Harvey to cost Texas $58 billion in losses: Report

Harvey to cost Texas $58 billion in losses: Report

HOUSTON
Harvey to cost Texas $58 billion in losses: Report

Economic losses in Texas from Hurricane Harvey, which is still pounding the water-logged US state with rain, will be some $58 billion (49 billion euros), disaster analysts in Germany said on Aug. 31.

If that estimate holds, it would make Harvey the world’s 9th most expensive natural disaster since 1900, according to the Center for Disaster Management and Risk Reduction Technology (CEDIM) in Karlsruhe, Germany.

It would also push the yearly economic loss from earthquakes, floods, tsunamis, cyclones and other natural cataclysms past $100 billion for the 8th year in a row.

“The damage is extensive at around $58 billion, and is over 90 percent due to flooding,” said James Daniell, senior risk engineer at CEDIM, and head of its Forensic Disaster Analysis Group.

The estimate carries uncertainty range from $41 billion to $80 billion.

“Depending on the next couple of days, we may see this estimate rise, as it only includes Texas at this point,” he told AFP.

The total “flooded exposure” - the value of all the capital stock inundated by water, whether five centimeters or five meters - in the affected area was estimated at $267 billion.

Other calculations of total economic loss have been considerably lower.

German insurance giant Hannover Re’s initial figure for damages was $3 billion, while JP Morgan estimated the insurance sector could be out $10-20 billion.

Disaster risk specialists Enki Holdings, based in Savannah, Georgia, put the total tab at above $30 billion.
The CEDIM estimates are based in part on the largest database of natural catastrophes in the world, covering over 41,000 events since 1900.  

They also reviewed new TerraSAR-X satellite data, which indicates a flood “footprint.”

To measure the region’s risk exposure, Daniell and his team used data from the U.S. Bureau of Economic Analysis, which tracks investment.

“But we also checked that against building and replacement cost data,” Daniell said. “That’s usually the issue with a lot of other models - they don’t get the exposure right.”

Total capital stock in Texas is about $4.5 trillion, and for the entire United States the figure is about $56 trillion, he said.

The natural disaster with the highest economic costs -- $218 billion was the 2011 Tohoku earthquake, which generated a monster tsunami that devastated a large swathe of Honshu Island and crippled a nuclear power plant.

In second place is the earthquake that levelled part of China’s Sichuan Province in 2008 ($162 billion), followed by Hurricane Katrina, which destroyed much of New Orleans in 2005 ($160 billion).   

Harvey weakened as it moved inland over Louisiana on Aug. 31, leaving behind record flooding that drove tens of thousands from their homes in Texas.

The death toll was rising as bodies were found in receding waters. 

The storm has killed at least 35 people and forced 32,000 people into shelters since coming ashore on Friday near Rockport, Texas, on the Gulf of Mexico Coast. It was the most powerful hurricane to hit the state in half a century.

The Houston Fire Department will begin a block-by-block effort on Aug. 31 to rescue stranded survivors and recover bodies, Assistant Fire Chief Richard Mann told reporters.

“Our whole city is underwater,” said Port Arthur, Texas, Mayor Derrick Foreman in a social media post where he also  broadcast live video of floodwaters filling his home in the city of 55,000 people.

Two explosions at Texas chemical plant

Local emergency officials reported on Aug. 31 two explosions at a flooded chemical plant in the Texas town of Crosby, its operators Arkema Inc said.

“At approximately 2 am CDT (0700 GMT), we were notified by the Harris County Emergency Operations Center (EOC) of two explosions and black smoke coming from the Arkema Inc plant in Crosby, Texas,” the company statement said.

As a precautionary measure officials had already ordered the evacuation of an area within 3 kilometers of the organic peroxides plant, which operators had said was at risk of exploding due to a “critical issue” triggered by monster storm Harvey’s torrential rains.

The facility had been evacuated following a dangerous loss of on-site refrigeration.

In its statement, the company said: “unprecedented flooding overwhelmed our primary power and two sources of emergency backup power.”

The facility manufactures compounds with a broad array of commercial uses including plastics, pharmaceuticals and construction materials but which can combust if not cooled to the proper temperatures.

“Organic peroxides are extremely flammable and, as agreed with public officials, the best course of action is to let the fire burn itself out,” Arkema said.

“We want local residents to be aware that product is stored in multiple locations on the site, and a threat of additional explosion remains. Please do not return to the area within the evacuation zone until local emergency response authorities announce it is safe to do so.” 

Crosby lies about 40 kilometers northeast of Houston.