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Is climate change a curse of industrialization or an opportunity? This book has presented a case for the latter, arguing that a proactive approach to mitigation and adaptation will present a new generation of opportunities for innovation and growth. However, California is at present woefully unpreparedto adapt to a changing climate. Its political and institutional cultures evolved in an era of low climate variability. To adapt to sustained higher climate variability, state agencies will need to increase their competency and rethink the way in which they plan, allocate resources, and interact.

Climate change portends dramatic adjustments to our natural world and the way we live in it. In California, many of the challenges of adapting to a changing climate are institutional, requiring better information, determined policymaking, and more adaptive institutions, but California's current political culture and system of public administration are not well suited to a warmer and more variable climate. Even as it creates new challenges, however, climate change will present opportunities for leadership by a state that has established itself as a global leader in knowledge-intensive innovation.

A changing climate creates both economic risks and rewards, but these are very uncertain and are spread unevenly across space, time, and society. Climate-change adaptation thus presents complex issues of political economy. This chapter discusses five dimensions of this political economy: uncertainty, costs, timing, fairness, incentives, and institutions.

Climate change is expected to present a wide range of challenges to California agriculture, forestry, and fishing, some of which (e.g., CO₂ fertilization) are expected to be positive, while others (e.g., heat stress on livestock) will be unambiguously negative. As this chapter makes clear, there is no consensus yet on whether the net impacts at lower levels of warmingwould be largely positive or negative, though there is agreement that they would be uneven across crops and regions. In principle, agriculture and forestry could be highly adaptive and resilient, but increasing adaptive capacity will require striking a better balance between private-sector adaptation and public-sector research and extension assistance.

California's economy, society, and institutions have evolved with the politics of water. Similarly, many of the most challenging aspects of climate adaptation will arise from impacts on allocation of the state's water supplies. The ongoing failure to reconcile competing water interests in the Sacramento–San Joaquin Delta is but one ominous precedent in this regard. This chapter discusseshow climate change might affect California's water supplies;it also discussesthe role of public-sector leadership in determining whether less expensive, less capital-intensive adaptation solutions (e.g., water trading) can be deployed before more expensive, more capital-intensive ones (e.g., desalination) become inevitable.

Many components California's energy system, including conversion, distribution, and use, are vulnerable to climate change. In this chapter, we focus on the two most prominent of these:reductions in hydropower generation due to changes in water availability and increased demand for electric air conditioning due to rising temperatures. Through these two examples, the chapter illustrates how the adaptation and mitigation agendas overlap, why interagency coordination is required to address these overlaps, and how choice of business and regulatory models for the energy sector will influence adaptive capacity in the energy sector.

Climate change is of critical importance to the future of transportation in California. It is obvious that climate and weather have large potential impacts on transportation systems. In addition, decisions about transportation infrastructure arevery long-lived; bridges, for instance, can last for more than one hundredyears. These two facts illustrate the importance of integrating adaptation into transportation planning processes. This chapter discusses two of the most important climate impacts on transportation systems—sea-level rise and changes in storm frequency and intensity—and shows how addressing these two impacts will require proactive, well-functioning planning across a large and diverse network of agencies.

At lower levels of warming, climate change could have both positive and negative impacts on California's tourism and recreation industry. Some summer activities (e.g., golf) could see benefits, while winter sports (e.g., skiing) could see severe negative impacts. Even within activities (e.g., beachgoing) the impacts could be very uneven, with some beaches gaining traffic and others losing. This inequality of impacts, as well asthe dependence of many communities in California on tourism, raises important questions about what level of resources the state should invest to protect the current tourism industry (e.g., beach nourishment) versus allowing communities and businesses to adapt on their own to changing natural conditions. As the book emphasizes repeatedly, public and private burden sharing will be a critical dimension of adaptation strategies.

For California, asfor most of the developed world, property values are the largesteconomic climate risk.The extent of this risk and the allocation of exposure depend on how much property is located in high-risk areas decades into the future. Insurance can play an important role in mitigating and allocating property risks, implicating both the financial-sector and state policies that affect developer and homeowner decisionmaking (e.g., public fire-insurance programs, floodplain-development restrictions).This chapter examines three of the main threats of climate change to property—wildfires, sea-level rise, and storms and flooding—and the risk they pose to real estate. We also consider the central role of public (state and federal) agencies in facilitating adjustment to climate risk that is both cost effective and more equitable.

Globally, impacts on public health may be one of the most important consequences of climate change. In California, which already has a robust public-health system, these impacts are expected to be less dramatic.Nonetheless, climate change is expected to increase public-health challenges in Californiaand to create new ones. This chapter examines two of the most important challenges—tropospheric ozone control and heat waves—and discusses how mitigation and adaptation efforts related to public health overlap, why managing this overlap requires interagency coordination, and the importance of targeting adaptation efforts.