The Hidden Ocean Cost Behind Climate Change

For decades, policymakers, investors, and economists have relied on the social cost of carbon (SCC) to understand the economic harm caused by each ton of carbon dioxide emitted into the atmosphere. This single number influences regulations, carbon markets, climate policy, and corporate risk assessments. But according to groundbreaking research from Scripps Institution of Oceanography at UC San Diego, we’ve been missing something enormous—the ocean.

And once the ocean is properly accounted for, the true cost of carbon pollution almost doubles.

Published January 15 in Nature Climate Change, the study introduces the “blue social cost of carbon”—the first comprehensive attempt to calculate the monetary damage climate change inflicts on marine ecosystems, fisheries, coastal communities, and the billions of people whose well-being is tied to healthy oceans.

The findings reset the way we think about climate risk. They also reveal just how incomplete our economic models have been.

The standard SCC already captures wide-ranging climate harms—flooding, drought, lower crop yields, wildfires, disease, and more. But the ocean, despite covering 70% of Earth’s surface, has remained largely invisible to decision makers.

Lead author Bernardo Bastien-Olvera explains why:

“If we don’t put a price tag on the harm that climate change causes to the ocean, it will be invisible to key decision makers.”

Many ocean impacts—coral reef collapse, mangrove loss, declining fisheries, or the intrinsic value humans place on marine biodiversity—don’t have clear market prices. Without a market signal, traditional economic models simply ignored them.

This study changes that.

Human-generated CO₂ doesn’t just warm the atmosphere. Much of that heat is absorbed by the ocean, where it drives cascading impacts:

• Warmer waters that bleach coral reefs and disrupt species distribution
• Ocean acidification that weakens shells, fisheries productivity, and food chains
• Lower oxygen levels, threatening species survival
• Stronger storms and surges, damaging ports, infrastructure, and coastal property
• Loss of mangroves, seagrass, and kelp forests, which protect coastlines and support fisheries

These changes affect trade, food security, tourism, recreation, and the ecological balance of entire regions.

To calculate the blue SCC, researchers incorporated three categories of ocean-related losses:

Impacts with direct economic consequences—including:

• Reduced fisheries revenue
• Losses to global trade
• Coastal infrastructure damage

Projected cost:
$1.66 trillion per year by 2100

Losses that affect human well-being, such as:

• Reduced nutrition due to lower seafood availability
• Lost recreational opportunities (diving, snorkeling, beaches)

Projected cost:
$182 billion per year

The value humans place on simply knowing ocean ecosystems exist—coral reefs, mangroves, marine biodiversity—even if we never directly use them.

Projected cost:
$224 billion per year

When these categories are added, the SCC jumps from:

Given 2024’s global emissions of 41.6 billion tons, the model implies nearly $2 trillion in ocean-related climate damages for a single year.

Two trillion dollars—hidden in plain sight.

Not all regions bear the same cost.

The study finds small islands and low-income coastal economies are hit disproportionately hard. Many rely heavily on seafood for essential nutrients like protein, omega-3 fatty acids, iron, and calcium. As warming waters reduce nutrient availability, these populations face elevated health risks—including increased disease and mortality tied to nutrient deficiencies.

For these communities, ocean degradation is not abstract. It is a direct threat to survival, food security, cultural identity, and economic future.

The blue social cost of carbon matters because the SCC is a tool used everywhere—regulation, permitting, public investments, climate planning, ESG risk, and corporate capital allocation.

As co-author Kate Ricke notes:

“Protecting the environment can have high up-front costs, so we need methods for thinking about the trade-offs we are making as a society.”

Without ocean impacts included, those trade-offs have been biased—systemically underestimating the benefits of climate action.

By incorporating blue SCC:

• Governments can design more accurate regulations
• Corporations can more responsibly manage carbon risk
• Investors can better price transition and physical climate risk
• Sovereigns and development agencies can prioritize adaptation support for vulnerable regions

For climate decision makers, this is not just another academic paper. It is a recalibration of the compass.

Climate change is a systems problem. Every ton of carbon emitted causes harm somewhere—on land, in the air, and now, clearly, in the ocean. This study exposes the blind spot in traditional climate economics and provides a more holistic view of the true cost of our emissions.

In doing so, it strengthens the economic case for:

• Faster decarbonization
• Stronger ocean protection policies
• Investments in coastal resilience
• Climate-aligned capital markets
• Better governance frameworks that internalize externalities

As Bastien-Olvera puts it:

“When an industry emits a ton of carbon dioxide into the atmosphere, we are paying the cost as a society.”

The blue social cost of carbon makes that cost visible—and impossible to ignore.

Dr. Cezhan Ambrose is a Post-Doctoral Research Fellow at Pepperdine University’s Graziadio Business School, where his research focuses on corporate governance, environmental sustainability, and the financial materiality of board-level decisions. He is the founder of EnviroGov Solutions, a governance-first sustainability platform developing data-driven investment products such as the EnviroGov 50 ETF. His work integrates systems dynamics, ESG analytics, and capital-markets research to help organizations and investors navigate the transition to a low-carbon economy.