The Governor’s Conference on "Extreme Climate Change and California’s Future," convened by Gov. Jerry Brown, highlighted the urgency of developing technologies and policies that would curb greenhouse gas emissions. Gov. Brown emphasized that denying climate change is counter-productive since the world has recently experienced the deleterious effects of climate variability. Gov. Brown and other prominent participants suggest that resources should be channeled toward emission reduction by shifting to renewable energy sources and disaster preparation. In California, extreme high and low temperatures and severe storm systems are recent manifestations of climate change. California can expect more flooding and more dangerous wildfires in the future.
Managing the aftereffects of climate change-related events can be costly. Hefty insurance payouts to victims of disasters will eventually be passed on to taxpayers in the form of higher premiums and increased government expenditures. In the meantime, California’s business communities will be engulfed in disaster mitigation and preparedness along with rising commercial insurance costs. Private insurers are now factoring hurricanes, floods, drought and other climate change issues into risk calculations.
Communities along coastal areas are concerned that increasing costs of small business insurance in Oakland and elsewhere could overburden companies already reeling from the effects of the recession. Environmental scientists and economists assert that the threat to the state’s diverse industries is real. It is predicted that sea levels would rise by four feet by the end of this century. A storm surge would push water inland and put the Oakland and San Francisco airports under water, affecting Silicon Valley as well.
Huge investments will be required to protect and retrofit existing structures along California’s bay front. It may even be prudent to abandon vulnerable structures in damage-prone areas to focus resources on coastal armoring and protection in priority areas. Business costs and insurance for offices in Oakland will be greatly impacted under this scenario. On one hand, development costs will require huge capital outlays to meet updated infrastructure standards. But operating expenses will have to reflect the costs of better building designs that reduce energy use while shifting to greener alternatives and reducing carbon emissions in the process.