Formatted Title
Climate Risk Assessment for Portfolio Management
Background/Objectives
As climate change impacts continue to intensify globally, the importance of awareness of climate-related vulnerabilities is becoming a priority for site owners and regulatory agencies. Agencies are increasingly requesting consideration of climate change impacts in remedial design, while site owners are also concerned about potential financial and business risks resulting from climate vulnerabilities.
While there are tools available in the market for identifying potential climate vulnerabilities, these tools typically look at the climate risk from the lens of a single site. However, many site owners manage a portfolio of sites and as such require a way to identify and prioritize the sites most exposed to adverse impacts from climate change. The approach taken by Woodard & Curran to answer this question offers site owners a comprehensive, structured, and quantitative approach to evaluating site portfolios that allows review of multiple climate change scenarios, climate change hazards, and projected timeframes to identify high risk sites so that site owners may prioritize climate mitigation measures to manage risk appropriately.
Approach/Activities
Woodard & Curran developed climate risk assessment to support public and private clients in assessing and mitigating risk related to climate change across a distributed portfolio of assets. Our approach combines Global Climate Model (GCM) extraction and downscaling, climate stressor risk quantification algorithms, big data management, geospatial visualization and mapping, resilience strategy, and engineering capabilities to deliver critical insights to climate-related liabilities and actionable recommendations, prioritizing sites identified to be at highest risk in the portfolio. The approach has a global focus, allowing the standard methodology to be applied at any location on the globe, and evaluates the outcome of several possible climate scenarios. At-a-glance indices of climate impact can be evaluated for all sites within a portfolio, and subsequently sites are identified and prioritized for climate risk mitigation measures. Site owners are able to compile relevant climate data, evaluate the climate stressor risks associated with their operations and geography, and plan and prioritize capital projects to mitigate those risks.
The results of the evaluation were visualized in an interactive dashboard, allowing the user to explore the impacts of various climate scenarios and specific climate stressors on any unique combination of sites within a portfolio.
Results/Lessons Learned
The portfolio approach to climate risk assessment allows for compilation of relevant climate data, evaluation of the climate stressor risks associated with site operations and geography, and the ability to plan and prioritize capital projects to mitigate those risks. With the data access and understanding of climate-related risk provided by the portfolio approach, site remediation owners achieve more informed decision making, quantified scenario analysis, and greater confidence in continuity planning.