Storms and sea level rise could cost ports billions

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If greenhouse gas emissions continue to grow, ports around the world will suffer billions of dollars in losses. Extreme weather, flooding, and rising sea levels would damage vital seaport infrastructure, disrupting global supply lines.

According to a report commissioned by the Environmental Defense Fund, storms and port disruptions could cost $10 billion a year by the year 2050. Without action on climate change, those costs could balloon to more than $25 billion a year. The total operating profits for the entire global container shipping industry in a year is more than that figure.

Many ports are already over capacity after the COVID-19 Pandemic exposed weaknesses in global supply chains. The shipping industry and ports have a lot of work to do to cut down on pollution and avoid the worst-case scenarios outlined in the report.

The climate emergency will have major consequences for international shipping, just as the COVID-19 pandemic threw our ports and the global supply chain into crisis mode.

Storms are one of the biggest threats and can cause infrastructure and vessels to be damaged. Most of the losses in the report are due to the damage they do to ports. There is growing evidence that tropical storms are getting more intense in a warming world. That means more rain and stronger winds. When sea levels are rising, destructive waves and storm surge are bigger.

Should storms tear through ports, those changes come with bigger price tags. The cost of hurricanes in the US is about $2.2 billion. The economic toll at the port in Mobile, Alabama, alone could have been more than five times larger if sea levels and storm surge were as high as some models predict by the year 2200, according to a new report.

Recovery costs are still high after storms. The report shows the costs of adapting to climate change. The ports might have to raise structures, build protective barriers, or even move to higher ground. Ships have to chart new routes to avoid bad weather. According to the report, weather was responsible for 1 in 5 vessels lost across the globe from 2015 to 2019.

The path forward is not set in stone. The worst-case scenario for the climate crisis is if greenhouse gas emissions continue. The world isn't on track to eliminate greenhouse gas emissions by the middle of the century, despite the Paris agreement.

Some policymakers are thinking about how to prepare. A bipartisan infrastructure law in the US last year included $17 billion in improvements to ports and waterways. The White House fact sheet says that ports face extensive challenges modernizing infrastructure and maintaining essential facilities under threat from sea level rise and other climate challenges.

How do you engage with companies to help them understand their own asset risk? Facilitating more collaboration between policymakers and industry is a key foundation for supply chain resilience.

Retail and shipping giants are using vessels that are lesspolluting. That's important, since maritime shipping contributes nearly 3% of global greenhouse gas emissions. Most goods are transported by ship. The report says that the shipping industry should act now or pay later.