Compensating Low-Income Nations for Climate Damage: How to Accurately Calculate the Figures?

As the planet warms, a major concern in international climate negotiations is compensating developing countries for the damage they have suffered. But which nations should receive money? And which extreme weather events were affected by climate change?

Most countries signed an agreement last year to set up a so-called “loss and damage fund”. It would offer a means for developed countries – which are disproportionately responsible for greenhouse gas emissions – to provide money to vulnerable countries that have to deal with the consequences of climate change.

Part of the fund would help developing countries recover from catastrophic extreme weather. For example, it can be used to rebuild houses and hospitals after a flood or to transfer food and emergency money after a cyclone.

Some experts have suggested the science of “event attribution” could be used to determine how the funds are distributed. Event attribution attempts to discover the causes of extreme weather events, particularly whether human-induced climate change played a role.

But as our new paper argues that event attribution is not yet a good way to calculate compensation for countries that are vulnerable to climate change. An alternative strategy is needed.

What is Event Attribution?

Extreme weather events are complex and caused by multiple factors. The science of the attribution of extreme events strives for it in the first place train whether human-induced climate change or natural variability in climate contributed to these events.

For example, a recent study found the extreme rainfall that causes New Zealand’s February floods were ongoing 30% more intense due to human influence on the climate system.

Attribution science is developing rapidly. It is increasingly focusing on extreme rain events, which have been difficult to study in the past. But it is still not a consistent and robust way of estimating the costs and consequences of extreme events.

Read more: COP27: one major breakthrough but ultimately an inadequate response to the climate crisis

Why can’t we use it?

Event attribution science is based on both observational weather data and climate model simulations.

Typically, two types of climate model simulations are used: simulations that include the effects of man-made greenhouse gas emissions, and simulations that exclude them. By comparing the two types of simulations, scientists can estimate how climate change affects the likelihood and severity of extreme events.

But climate models mainly simulate processes in the atmosphere and the ocean. They don’t directly simulate the damage caused by an extreme weather event – such as how many people died as a result of a heat wave or loss of infrastructure during a flood.

To directly simulate the effects of an extreme event, we need to know exactly to what extent weather components such as temperature and rainfall have caused damage. In some cases, this can be determined. But it requires high-quality data, such as hospital admissions, which are rarely available in most parts of the world.

Also, climate models are not good at simulating some extreme events, such as thunderstorms or extreme winds. That’s because such events are sporadic and usually occur in small areas. This makes them more difficult to model than, say, a heat wave that affects a large area.

So if “loss and damage” funding decisions depend too much on event attribution, a low-income country hit by a heat wave may receive more support than a country damaged by storms or high winds, relative to the damage caused .

Moreover, event attribution is not yet able to estimate how climate change causes damage associated with so-called “link“extreme events.

Composite events refer to cases where more than one extreme event occurs simultaneously in adjacent regions, or sequentially in a single region. Examples are a drought followed by a heat wave, or a rise in sea level that exacerbates the damage of a tsunami.

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Where do we go from here?

Event attribution is not yet sophisticated enough to calculate “loss and damage” from climate change.

Instead, our paper suggests that “loss and damage” funds are used alongside foreign aid spending to support recovery in low-income countries from extreme events where human-induced climate change may have played a role.

We also present four key recommendations for using event attribution to estimate “loss and damage” in the future. These are:

1. Help developing countries use event attribution techniques: to date has event attribution largely implemented by rich countries in their own region

2. Tackle more types of extreme events: tornadoes, hailstorms and lightning are largely beyond the capabilities of climate models used in event attribution because they are localized and complex. New techniques must be tried to investigate these events

3. More research into the consequences and costs of extreme events: Few studies have attempted to attribute the costs of extreme events to climate change. Further efforts are needed, especially in low-income countries

4. Combine event attribution with other knowledge: Scientists and aid and policy-making experts should collaborate on a strategy for using event attribution information. A better understanding of the needs of policy makers and the limitations of event attribution science could lead to more useful studies.

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A growing burden

Low-income countries have contributed relatively little to global emissions. Compensation of richer countries is vital to helping them achieve the growing burden of climate damage.

But distributing these funds fairly is a challenge. Until the field of event attribution advances, relying too much on event attribution is a risky strategy.

The authors acknowledge Izidine Pinto’s contribution to the research underlying this article.