The frequency and cost of billion-dollar extreme weather disasters in America have surged dramatically, with the National Oceanic and Atmospheric Administration (NOAA) highlighting significant economic impacts and the growing urgency of addressing climate-related risks.
There have been 383 instances of extreme weather or climate disasters since 1980, with at least $1 billion in damages. These calamities have cost over $2.7 trillion in total.
This graphic, courtesy of Jenna Ross of Visual Capitalist, was made in collaboration with the National Public Utilities Council and illustrates how the frequency of these catastrophes has been rising over the last ten years.
A Growing Concern
Every disaster is monitored by the National Oceanic and Atmospheric Administration (NOAA) in the United States, which also makes cost estimates based on time losses and physical damages such as disruptions to company operations. To accommodate for inflation, they modify all expenditures using the Consumer Price Index.
Extreme weather disasters have increased in frequency and expense throughout time. As of now, the number of disasters in the 2020s has not even reached half of what it was in the 2010s.
Since 1980, 50% of all disasters costing billions of dollars have been caused by severe storms, making them the most frequent. Tropical cyclones have incurred the greatest portion of costs—more than 50% of the total. With $199 billion in inflation-adjusted expenses, Hurricane Katrina, which made landfall in 2005, continues to be the most expensive single disaster.
Electricity and Extreme Weather Disasters
The escalation of severe storms and other calamities has a substantial effect on people’s access to electricity. Droughts, for example, have been linked to a decrease in hydropower, a significant source of renewable electricity generation in the United States.
Utility businesses may incur substantial costs as a result of disasters. Potential damage claims against Hawaii Electric for the 2023 wildfire might total $5 billion, about eight times the company’s insurance coverage. The business is being sued for allegedly neglecting to maintain its infrastructure, including failing to reinforce electrical poles to resist strong winds.
Some businesses have started making preparations for extreme weather events and climate disasters since they pose the greatest risk to the utility sector. This includes making changes to infrastructure, boosting insurance coverage, and burying electricity lines.
Last year, GreatGameIndia reported that, according to Victor Gensini, a meteorology professor at Northern Illinois University, the reason why the U.S. leads the world in weather catastrophes is due to the Gulf of Mexico and the elevated terrain to the west.