Page - 359 - in Loss and Damage from Climate Change - Concepts, Methods and Policy Options

14 IntegratedAssessment for IdentifyingClimateFinanceNeeds… 359 14.5.2 TimeHorizonandL&DEstimates Withrespect to the timehorizon thefollowingpointsare relevant: IAMscanhelp to provideanorderofmagnitudeestimatefortheresourcesthatwillbenecessarytomeet lossesanddamagesestimates, but abottom-upsector-by-sector analysisof existing andprojectedlosseswillbenecessary.Thechallengeistolinkthetwoapproaches.At presentwehavetheIAManalysis thatdrawsonthebottom-updata inarathercrude way. The current bottom-up analysis for sectors such as agriculture, health etc. is moredetailedbutdoesnotgenerally takeaccountof theoveralleconomicprofilefor the country or region. Uncertainty regarding future damages from climate change is very large in the long-term (2050–2100), especially if some tipping-points are crossed,butmoremoderateinthenear(2020–2030)andmedium-term(2030–2050). Thus, the longer the timehorizonbeingconsidered thegreater theuncertaintyabout the possible level of Loss and Damage. Some of these uncertainties are reduced significantly whenmitigation is undertaken but also through adaptation. Previous sections show that low emissionmitigation pathways can reduce future damages remarkably and their uncertainty range, and that adaptationmeasures can reduce residualdamages. InviewofthesefactsoneofthefirstobjectivesintheneartermisforaL&Dfinance mechanism to get establishedwith the sufficient amount ofmonetary resources to cover thecurrent existing lossesdirectlyattributed toclimatechange (not tonatural variability). In themediumand the long term, it is important that thecurrentdesign offinancingmechanism isflexible enough inorder to scale up thefinancing if and whennecessary. 14.6 Conclusions The aim of this chapter has been to see howmuch we can learn about possible losses anddamages- andfinanceneededbyemploying economic IAMs,which are key analytical tools at the heart of economic analysis of the damages caused by climatechangeandofeconomicallyoptimalresponsestothesedamages.Weinterpret modelled residualdamagesasunavoidedL&D. The current state of knowledge about damages hasmany gaps andwe are not by anymeans at a stage where the results of thesemodels can form the basis of financial packagesofLoss andDamage.On theother hand, a few results standout as relatively robust and credible, andprovide a useful contribution to theLoss and Damagedebate. ThefirstisthatresidualdamagesturnouttobesignificantunderavarietyofIAMs, and for a range of climate scenarios. This means that if adaptation is undertaken normally, therewill remain a large amount of damage that is not eliminated. The figuresforthatdamagevarybyregionandsectorandprovideausefulsourceoflikely financialneeds.Second the ratioofadaptation to totaldamagesvariesby region, so