Generating savings from our most cost-effective coastal defenses

Last year was the costliest year ever for natural disasters in the United States, with more than $300 billion in damages from hurricanes, severe storms, and wildfires. The impact of these disasters goes well beyond a dollar figure. Americans have lost homes, businesses — and in some instances, loved ones.

Coastal risks are rising. Wise investments to help shield communities from this kind of devastation are a must — both for the safety of our people and to maximize limited public dollars.

{mosads}Yet, for too long we have neglected solutions right before our very eyes — our coastal ecosystems. Increasing evidence shows that investing in nature-based solutions can often be the best way to provide cost-effective protection.

Since Hurricane Katrina in 2005 and the Indian Ocean tsunami in 2004, there has been a great deal of work to determine the effectiveness of natural solutions for reducing the risks from natural hazards. That is, do habitats reduce flood risks? That question has now been answered quite decisively. They do.

For example, coastal wetlands prevented more than $625 million in property damages during Hurricane Sandy. Annually, wetlands reduce flood damages by more than 15 percent across the Northeast. During Hurricane Wilma and other storms, coral reefs reduced more than 97 percent of the wave energy that would otherwise impact coastlines.

But these past works only addressed one half of the challenge — effectiveness. A new paper addresses the other half of the problem and shows that coastal habitats can provide protection cost-effectively, particularly when compared to built or gray infrastructure such as seawalls or dikes.

The study uses insurance industry-based models to show that every $1 spent on restoring marshes and oyster reefs on the American Gulf Coast reduces storm damages by $7. That’s a strong return on investment—and that doesn’t even include other benefits nature provides, such as fishing, recreation, and water purification.

The new work applied the Economics of Climate Adaptation (ECA) approach, which was developed by Swiss Re, a leading global re-insurance firm, and others to understand coastal risk and solutions. Industry analyses done for the Caribbean Catastrophic Risk Insurance Facility have also shown that coral reefs and mangroves are some of the most cost-effective solutions for risk reduction across the tropical Atlantic.

These newly quantified benefit/cost ratios can inform decisions on cost-effective approaches to recover from natural and man-made disasters. This is particularly critical now, after Hurricanes Harvey, Irma and Maria, as agencies such as FEMA and HUD decide how to use tens of billions in storm recovery funding.

These findings are significant because coastal risk managers, insurers, engineers and policy makers at all levels can now directly compare the cost effectiveness of nature-based (“green”) and structural (“gray”) defenses for reducing risk from storms and sea level rise across a region as large as the Gulf of Mexico.

Despite the benefits of ecosystems for coastal defenses, we do not work to rebuild and restore them in line with their proven cost-effectiveness. For example, following Hurricane Sandy, less than 1 percent of recovery funding went to rebuilding natural defenses.

Congress and key agencies can take three critical steps to efficiently and effectively use nature-based solutions to help protect our communities.

First, we should evaluate natural defenses along with “built” options as part of the design mix for any risk management plan. This makes simple fiscal sense. There will still be places where structural defenses will be necessary to protect communities, but in many areas natural infrastructure or a combination of natural and gray infrastructure will be the best option. This new study shows that a mix of the most cost-effective solutions could reduce near-term (2030) risk by 50 percent across the Gulf of Mexico.

Second, recovery spending from disasters should recognize natural infrastructure such as wetlands and reefs as critical infrastructure and allocate funds more in line with the level of risk-reduction benefits they provide. Habitats further provide recreational, cultural and other benefits that should also be accounted for when making coastal investment decisions.

Third, Congress can use the next Water Resources Development Act to promote and incentivize the use of natural infrastructure at the Army Corps of Engineers. Incorporating the proven results of natural defenses into Army Corps projects will build stronger communities that have lower flood damage risks, better water quality, and more recreational opportunities.

If you could invest $1 now to get $7 in savings; would you? Of course you would; to get the best future returns.

Michael W. Beck is a Research Professor at the University of California Santa Cruz and Lead Marine Scientist for The Nature Conservancy.

Robert Bendick is Gulf of Mexico Program Director for the Nature Conservancy.