Throughout 2022, California was in a severe drought. Up and down the state, most counties had received only a smattering of rain during the prior winter–on average only about 25% of their usual totals. Water reservoirs, already depleted, drew critically low. While the rest of the country slogged through sleet and snow, California–one of the richest breadbaskets in the world–continued to suffer from its record-breaking drought. And then, on New Year’s Eve, the atmospheric river arrived.
The Atmospheric River, Explained
For the first three weeks of 2023, a treadmill of storms battered all 840 miles of California’s coast. The deluge of water transformed dry creek beds into diluvial torrents–downing trees, flooding properties, and taking lives. Dubbed an “atmospheric river,” such a meteorological event occurs when warm, moist air from the subtropics rises into the atmosphere and becomes transported by extratropical cyclones, creating a conveyor belt of airborne water.
Atmospheric rivers are nothing new in California. The western half of the Pacific Ocean oscillates between El Niño and La Niña years, usually causing California and neighboring regions to receive wetter winters in El Niño years and dryer, milder winters in La Niña years. But what was new was this storm’s intensity, and how quickly California went from having too little water to having too much. Adding to the intrigue is the fact that 2022 was not classified as an El Niño year. At the time of this writing, the La Niña cycle is not expected to transition until later in 2023.
How a Warming Planet Drives Weather Volatility
As the planet warms, the oceans retain more heat. Hotter oceans mean more evaporation, increasing the amount of water vapor available for rainfall. Additionally, as the atmosphere warms, its carrying capacity for water vapor increases, too. That relationship helps explain why California’s 2023 atmospheric river California was wetter and more intense than usual.
But climate change doesn’t just make certain weather events, like hurricanes, floods, or atmospheric rivers, more intense. It also makes certain meteorological patterns more volatile. In other words, the dry periods are longer and dryer, while the wet months are shorter and wetter.
Volatility–which can be defined colloquially as higher highs and lower lows–wreakes all sorts of havoc for the natural and the human world. Flash floods, for example, occur when dry creek beds, arroyos, culverts, and other hardened surfaces receive too much water too quickly. The soil does not have time to absorb the excess water, and thus, more water remains on the surface. Even if the total volume of water is less than comparable precipitation events, the rate of precipitation can overflow rivers, flood roads and houses, and overwhelm sewage and drainage systems.
Moisture Flows and Financial Flows
Obvious linkages exist between finance and the weather. At the most basic level, more extreme and more volatile weather costs society more money. California’s 2023 atmospheric river has already caused millions of dollars in property damage and has tragically taken 18 lives. Historically, atmospheric river events have incurred billions of dollars of damage on the West Coast of the United States.
However, there is another link between disastrous meteorological events and the financial world. Capital flows into new industries, helping make new technologies or helping grow new markets. But sometimes, those productive investments come with harmful externalities. Investment in fossil fuels is a textbook example. While the emergence of fossil fuels has no doubt helped usher in the modern age, e.g., by revolutionizing automobile and airline travel, making electricity cheap, and powering decades of manufacturing, their use has also brought air pollution, conflict, and, ultimately, irreversible climate change.
Since the Industrial Revolution, hundreds of trillions of dollars have been invested in the development and extraction of fossil fuels. Even in the four years immediately following the Paris Agreement of 2015, sixty major banks invested over $3.8 trillion into the fossil fuels industry. Compare that figure to the amount invested in renewables over the same time period: $246 billion, or less than 6.5% of the amount invested into fossil fuels. For a planet that is warming precipitously, that ratio is too far out of balance.
To remedy volatile hydrological flows, we can start by remedying our errant capital flows. Firn is on a mission to do just that. By creating a one-stop shop for sustainable investments, Firn enables everyone to direct capital investment into renewable energy, storage, and distribution. In time, Firn aspires to find investment opportunities in other areas of sustainability, like climate adaptation. Together, you can save for your rainy days without worrying about making them worse.