Alternative Energy & Fuels

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Factoring Climate Change into Site Selection and Development Decisions

19 May, 2014

By: Michael Nolan

The climate is changing. For the development sector, which has adapted to the challenges of natural hazards, market uncertainties and investor expectations, these changing climatic conditions with associated rising insurance costs pose yet an additional risk.

The climatic conditions of a site have historically been a determining factor for productivity and profitability of business. Rainfall, temperature and rare extreme weather events have always impacted food production, supply chains, health and economic opportunities.

Extreme weather events such as hurricanes in the United States, floods in Europe and droughts in Africa accentuate the impacts that can occur from climate-related events. Often these events serve to highlight shortcomings of past site selection and planning. 

Design standards for buildings and infrastructure take into account climate conditions based on historical rhythms and climatic extremes. Historical records of temperature, wind and flooding, for example, have for a long time been considered in determining the form, design and detailed specifications for new infrastructure, places and open spaces.

However, the rules are changing. Reliance on past climate data for planning growth and investment in new assets, services and markets is no longer sufficient. That a change in climatic conditions has occurred over the past 30 years is evident on every continent. All key indicators of climate including sea level, temperature, extreme storm and drought days are expanding outside the normal ranges of frequency, intensity and location. Increasingly, businesses will benefit from making decisions not on historical weather data, but on forward-looking and longer-range climatic trends and predictions of new climate norms.

The impacts from climate change can vary greatly depending on the location and climate hazard, but can include loss of critical services, increased peak-energy demands, product damage, disabled electronic accounting and logistics systems and reduced operational safety and loss of productivity.

Understanding the direct and indirect impacts of climate change for your industry or business sector can facilitate effective preparation. Information and knowledge can support preparedness and the development of pragmatic adaptation solutions to improve resilience.

Integrating changing climatic conditions into the site selection process does not require extensive climate projection analysis. Instead, it involves a screening of potential climatic changes that could negatively (or positively) impact the value, function and assets of a site. The screening is used to set priorities and to provide focus for a more-detailed assessment of potentially significant impacts to aid in site selection.

The design and development process typically involves a risk assessment and a high-level evaluation of multiple factors to guide design option selection to meet specific business objectives such as functionality, budget, time constraints, value generation, etc. The observed change in climatic trends over the past 30 years compared to the last 100 years provides a good basis for understanding any changes in climate conditions at a site.

Understanding future projected climatic conditions is more challenging. The management and quantification of uncertainty in decision making is the key. Investors and business leaders regularly incorporate uncertainty into their decisions. The imperative is to consider new/emerging/best available information at the time into the evaluation of risk, reward and performance against objectives.

The climatic projections for the future do not constitute perfect information; no amount of computer modelling can accurately predict the future. It can, however, provide a good indication of the likely changes to the range of weather conditions that could influence a decision.

In considering the most practical and cost-effective solutions to increase the resilience of developments to a changing climate, designers need to address risks changing over time with flexibility to easily increase resilience at a later date, such as through enhanced elevation, access, drainage and erosion protection.

Following significant weather-related events such as Hurricane Sandy and the Thailand floods, members of the investment community are seeking evidence that their investment portfolios are sufficiently resilient to climatic impacts. Being able to demonstrate resilience will be a valuable tool for developers and businesses dependent on investor confidence.     

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