![\"\"](\"https:\/\/reneweconomy.com.au\/wp-content\/uploads\/2026\/03\/leitch_1.jpg\")
<\/a><\/p>\nFigure\u00a01: image-20260310114306615<\/p>\n
Queensland is more or less actively encouraging more disasters in Queensland via coal and gas investment and this, along with what the rest of the world is doing, means that \u201cprepare and repair\u201d will continue to offer investment opportunities.<\/p>\n
Mining in total represents about 13 per cent of gross state product (GSP) and coal mining is probably half that. Even at the new royalty rates it\u2019s 6% of government revenue. <\/p>\n
But sectors exposed to increasing disaster costs represent about 20% of GSP. There are about 50,000 jobs in coal mining compared to about 300,000 jobs in agriculture, tourism and accommodation alone that are negatively exposed to disasters in Queensland.<\/p>\n
Figure\u00a02: Queensland\u2019s drought-flood cycle in numbers<\/p>\n Overall, employment might increase due to construction and rebuilding \u2013 call it the permanent tradies effect. This is the \u201cbroken window fallacy:\u201d Disasters are good for some sectors of the economy but destroy wealth and the overall impact is negative.<\/p>\n To emphasise the point. look at the consumer price index (CPI) increases over the past 10 years. Electricity doesn\u2019t appear, but petrol and gas do. More to the point, insurance is the biggest increase outside of tobacco. <\/p>\n Disasters are becoming more expensive and protecting against them is also becoming more expensive.<\/p>\n Figure\u00a03: CPI top categories<\/p>\n Where to invest?<\/p>\n Based on the Bloomberg Prepare and Repair Index \u2013 an index of eight US sectors that have outperformed the S&P 500 by 6.5% a year over the decade to October 2025 \u2013 the best likely investment areas in Queensland are:<\/p>\n \u2013 Industrial services: In QLD, likely general contractors, tradies, infrastructure rebuilders;<\/p>\n \u2013 Stormwater construction: For example,\u00a0whoever owns concrete and plastic pipes and their installers, e.g.\u00a0James Hardie;<\/p>\n \u2013 Insurance brokers: Premium growth from rising risk;<\/p>\n \u2013 Equipment rental: For example\u00a0portable accommodation, mobile homes;<\/p>\n \u2013\u00a0Restoration: Road contractors, fencing rebuilders;<\/p>\n \u2013\u00a0Infrastructure engineering: Flood defences, toughening up electricity transmission, etc;<\/p>\n I\u2019d also add marine ecology; reef repair, although exactly how you repair a reef I haven\u2019t worked out. But there has to be a way to make money out of it. Maybe an aqua museum\/resort?<\/p>\n No reliable disaster cost data<\/p>\n The Australian Bureau of Statistics (ABS) has acknowledged<\/a> the lack of a good national disaster cost database. There is no regularly updated, comprehensive measure of Australia\u2019s total natural disaster costs. <\/p>\n It is surprising how poorly the economic costs of disasters are reported. There is endless climate change analysis but little about its day-to-day economic impacts. <\/p>\n This note draws on the Deloitte\/IAG estimates and the ICA Catastrophe Database (which only captures 20\u201350% of total economic cost). Since disaster costs are likely to increase, and Queensland provides the greatest exposure, it would seem sensible for governments to maintain a trusted and reliable source of truth on the costs.<\/p>\n Queensland\u2019s economic growth: about 3%, moderating<\/p>\n Queensland\u2019s long-run average real GSP growth is approximately 3.0\u20133.5 per cent per annum, moderating to 2.5\u20132.75 per cent through 2028\u201329 (QLD Budget 2025\u201326). In 2010-11, floods and Cyclone Yasi reduced growth to 0.2 per cent \u2013 approximately 2-3 percentage points below trend, implying $5-8 billion in foregone output on top of direct damage costs.