Feds Begin To Quantify Hidden Climate Change Costs

As debate over climate legislation rages, reporters will encounter many confusing and seemingly contradictory statements about the costs of changing US energy practices.

You may help your audience with an understanding of how incomplete the cost figures cited by companies and politicians often are. Many of the estimates focus primarily on direct costs. But there also are many indirect and hidden costs — many of them health or environmental — related to the full life cycle of energy production and use, according to a Congressionally-mandated report that was released Oct. 19, 2009, by the National Academies' National Research Council:

• "Hidden Costs of Energy: Unpriced Consequences of Energy Production and Use;" press release.

The authors say the quantifiable costs alone, primarily covering health damages from selected air pollutants emitted by vehicles and electric utilities, were at least $120 billion in 2005, and likely will be far higher in the next couple of decades unless dramatic emission reductions occur. Among the effects for which they couldn't yet assign a dollar value are ecosystem and infrastructure damage, health effects from many pollutants, and threats to national security.

In the lengthy, detailed report that undoubtedly contains a number of surprises for most readers, the authors say that the financial markets fail to account for these costs, and that government efforts to remedy these market failures may be warranted.

For a selection of estimates by others of the direct costs of climate change, see the TipSheet of Sept. 30, 2009.