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Melted chairs are shown outside the burned Maligne Lodge after wildfires encroached into Jasper, Alta., on July 26.Amber Bracken/Reuters

Blair Feltmate is head of the Intact Centre on Climate Adaptation at the University of Waterloo, where Anabela Bonada leads wildfire research.

With extreme weather hitting all regions of Canada – punctuated recently by the Jasper wildfires – Canadians might assume that substantial federal resources have been devoted to preparing for extreme weather. They assume wrong.

Environment and Climate Change Canada rolled out a newly minted National Adaptation Strategy in 2023. The NAS presented 26 targets that focus on limiting the impacts of wildfire, flooding and extreme heat.

While it’s a good step forward, the problem with the NAS is funding. A good plan, with limited resources, does not go far – think back to the adaptation initiatives laid out in the 2016 “Pan-Canadian Framework on Clean Growth and Climate Change.” With no funding, those initiatives never made it off the shelf.

Does Canada have the money to finance adaptation? The answer is yes, but this requires rebalancing climate investments.

Since 2015, when Canada signed the Paris Agreement, the federal government dedicated $42-billion to mitigating greenhouse-gas emissions (for activities to ramp up renewable energy, boost energy efficiency, and lower fossil fuel emissions from industrial sources). Over the same period, the government directed $1.9-billion to adaptation, primarily to support protection from wildfire and floods affecting communities and households.

The federal government spends 22 to 1 on mitigation and adaptation. This ratio is greatly lopsided and explains why funding for adaptation to counter extreme weather is in short supply. Canada must readjust climate financing to make funding for adaptation and mitigation more equitable.

The argument in Canada against directing funding from mitigation to adaptation is that climate change may speed up if industrial GHG emissions remain high. On the surface this argument makes sense, but it has a flaw.

There are two major categories of GHG emissions in Canada, with one vastly outstripping the other.

Emission reductions address the GHG emissions from human activities, across sectors including oil and gas, transportation and agriculture. In 2005, Canada released 761 megatonnes of GHG – by 2022, emissions were 708 megatonnes, marking a reduction of 53 megatonnes.

A reduction of 53 megatonnes signals Canada’s effort to meet its commitment to the Paris Agreement and its 2030 Emissions Reduction Plan that pledged by 2026 Canada would reduce GHG emissions by 20 per cent below 2005 levels.

However, a reduction of 7 per cent in GHG emissions, which consumes 95 per cent of Canada’s climate budget, merits a rethink, particularly when considered against newly documented sources of GHG emissions from non-human activities.

In July, 2024, the World Resources Institute calculated that total emissions of carbon dioxide from forest fires in Canada exceeded 3,000 megatonnes – vastly overshadowing savings realized through the Emissions Reduction Plan.

Moreover, the cost of extreme weather in Canada – against a backdrop of limited adaptation – is growing exponentially. From 1983 to 2008, annual insurable claims from extreme weather hovered between $250-million and $400-million per year. From 2009 to the present, for 14 out of the last 15 years, insurable claims exceeded $1-billion per year, for an average cost of $2.1-billion.

With residential wildfire insurance recently pulled by major insurers in California and parts of Washington State, a red light should be flashing for Canada – “prepare for wildfire.” On the flood file, 1.5 million households in Canada, or 10 per cent of the housing market, are no longer eligible for flood insurance. With the average cost of basement flooding in Canada at $54,000, the strain on homeowners with no insurance mounts.

Insurance impacts are not restricted to the property and casualty sector; for life and health insurers, research is under way to quantify potential spikes in claims for psychosocial impacts, counselling services and lost time from work following wildfires and flooding.

What is the optimal ratio of investment dollars dedicated to mitigation and adaptation? The Insurance Bureau of Canada suggests an amended ratio of 50:50, or $5.3-billion directed to adaptation, annually, for each of the next six years – this would enable Canada to fulfill its commitment to meeting its NAS targets and limit the impacts of wildfires and flooding that dominate headlines.

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