A monsoon lightning storm strikes over Las Vegas, in this photo taken July 7, 2014.
Climate change is being blamed for the rising number of severe weather incidents around the world, which leads to increased costs for businesses and consumers.
Canada is not immune. Droughts, heavy rainfall and harsh storms are taking their toll on a wide range of industries, and global impacts can have a spinoff effect.
In 2011, for example, flooding in Thailand forced the closure of auto-parts plants, forcing companies such as Honda to temporarily cut production at its U.S. and Canadian factories.
Droughts in California have driven up the price of certain foods exported to Canadian consumers, while ice storms in eastern Canada and severe flooding in southern Alberta in 2013 led to lost productivity that put a dent in Canada's gross domestic product.
Severe weather events are forecast to continue in an era of climate change, with a direct impact on industries as they try to cope with and mitigate the damage.
When businesses pay higher costs, it inevitably filters down to consumers.
Climate change has a price tag
"What the scientists are telling us about what the impacts are going to be: We are going to pay more for food, more for water, and for insurance. Those things are going to happen," says Alexander Wood, senior director, policy and markets at Sustainable Prosperity, a research group based at the University of Ottawa.
In a recent research report, Sustainable Prosperity looked at how climate change's impact on agricultural production could reverberate through the Canadian economy.
The report shows that a 10-per-cent drop in agricultural productivity would lead to a 4.4 per cent price increase in food and non-alcoholic beverages. That, in turn, would deter consumption and impact a range of businesses such as restaurants and hotels.
Wood says one of the problems with trying to predict future economic impacts of climate change is that it's not clear how much worse it could get. "What we don't have in Canada right now is a very clear idea of what the various global warming scenarios will do."
He says he believes the government needs to step in with stronger policies to promote action on climate change.
"Climate change has a price tag and it could be expensive. But few Canadians know what that could be," says a 2011 report from the now dismantled National Round Table on the Environment and the Economy (NRTEE), called Paying the Price: The Economic Impacts of Climate Change for Canada.
It forecasted that costs for Canada could escalate from roughly $5 billion a year in 2020 to between $21 billion and $43 billion a year by the 2050s, depending on global emissions growth and Canadian economic and population growth.
In one example, it says impacts on the timber supply, through changes in pests, fires, and forest growth, could cost the Canadian economy $2 billion to $17 billion a year. Costs of flooding in coastal areas from rising sea levels could be between $1 billion and $8 billion a year by the 2050s, the report adds.
It also points out that illnesses associated with poor air quality will impose costs on the health care system, which in Toronto alone could cost between $3 million and $11 million a year by the 2050s.
"Adapting to climate change is both possible and cost-effective," the NRTEE report notes, while calling on the federal government to cost out and model climate impacts to help make future policy decisions. (The agency was shut down in 2012.)
Few industries spared
Other key industries expected to be impacted by climate change include energy, mining, manufacturing, transportation, housing and insurance.
"Any industry that is subject to climate as part of its production will be affected," says Dr. John Nyboer, adjunct professor at Simon Fraser University's School of Resource and Environmental Management.
There's also the impact of climate change policies on businesses, such as British Columbia's carbon tax, which is based on greenhouse gas emissions generated from burning fuels.
If policies set up to encourage an overall reduction in emissions become more common, Dr. Nyboer says heavier polluting industries such as mining and oil and gas will be hard hit.
The insurance industry is on the front lines when it comes to impacts of climate change, in part because it's doubly exposed through rising payouts to policyholders and its own investments that may be affected.
According to a report in the Financial Times, Bank of England recently wrote to dozens of insurance companies asking them to assess the risk climate change has on their solvency and earnings.
Insurance Bureau of Canada (IBC) says Canadian communities are seeing more intense weather, which not only disrupts lives, it also costs billions of dollars.
IBC said insured damage caused by natural disasters was the highest in Canadian history in 2013, at $3.2 billion, the fourth straight year where insured losses from natural disasters were near or above $1 billion.
That includes the floods in southern Alberta in June, 2013, which IBC calls the costliest natural disaster in Canada's history, with insured damage of more than $1.74 billion. In July, flash flooding in Toronto resulted in $940 million in damages, the most expensive insured natural disaster in Ontario's history, according to IBC.
It said the December, 2013 ice storm in southern Ontario and eastern Canada resulted in $200 million in insured losses.
According to the latest report from the Intergovernmental Panel on Climate Change (IPCC) published in early November, most sectors of the North American economy have been affected by extreme weather. Some industries are also attempting to mitigate risks and adapt through improved infrastructure and price structures that offer companies discounts for these efforts.
"There is mounting evidence that many economic sectors across North America have experienced climate impacts and are adapting to the risk of loss and damage from weather perils," the IPCC report states.
However, it notes there's "only an emerging consideration" of proactive measure to adapt to future global warming impacts. The IPC is calling on industries to do more to prepare for the predicted increase in severe weather in the coming decades.
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