<\/p>\n 13% of Queensland\u2019s economy is directly exposed to climate disasters<\/p>\n GSP equals total gross value added (GVA) plus net taxes on products; in Queensland the two measures are close.<\/p>\n SectorGVA ($B)% of GSPKey Climate RisksAgriculture, Forestry and Fishing~16.7~3.5Drought, flood, heat stress, cyclonesTourism (direct GVA)15.73.1Coral bleaching, cyclones, heatwavesTransport and Warehousing~22.0~4.6Road\/rail flood damage, cyclone closuresAccommodation and Food Services~11.0~2.3Cyclones, floods, bushfires, also a beneficiaryTotal (high exposure)~66~13<\/p>\n Source: QLD Treasury, ABS State Accounts, Tourism Research Australia. Including mining (12.9% of GVA, moderate exposure) brings the total to ~26% of GVA.<\/p>\n These are not marginal sectors. Queensland agriculture produces almost one-quarter of Australia\u2019s total agricultural output (cattle $6B, sugarcane $2B). Tourism contributes $32 billion to GSP when indirect effects are included (6.3% of total GSP). The Great Barrier Reef alone supports 77,000 FTE jobs.<\/p>\n Historical Disaster Costs: $50-70 Billion<\/p>\n The total economic cost of major flood, cyclone, and drought events in Queensland since 2010 is conservatively estimated at $50\u201370 billion:<\/p>\n CategoryEstimated CostBasisRoad and public infrastructure (QRA managed)$29 billionCumulative 2011\u20132025Emergency water infrastructure (Millennium Drought)$6.9 billionSEQ Water Grid, desalinationLivestock losses (2019 + 2025 floods)$6+ billionDeloitte $5.68B for 2019 aloneUninsured property and business losses$5\u201310 billion30\u201350% insured-to-total cost ratioAgricultural production losses$3\u20134 billionQLD share of $1.1B\/year national lossGovernment drought assistance$670 millionSince 2013<\/p>\n Source: QRA, Deloitte Access Economics, ABARES, ICA, QLD Government. Categories overlap.<\/p>\n The trend: accelerating<\/p>\n MetricValueQRA active program, first 5 years (2011\u201316)~$15 billionQRA active program, latest 5 years (2020\u201325)$14.2 billion across 58 eventsEvents activated 2024\u20132517 (highest on record)LGAs activated 2024\u20132573 of 77 (most widespread ever)<\/p>\n National disaster costs have risen from an estimated $18 billion in 2017 to $38 billion in 2024. Queensland experiences roughly 60 per cent of the nation\u2019s disaster events and bears a disproportionate share of the cost (Climate Council, 2024; Deloitte Access Economics, 2024; Insurance Australia Group, 2024).<\/p>\n Major events since 2010<\/p>\n EventYearTotal Economic Cost ($B)Insured Losses ($B)QLD Floods + TC Yasi2010\u201311~14.13.5TC Debbie2017~3.51.74NQ Monsoon Trough2019~5.681.24SE QLD Floods2022~7.75.56TC Jasper2023~1.00.74Ex-TC Alfred2025~1.8\u20132.71.5<\/p>\n Source: ICA, Deloitte Access Economics, QRA, World Bank.<\/p>\n The gap between insured and total economic costs falls on individual property owners, businesses, and taxpayers through government recovery programs.<\/p>\n Disaster costs are about 1% of GSP and probably rising<\/p>\n Historical ratio<\/p>\n Period \/ EventDisaster Cost ($B)QLD GSP ($B)Cost as % of GSP2010\u201311 (floods + Yasi)~16~275~5.8%Annual average (total economic, 2011\u201325)~4\u20135~400 (avg)~1.0\u20131.3%2022 (SE QLD floods)~5+~425~1.2%Annual average (QRA program only)~2.1~400 (avg)~0.5%<\/p>\n Source: Author calculations from Deloitte, QRA, ICA, World Bank, ABS.