Climate financial risk: the federal government's exposure to financial risk due to climate change

Abstract

Using statistical models relating climate to wildfire and suppression spending, we estimated federal wildfire suppression spending through the end of the 21st century. We project that area burned on national forest lands each year, on average, may close to double by mid-century. Across the ten different climate scenarios considered, expected increases in area burned range from 42% to 306%. By late century, national forest area burned would increase by 232% on average, with a range of increases from 29% to 2,488%. With these increases, median suppression real-dollar spending by the Forest Service would rise by 42% by mid-century (ranging from 20% to 84%) and 81% by late-century (17% to 283%). Suppression spending projections did not consider all costs of wildfire management or the value of damages created by wildfire. Hazardous fuels were not directly modeled, so this analysis does not account for the agency’s efforts under the Wildfire Crisis Strategy.

Citation

Prestemon, J.P., Erin Belval, Jennifer Costanza, Shannon Kay, Jeffrey Morisette, Karin Riley, Karen Short, Bruno Kanieski daSilva. 2024. U.S. Department of Agriculture Forest Service and U.S. Department of the Interior: Update on Projected Wildland Fire Suppression Costs Due to Climate Change Impacts. Pages 17-53, 96-131 in: White House, Office of Management and Budget, “Climate Financial Risk; The Federal Government’s Budget Exposure to Financial Risk Due to Climate Change.” March 2024, Washington, DC. 131 pages.