The global loss and damage arising from all weather events that were attributable to man-made climate change in 2016 was
This is based upon estimated carbon emissions for 2016 of 37,705,000,000 tCO2, and PAL’s global one-year Carbon Loss Index (CLIX) of $25.30 per tonne of CO2. The CLIX benchmark measures loss and damage attributable to manmade climate change. It additionally provides the minimum floor price required to raise sufficient revenue from carbon emitters to fund the cost of AIMS (Adaptation, Insurance, Mitigation and Social Fund) projects and programmes that tackle the impacts of climate change.
Munich Re, the world’s largest reinsurance company, reports US$175 Bn of disaster and catastrophe loss in 2016. NOAA’s 2016 global land surface and ocean temperature anomaly is 0.94 Celsius but, as 82% of the climate-related loss hazard is in the Northern Hemisphere, PAL estimates that the effective temperature anomaly for 2016 is 1.063 Celsius. Using PAL’s methodology this equates to $4,673 Bn of weather related losses globally, of which 20.4% is attributable to climate change.
The PAL gamma prediction algorithm puts a dollar value on historical and future loss and damage. Allowing for regional variations, the 2016 loss was $876 bn. This rises to $1051 bn if all losses were calculated equitably. By this measure, global weather-related losses have exceeded $1 trillion for the first time ever.
See how this year’s Carbon Liability is evolving by taking a look at our Carbon Liability Clock.
Predict Ability Ltd (PAL) is committed to supporting the adoption of a universal and transparent carbon price. PALcarbon is a real-time carbon pricing and reporting system for clients that takes into account the real cost of damage caused by carbon emissions. PALgamma is a computing risk engine for forecasting extreme weather related disaster events and identifying the impact of man-made climate change. CLIX is a Carbon Loss Index providing a benchmark for the real cost of loss and damage caused by carbon emissions. Predicting the Price of Carbon: How to tackle the climate change code for good is a recent publication that addresses the goals and strategies for tackling climate change.
Author: Richard Clarke
Richard Clarke is Director (Research) and co-founder of PAL. He has authored many academic articles and made keynote presentations at conferences on heat exchangers, helium resources and supply. He has recently published his second book, on climate change and the insurance industry, Predicting The Price of Carbon. Richard developed the science behind PAL Carbon.