<\/p>\n The ongoing burden of approximately 1.0-1.3 per cent of GSP is substantial. In the extreme year of 2010-11, disaster costs consumed the equivalent of almost 6 per cent of GSP.<\/p>\n The forward projection<\/p>\n Rather than rely on the Deloitte model, which has not been fully updated since 2021, we can build a projection from the more current ICA data. National insured disaster losses have more than doubled in recent years, from a 30-year average of $2.1 billion to $4.5 billion over the past five years (ICA).<\/p>\n Applying Queensland\u2019s share (~40\u201350% of national insured losses) and standard multipliers for uninsured and indirect costs (2\u20133x), current total economic disaster costs for Queensland are approximately $5 billion per year \u2013 roughly 1 per cent of GSP. <\/p>\n If insured losses continue growing at the observed rate of approximately 6 % per annum, Queensland\u2019s total disaster costs would reach $20\u201325 billion per year by mid-century, or about 1.3 per cent of projected GSP.<\/p>\n YearProjected Disaster Cost ($B\/yr)Projected Nominal GSP ($B)Cost as % of GSP2025 (current)~5~531~0.9%2035~9-10~824~1.1%2050~21-25~1500~1.3%<\/p>\n Source: Derived from Deloitte and ICA data.<\/p>\n The ratio increases by about 40 per cent by mid-century. This means disaster costs will grow faster than the economy \u2013 an increasing drag on prosperity. And these are average annual figures; individual extreme years would be substantially worse.<\/p>\n The Climate Trajectory Driving These Costs<\/p>\n Including scope 3 (exported coal and gas burned overseas), Queensland\u2019s carbon emissions are about 660 Mt CO2 or about 1.75% of global total fossil fuel emissions \u2013 117 tonnes per capita, surely one of the world\u2019s highest numbers. Queensland is contributing measurably to climate change, driving its own disasters, and coal and gas production continues to receive policy support.<\/p>\n Climate projections explain why costs are accelerating and are expected to continue doing so.<\/p>\n What is changing<\/p>\n Figure\u00a04: Queensland\u2019s climate trajectory<\/p>\n The drought-flood cycle: quantified<\/p>\n This is Queensland\u2019s defining climate risk. The cycle operates across multiple sectors simultaneously:<\/p>\n Roads: 40 per cent of Queensland\u2019s roads (70,000 km) are on black clay soils that shrink in drought and swell when wet. Drought-weakened pavements suffer accelerated deterioration when subsequently flooded \u2013 documented in peer-reviewed pavement engineering research.<\/p>\n Cattle: The 2013\u20132019 drought forced destocking at ~$68 per head; by 2021, restocking cost $1,500+ per head \u2013 a 20\u201325x price swing. The 457,000 cattle killed in the February 2019 monsoon had been weakened by six years of preceding drought.<\/p>\n Fencing: Exclusion fencing costs have tripled in a decade ($5\u20137k\/km to $15\u201320k\/km). The 2025 floods destroyed 8,500 km of exclusion fencing and 12,000 km of internal fencing \u2013 an estimated $150\u2013250 million to replace. The government has committed $105 million for exclusion fencing alone.<\/p>\n Water: The Millennium Drought drove $6.9 billion in emergency water infrastructure. A further $4-8 billion new desalination plant is planned for 2035.<\/p>\n The climate projections confirm this cycle will intensify: drier winters, more intense rainfall events when they occur, warmer temperatures accelerating evapotranspiration. The net effect is wider swings between extremes.