Monica Grasso

For Monica Grasso, chief economist at the U.S. National Oceanic and Atmospheric Administration (NOAA), climate change is not just impacting the physical environment, but also our social and economic structures. In a testament to this belief, last year Grasso authored an economics chapter for the government’s Fifth National Climate Assessment—the first-ever chapter to focus on the monetary losses attached to the impacts of climate change. And it won’t be the last. Grasso says a similar chapter will be included in the Sixth National Climate Assessment, set to publish in 2026.

A key goal of this analysis is informing the public and business sectors alike on how extreme weather events, temperatures, and rising sea levels can, have, and will impact the economy; her climate assessment chapter estimates that weather-related disasters currently generate at least $150 billion per year in direct damages and will slow GDP growth.  

It's not just about financial losses though. There are economic opportunities too in tackling climate change. When visiting New York City for Climate Week this September, Grasso realized just how much people want to invest in climate mitigation, but that they need data to understand where and how their investments could be most effective. More data—on everything from flood to wildfire risks—can “empower” people to make an impact, says Grasso. “That’s why, ultimately, we want to be able to understand the implications of climate to financial stability.” 

Soon after the chapter was published, in March 2024 the Department of Energy announced a $6 billion investment in 33 projects to decarbonize energy-intensive industries, reduce industrial greenhouse gas emissions, and revitalize industrial communities. And in August, NOAA announced that through the Bipartisan Infrastructure Law and Inflation Reduction Act, they are restoring coastal habitats impacted by climate change in order to increase the resilience of coastal communities.

The chapter also discussed how the economic effects of climate change are unequally distributed across demographics, something Grasso is continuing to research at NOAA. Pointing to the recent Hurricane Helene, Grasso notes that many houses destroyed in North Carolina were without insurance. “The issue is that we are all subject to climate, but if you don't have ways to adapt quickly, the impact is going to be much higher.”