Consider, as one colorful example, the skiing industry. Beginning 10 years ago, the Aspen Skiing Company began noticing that European ski lodges were being slowly destroyed by warmer weather. Europe's ski resorts tend to be located on lower mountains—about 6,000 to 8,000 feet high, compared to American peaks up around 11,000 feet—so they're vulnerable to even extremely tiny increases in global temperature. The 2 percent rise in the 20th century was enough "to put a lot of them out of business," says Auden Schendler, executive director of sustainability for the Aspen Skiing Company, which operates two resorts spread across four mountains.
But now Aspen's own season is getting shorter: "More balmy Novembers, more rainy Marches," Schendler says. "That's what we're seeing, and that's what the science suggests would happen. If you graph frost-free days, there are more and more in the last 30 years." Climate-change models also predict warmer nights. Aspen Skiing has noticed that happening too, and the problem here is that nighttime is when ski lodges use their water-spraying technology to make snow—"and if you make it when it's warmer it's exponentially more expensive." The increasing volatility of weather overall—another prediction of climate change—poses a particular danger for ski resorts, because they operate in the red most of the year, making up their deficit during the ultra busy spring break in March. So if the weather is terrific for the entire winter but suddenly balmy during March break, that can ruin the whole fiscal year.
Schendler has also learned firsthand a point that climate scientists have been making for some time: With climate change, "warming" isn't the only—or even the most serious—challenge. The sheer interdependence of complex ecosystems systems can grease you. For example, recent droughts in Utah have kicked up red dust clouds that settle on Aspen's snow. This makes the snow melt more quickly (because the red absorbs more heat from the sun) while also making it too gritty to ski on.
Are all Aspen Skiing's recent weather problems caused by global warming? It's impossible to tell. But as Schendler notes, the last few years certainly mimic the precise effects that climate models predict, so it is at least a taste of what's to come. During a recent dust storm on Aspen's slopes, Schendler's boss wandered into his office looking morose. "He said, 'Auden, if climate change is the scary thing for the future, this is the apocalypse now. What if you get this in March?' '' Schendler recalls.
Now, all this tricky weather hasn't exactly destroyed Aspen Skiing; the firm could probably survive even worse stuff. The top of the mountain is so high "we can ski it in 50 years and it'll be great," Schendler notes. But it could certainly erode Aspen's profits, and Colorado would suffer: The ski industry overall is a $2 billion business for the state, employing fully 8 percent of the workforce. So to try to preserve its profit margins, the Aspen Skiing Company has recently become a loud voice in favor of congressional action on the climate. In 2007, Schendler testified before the House Subcommittee on Energy and the Environment, calling for a cap on carbon emissions—among other things.
"Our attitude when we go to Congress is, look, we're a business!" he adds. "We didn't ask for this. We just started looking at the data and the science dispassionately and said, look, we've got a problem."
Another industry that can't pretend climate change is a myth is insurance. Insurance firms have always carefully studied real-world data to figure out what, precisely, constitutes a risky activity. As a result, they were among the first to notice that weather was getting more violent, and more unpredictably so.
"It's just a logical consequence," says Peter Hoppe, head of the "Geo Risks Research" division of Munich Re, the multinational reinsurance firm. "Global warming affects our core business. We have seen changes already in some readings." Worldwide, Munich Re has found that "great catastrophes"—act-of-god weather events that cause more than $1 billion dollars of damage— have tripled since 1950. In 2008, even though there weren't any Katrina-level disasters, weather-related events were so severe that "catastrophic losses" to the world's economy were the third-highest in recorded history, topping $200 billion globally—including $40 billion in the United States. Hoppe doesn't think global warming is all to blame; some of these events are likely due to natural cycles like the 30-year "North Atlantic Oscillation" that is currently warming the Atlantic. But Munich Re's policy is that anthropogenic global warming is already making things worse and that governments ought to act quickly while they still can.
Granted, a warming globe isn't just downside for insurance firms. There are also profitable new business opportunities, as Hoppe points out. Munich Re is now offering coverage for renewable energy products, because wind farms and solar parks need insurance against the possibility that low wind and weak sunlight will reduce their output. "It's very important for investors to dampen and level out the volatility from season to season," Hoppe says. Munich Re has also developed a product to cover solar cells that wear out before their expected 30-year lifetime.
Buying insurance against bad weather isn't entirely new. Farmers have done it for years. But back in the late '90s, before Enron imploded, it created a huge new market of selling "weather futures" to electric utilities—hedges that would pay out if, say, a mild summer hurt their sales (because people would use less air conditioning.) After Enron pancaked, weather futures stayed around—still mostly for utilities and farms—but buying them wasn't easy: You had to personally contact one of the few weather-futures traders who'd set up their own trading desks in the wake of Enron's dissolution. But with climate-change models predicting increasingly erratic weather, a new generations of startups is heading into the field, figuring that almost any firm might want to hedge against the bad economic effects of weather—such as clothing manufacturers (who could suffer massive losses in coat sales if an unexpectedly mild winter emerges) airlines (since weather is the top cause of delays) or sporting-event promoters (when it's rainy, everyone stays away).