Worried that your business will be hurt by that $60 trillion worldwide economic hit because of Arctic ice melting?
Don’t be. While there are no certainties in life and business – and fewer still in science – the scenario making the rounds can’t happen. And that’s the opinion not of climate-change deniers, but rather of people who have devoted their lives to climate research.
First, some background. Researchers in the journal Nature suggest that the recent acceleration of Arctic melting is an “economic time bomb” that will lead to $60 trillion worth of economic losses worldwide, as floodwaters ravage the developing world.
It has grabbed headlines in the financial press, notably the Financial Times. What made the study unusual was that economists had a dirty little secret: Arctic ice melting, from an economic standpoint, is a near-term economic positive, since it lowers transportation costs by opening up new northern shipping lanes.
But a $60 trillion economic hit would affect businesses of all shapes and sizes around the world, and negate any benefits from the warming north.
Here’s the problem: While the headlines are eye-catching, the underlying data are head-scratching. The researchers, from the University of Cambridge and Erasmus University Rotterdam, cite the East Siberian Sea in Russia as the basis for the problem. Under the permafrost in that sea is believed to be as much as 50 billion tons of methane trapped in the ice. Under the Nature scenario, melting of the permafrost would release that methane into the atmosphere, which would accelerate the melting in the Arctic, flood the world and make us broke.
Here are the two (really, really, really) big flaws with that scenario. First, no one actually knows how much methane is trapped under the East Siberian Sea. There is one Russian study that gives the 50-billion-ton figure. But there is actually some debate about what is under there.
Second, science tells us that, even if there are 50 billion tons of methane, there is no way all gets released into the atmosphere at once. In fact, methane bursts happen over time and are calculated in decades and centuries, not one-time releases. And some stays put. As Vincent Gauci, a researcher at Open University, told the blog CarbonBrief.org, some of the methane “could be oxidized in the water by bacteria, and some could remain in the sediments on the seafloor.”
The Arctic ice is indeed melting, and climate change is a real business issue. There are real business and economic reasons for sustainability efforts at companies big and small.
But that $60 trillion figure is bunk. And bad business.