<\/p>\n Queensland\u2019s disaster costs are rising, the climate trajectory ensures they will continue to rise, and the state\u2019s own fossil fuel exports are contributing to the problem. For investors, this creates a structural growth opportunity in the sectors that prepare for and repair the damage.<\/p>\n References<\/p>\n Disaster cost data<\/p>\n Deloitte Access Economics, Building Australia\u2019s Natural Disaster Resilience (2017, updated 2021, 2024). Commissioned by the Australian Business Roundtable for Disaster Resilience and Safer Communities.<\/p>\n Insurance Australia Group \/ Deloitte, \u201cNatural disasters estimated to cost Australia $73 billion per year by 2060\u201d (2024).<\/p>\n Insurance Council of Australia, Insurance Catastrophe Resilience Reports (annual) and ICA Catastrophe Database (1967\u2013present).<\/p>\n Climate Council, State of Queensland: Disaster Ground Zero (2024).<\/p>\n Queensland Reconstruction Authority, Annual Report 2024\u201325.<\/p>\n World Bank, Queensland Recovery and Reconstruction in the Aftermath of the 2010\/2011 Flood Events and Cyclone Yasi (2011).<\/p>\n Economic data<\/p>\n ABS, Australian National Accounts: State Accounts, 2024\u201325 (Cat. 5220.0).<\/p>\n DFAT, Queensland Country Economic Fact Sheet, 2024\u201325.<\/p>\n QLD Budget 2025\u201326, Budget Paper No.\u00a02: Budget Strategy and Outlook.<\/p>\n Tourism Research Australia, State Tourism Satellite Account.<\/p>\n Climate science<\/p>\n CSIRO\/BoM, State of the Climate 2024.<\/p>\n IPCC AR6, WGI Chapter 11: Weather and Climate Extreme Events.<\/p>\n QLD Future Climate Science Program (CMIP6 projections).<\/p>\n ABARES, Effects of Drought and Climate Variability on Australian Farms.<\/p>\n Great Barrier Reef<\/p>\n GBRMPA, Outlook Report 2024.<\/p>\n Deloitte Access Economics, At What Cost? (2024) and At What Price? (2017).<\/p>\n Scope 3 emissions<\/p>\n Climate Analytics, Australia\u2019s Global Fossil Fuel Carbon Footprint (August 2024).<\/p>\n QLD Department of Natural Resources, Coal Industry data.<\/p>\n QLD State of the Environment Report 2024, Greenhouse Gas Emissions.<\/p>\n Insurance<\/p>\n ACCC, Northern Australia Insurance Inquiry Final Report (2020).<\/p>\n CHOICE, Home Insurance Premiums (2025).<\/p>\n Actuaries Institute, The Climate Change Adaptation Gap (2024).<\/p>\n Investment<\/p>\n Bloomberg, \u201cDisaster Recovery Is an $8 Trillion Driver of US Growth\u201d (2025). Bloomberg Prepare and Repair Index.<\/p>\n Data quality<\/p>\n Climate Council. (2024). State of queensland: Disaster ground zero. Climate Council of Australia. https:\/\/www.climatecouncil.org.au\/resources\/state-of-queensland-disaster-ground-zero\/<\/a><\/p>\n Deloitte Access Economics. (2024). Building australia\u2019s natural disaster resilience \u2014 2024 update. Australian Business Roundtable for Disaster Resilience; Safer Communities. https:\/\/www.iag.com.au\/content\/dam\/corporate-iag\/iag-aus\/au\/en\/documents\/report\/iag-reports-deloitte-update-economic-costs-natural-disasters-paper.pdf<\/a><\/p>\n Insurance Australia Group. (2024). Natural disasters estimated to cost australia $73 billion a year by 2060. https:\/\/www.iag.com.au\/newsroom\/community\/natural-disasters-estimated-cost-australia-73-billion-year-2060<\/a><\/p>\n David Leitch is a regular contributor to Renew Economy<\/a>\u00a0and co-host of the weekly Energy Insiders Podcast<\/a>. He is principal at ITK, specialising in analysis of electricity, gas and decarbonisation drawn from 33 years experience in stockbroking research & analysis for UBS, JPMorgan and predecessor firms.<\/p>\n","protected":false},"excerpt":{"rendered":"Queensland is the most disaster-prone state in Australia. 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