Vast costs of Arctic change


Vast costs of Arctic change
Methane released by melting permafrost will have global impacts that must be better
modelled, say
Gail Whiteman
Chris Hope
Peter Wadhams
nlike the loss of sea ice, the vulner

ability of polar bears and the rising
human population, the economic
impacts of a warming Arctic are being
Most economic discussion so far assumes
that opening up the region will be beneficial.
The Arctic is thought to be home to 30% of
the world’s undiscovered gas and 13% of its
undiscovered oil, and new polar shipping
routes would increase regional trade
. The
insurance market Lloyd’s of London esti

mates that investment in the Arctic could
reach US$100 billion within ten years
The costliness of environmental damage
from development is recognized by some,
such as Lloyd’s
and the French oil giant
Total, and the dangers of Arctic oil spills are
the subject of a current panel investigation
by the US National Research Council. What
is missing from the equation is a worldwide
perspective on Arctic change. Economic
modelling of the resulting impacts on the
world’s climate, in particular, has been scant.
We calculate that the costs of a melting
Arctic will be huge, because the region is
pivotal to the functioning of Earth systems
such as oceans and the climate. The release
of methane from thawing permafrost
beneath the East Siberian Sea, off northern
Russia, alone comes with an average global
price tag of $60 trillion in the absence of
mitigating action — a figure comparable to
the size of the world economy in 2012 (about
$70 trillion). The total cost of Arctic change
will be much higher.
Much of the cost will be borne by devel

oping countries, which will face extreme
weather, poorer health and lower
Pipes transport oil from rigs on Endicott Island in Alaska.
25 JULY 2013 | VOL 499 | NATURE | 401
© 2013 Macmillan Publishers Limited. All rights reserved
agricultural production as Arctic warming
affects climate. All nations will be affected, not
just those in the far north, and all should be
concerned about changes occurring in this
region. More modelling is needed to under

stand which regions and parts of the world
economy will be most vulnerable.
As the amount of Arctic sea ice declines
at an unprecedented rate
, the thawing of
offshore permafrost releases methane. A
50-gigatonne (Gt) reservoir of methane,
stored in the form of hydrates, exists on the
East Siberian Arctic Shelf. It is likely to be
emitted as the seabed warms, either steadily
over 50 years or suddenly
. Higher meth

ane concentrations in the atmosphere will
accelerate global warming and hasten local
changes in the Arctic, speeding up sea-ice
retreat, reducing the reflection of solar
energy and accelerating the melting of the
Greenland ice sheet. The ramifications will
be felt far from the poles.
To quantify the effects of Arctic meth

ane release on the global economy, we used
PAGE09. This integrated assessment model
calculates the impacts of climate change and
the costs of mitigation and adaptation meas

ures. An earlier version of the PAGE model
was used in the UK government’s 2006 Stern
Review on the Economics of Climate Change
to evaluate the effect of extra greenhouse-gas
emissions on sea level, temperature, flood
risks, health and extreme weather while taking
account of uncertainty
. The model assesses
how the net present value of climate effects
varies with each tonne of carbon dioxide
emitted or saved.
We ran the PAGE09 model 10,000 times to
calculate confidence intervals and to assess
the range of risks arising from climate change
until the year 2200, taking into account sea-
level changes, economic and non-economic
sectors and discontinuities such as the melt

ing of the Greenland and West Antarctic
ice sheets (see Supplementary Information; We superposed
a decade-long pulse of 50 Gt of methane,
released into the atmosphere between
2015 and 2025, on two standard emissions
scenarios. First was ‘business as usual’:
increasing emissions
of CO
and other
greenhouse gases
with no mitigation
action (the scenario
used by the Inter

governmental Panel
on Climate Change
Special Report on
Emissions Scenarios
A1B). Second was a ‘low-emissions’ case, in
which there is a 50% chance of keeping the
rise in global mean temperatures below 2°C
(the 2016r5low scenario from the UK Met
Office). We also explored the impacts of later,
longer-lasting or smaller pulses of methane.
In all of these cases there is a steep global
price tag attached to physical changes in
the Arctic, notwithstanding the short-term
economic gains for Arctic nations and some
The methane pulse will bring forward by
15–35 years the average date at which the
global mean temperature rise exceeds 2°C
above pre-industrial levels — to 2035 for the
business-as-usual scenario and to 2040 for
the low-emissions case (see ‘Arctic methane’).
This will lead to an extra $60 trillion (net pre

sent value) of mean climate-change impacts
for the scenario with no mitigation, or 15%
of the mean total predicted cost of climate-
change impacts (about $400 trillion). In the
low-emissions case, the mean net present
value of global climate-change impacts is
$82 trillion without the methane release;
with the pulse, an extra $37 trillion, or 45%
is added (see Supplementary Information).
These costs remain the same irrespective of
whether the methane emission is delayed
by up to 20 years, kicking in at 2035 rather
than 2015, or stretched out over two or three
decades, rather than one. A pulse of 25 Gt of
methane has half the impact of a 50 Gt pulse.
The economic consequences will be
distributed around the globe, but the model

ling shows that about 80% of them will occur
in the poorer economies of Africa, Asia and
South America. The extra methane magni

fies flooding of low-lying areas, extreme heat
stress, droughts and storms.
The full impacts of a warming Arctic, includ

ing, for example, ocean acidification and
altered ocean and atmospheric circulation,
will be much greater than our cost estimate
for methane release alone.
To find out the actual cost, better models
are needed to incorporate feedbacks that
Bubbles of methane emerge from sediments below a frozen Alaskan lake.
402 | NATURE | VOL 499 | 25 JULY 2013
“There is a
steep global
price tag
to physical
changes in the
© 2013 Macmillan Publishers Limited. All rights reserved

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