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A new report estimates that climate change could cost Minnesotans more than $20 billion a year by 2040, if global greenhouse gas emissions continue to rise and the state doesn’t take action to adapt to a warmer climate.

Those costs include medical treatment for illness from extreme heat and air pollution, repairing damage to roads and buildings from floods, lost crop productivity and an increase in invasive pests that affect recreation, fishing and forestry. 

“These impacts cross economic sectors and affect the day-to-day lives of Minnesotans,” the report states. The report estimates that without action, annual climate costs could reach almost $50 billion by the end of the century.

The key message is that “climate change is expensive. It's already impacting Minnesota, and it will continue to be more expensive,” said Katrina Kessler, commissioner of the Minnesota Pollution Control Agency, which produced the report.

“Those costs will be borne by individuals, business owners, farmers, local governments — these are the people who are going to end up paying for it,” Kessler said.

The report found that the cost of inaction far exceeds the cost of climate adaptation measures, such as adding air conditioning to homes, schools and public buildings; upgrading roads and bridges; and planting more resilient crops. It estimates those actions could cost as much as $3.8 billion a year by the end of the century.

The report looks at five categories of costs: health, agriculture, transportation and electricity infrastructure, buildings and ecosystems. It estimates that taking steps to adapt to climate change is eight to 15 times less expensive than the costs of future climate change. 

The Legislature directed the MPCA in 2024 to evaluate the costs associated with climate change impacts and resiliency. The agency contracted with state and national economic climate experts and the University of Minnesota Climate Adaptation Partnership to produce the report.

The report is based on modeling and assumptions, and it shouldn’t be taken as an exact calculation, Kessler said. If anything, it’s likely a conservative estimate that doesn’t fully capture all climate-related costs, she said. 

However, “it is our responsibility to try to put our best guess forward at this moment, so that we can maximize the investments we're making today towards a resilient future for all of Minnesota,” Kessler said.

One of the biggest costs of climate change is the health impacts from extreme heat and wildfire smoke, which probably doesn’t surprise Minnesotans, said Kate Knuth, climate director at the MPCA.

“We've all experienced, unfortunately, some really bad, poor air quality summers because of wildfire smoke, and the health impacts of that are pretty significant,” she said. “So I think that day-to-day impact on people's lives is going to become more and more obvious.”

Last month, Minnesota released an update of the state’s Climate Action Framework, a blueprint that guides how the state plans to reduce greenhouse gas emissions and meet its climate goals. 

Kessler said she hopes the climate adaptation report will help spark conversations about what people can do in their own homes and communities to increase climate resilience, such as planting trees and reducing food waste.

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Kirsti Marohn

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The Minnesota Pollution Control Agency report found that the costs of inaction, including health effects and damaged infrastructure, far exceed the cost of climate adaptation measures.

Report: Minnesota to see billions in costs from impacts of climate change

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