Air-conditioning and irrigation systems account for more than half of the adaptation spending to protect at 2ºC to developed-economy standards. Protection against heat and drought accounts for three-quarters of the adaptation costs at 2°C of warming, primarily for air-conditioning and irrigation. While this may seem surprising, more than 40 percent of the global population in 2050 would live in places exposed to heat stress, while less than 1 percent would live in areas exposed to coastal flooding. Distribution of annual average operating and amortized capital costs to adapt to 2ºC hazards to developed-economy standards, 2020–50, % Heat stress: 49 ($568 billion) Drought: 20 ($226 billion) Excess- rainfall flooding: 10 ($115 billion) Riverine flooding: 6 ($64 billion) Heat waves: 8 ($93 billion) Wildfires: 6 ($67 billion) Coastal flooding: 2 ($18 billion) Active cooling (air-conditioning) 38 Irrigation 16 Detention basins 4 Stormwater networks 4 Swales 1 Levees 5 Sea dikes 1 Flood proofing 1 Crop shade cover 4 Urban trees 5 White roofs 5 Crop shade cover 1 Active cooling (fans) 3 Personal cooling 3 Cooling shelters 1 Early-warning systems 1 Undergrounding power lines 3 Fuel management 3 Note: This analysis is based on warming levels likely under current emissions trajectories, which project that the global temperature is likely to rise 2ºC relative to preindustrial levels sometime in the next 3 decades (measured based on multidecadal average temperatures). It includes nonsurvivable heat, the costs of which are incorporated into the other heat-related hazards. Currency figures are in 2020 US dollars. Figures may not sum to 100%, because of rounding. Adaptation measures with <1% are not labeled on this exhibit. Source: Coupled Model Intercomparison Project (CMIP6), 2021; European Union Global Human Settlement Layer; Fathom Global Flood Map Fathom 3.0, 2021; Inter-Sectoral Impact Model Intercomparison Project Phase 2b (ISIMIP2b), 2017; Kummu, Taka, and Guillaume, 2018; NASA NEX-GDDP, 2021; McKinsey Global Institute analysis 120 M C K I N S EY Q UA RT E R LY Advancing Adaptation