Tuesday, March 24, 2009

Climate Insurance

They always tell you to follow the money. A good example is the money flow away from AIG and to some of their highly valued employees.

Perhaps the way we will get more public attention on the issues surrounding the climate disruption that we have brought on this planet will come from the outflow of money from insurance companies for losses stemming from extreme weather events and sea level rise.

According to the Wall Street Journal, state insurance regulators will require insurance companies to disclose how climate change is affecting their business.
The officials acted after concluding that climate change threatens insurers in two ways. It increases the risk of extreme weather events such as floods and wildfires, which would boost claims. And it is prompting governments to cap industrial carbon emissions that contribute to global warming -- a move threatens the profits of companies such as coal-fired utilities in which insurers commonly invest.

Click Read more! for the rest... it gets interesting.

If the big guys are worried about what is going to happen with coal fired power plants, what should the rest of us think about. Maybe we need to be on the lookout for public / private partnerships and quasi governmental organizations that will need to be bailed out because they have already sunk funds is a project that can only cost more and never deliver what it promises. Case in point: Treasure Island in San Francisco Bay. I posted the following in a comment at Climate Progress where I first read of this.
There is a major project being planned for Treasure Island in San Francisco Bay. This is property that the City of San Francisco has acquired when the US Navy decommissioned their facilities.
The January 14, 2009 meeting of the TREASURE ISLAND DEVELOPMENT AUTHORITY had this on their agenda.

Their approach leaves much to be desired, including the 36″ sea level rise projection.

The preferred design approach is to achieve finish floor elevations with a free board of six inches in a worse-case scenario (100 year storm event plus 36” inches sea level rise). Perimeter open space areas will having limited, short term ponding at high tide. The geotechnical design approach includes a range of techniques for densifying soil and subgrade materials to mitigate issues associated with liquefaction and settlement.

It will be very expensive and not do the job if all they plan for is a 36 in rise. I wonder how hard it will be for any potential tenant to get insurance. I wonder if those who are already occupying Treasure Island will have recourse against the City for failure to consider the effects of global warming before they started this project. I wonder if the project’s chief cheerleader, Gavin Newsome, gets a pass because he claims to be “green”.
It might be time for San Francisco's Green Supervisor to call for a review of the entire project.

The one San Francisco Supervisor who is on the Treasure Island Development Authority, Chris Daly, has always had a political game going on. He wants to make this the affordable housing solution for San Francisco. This sounds like a typical un-thoughtful project. Sell all the poor people a sinking solution.

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