VANCOUVER — The costs to British Columbia’s economy from last year’s unprecedented heat dome, horrific wildfires, widespread flooding and crippling landslides could be more than $17 billion, making it the most expensive climate disaster in Canadian history.
A study released today by the Canadian Centre for Policy Alternatives provides a first-ever estimate of the total economic costs associated with 2021’s back-to-back extreme weather events. The study pegs those costs between $10.6 billion and $17.1 billion, much of which is borne directly by households and businesses.
Typically, cost estimates following disasters focus on insured damages to property and cleanup costs to governments. But the new research goes deeper, considering lost income for workers due to business closures, lost productivity, and specific impacts on communities, particularly the vulnerable and marginalized.
“If ever there was a year that underscores the costs of climate change, 2021 was it,” says lead report author Marc Lee, a senior economist with the CCPA BC Office. “The costs go way beyond insured losses, which are typically the focus in the aftermath of disasters like those we saw last year.”
The report also for the first time estimates the lost wages from temporary or permanent business closures due to the extensive flooding and wildfires or to work lost due to the extreme heat, which resulted in unsafe working conditions that made it impossible, in some cases, to carry on. The report estimates that impacted workers collectively lost $1.5 billion to $2.6 billion.
“As shown in this report the climate crisis affects us all, but some people are much more vulnerable to its impacts,” said Jonathan Fowlie, Vancity’s Chief External Relations Officer who oversees the credit union’s impact and climate efforts. “This research lays bare the real costs of BC’s biggest climate disasters.”
Vancity Credit Union, who funded the research, is dedicated to using financial tools and levers to help communities become resilient to climate change – especially for those most affected by these disasters, said Fowlie.
Grand Chief Stewart Phillip, President of the Union of BC Indian Chiefs, notes that among the most vulnerable communities in the province are First Nation communities.
“An overwhelming number of First Nations are not properly resourced to prepare for climate change disasters and adequately protect their communities, despite passage of the Declaration Act, which upholds self-determination,” Grand Chief Phillip said. “This research underscores the dire importance of making our communities less vulnerable to climate change and making every effort to prevent warming in the first place. We must immediately stop any further expansion of fossil fuels and fracking of liquefied natural gas. There is no time to waste.“
“We hope that this research impresses on the provincial and federal governments the urgent need to assist vulnerable communities. We estimate that it will cost upwards of $169 million to build proper dikes along the Coldwater River to safeguard us from the kind of devastating floods that hammered us last year,” says Merritt mayor, Mike Goetz. “Our municipal taxes amount to just $9.5 million per year. There is no way we can do that expensive yet vital work without support from senior levels of government.”
“When you look at the horrific, widespread damage of last year, those multiple shocks to our economy quickly translate into a tally that runs into the billions of dollars,” Lee says. He stresses that the events of last year are “a prelude to what can be expected in the months and years ahead, and not just here in BC.”
“We must prepare and plan for adaptation to a warmer world. My hope is that the bigger picture on the economic costs associated with last year’s climate events serves to underscore the need for immediate action – to prepare for the impacts that we can no longer prevent and to reduce emissions so we avert the worst effects of climate change.”
For more information and to arrange interviews contact: Jean Kavanagh at 604-802-5729, [email protected]
A Climate Reckoning: The Economic Costs of BC’s Extreme Weather in 2021 was undertaken by the Canadian Centre for Policy Alternatives BC Office in partnership with Vancity. The CCPA–BC thanks Vancity for their financial support of this research.