryland, which has seen a dozen Chesapeake Bay islands disappear due to sea level rise, the state’s governor signed an executive order last month mandating that new bridges, roads and sewer systems be designed with higher sea levels in mind. He’s also asked regulators to raise electricity rates by a dollar or two a month to allow utilities to do more resiliency work.
Factoring climate change into such building and rebuilding efforts is only common sense. The sweeping economic losses from subways, electricity, hospitals and Wall Street being shuttered by Sandy will be felt for years to come. Yet the lesson hits with the force of a flood: Cost-effective resiliency investments can help avoid future economic calamities. We must ensure that policymakers, businesses and investors act on that lesson before the next catastrophe strikes.
Mindy S. Lubber is the president of Ceres and a founding board member of the organization. She also directs Ceres’ Investor Network on Climate Risk (INCR), a group of 100 institutional investors managing nearly $10 trillion in assets focused on the business risks and opportunities of climate change. This piece was originally published at Ceres and was reprinted with permission.