Climate Change and its impact on Infrastructure

Climate change already has far-reaching impacts on infrastructure and can put their operation and reliability partially at risk. This trend is likely to accelerate in the coming decades. Main threats to infrastructure assets include damage or destruction caused by extreme weather events, which climate change may exacerbate; coastal flooding and inundation from sea level rise; changes in patterns of water availability; and effects of higher temperature on operating costs, including effects in temperate. Some infrastructure may not be affected directly but be unable to operate if physical access or services to it such as electricity is disrupted.

The need for infrastructure investment over the coming decades is enormous. Climate change does not alter this need but may increase its costs. Climate change may also affect where infrastructure is built and how it is designed and operated. There will also be a need for additional infrastructure, dedicated to climate protection, such as improved sea defences and flood protection, interconnections in water supply, as well as retro-fitting to improve resilience of existing infrastructure.

Making infrastructure resilient to climate change is an important and early adaptation challenge. This might not come cheap as infrastructure adaptation usually dominates adaptation cost estimates. It also requires sophisticated decision-making, given how little we know about future climate effects at the regional level. However, starting this process is important, including at the earliest planning stages. Infrastructure assets are long-lived and have the potential to lock in development patterns for a long time.

Changes towards more climate resilient infrastructure investments present some specific challenges. First, they often have higher up-front capital costs, even if their climate resilience makes them more profitable over the lifetime of the infrastructure. Second, investors may calculate an additional risk premium for projects to develop climate resilient infrastructure, due to the uncertainty surrounding the implications of climate change in the long run. Third, ecosystems provide some critical services for example, well-functioning natural habitats on coasts or in floodplains protect against extreme weather events. Investing in protecting these habitats can be less costly than developing or adapting man-made infrastructure, but market structures or incentives are not yet sufficiently implemented to make such investments always profitable.

However, addressing climate risks in investment and operating or management decisions can not only mean avoiding costs at a later state but also opening new economic opportunities. Adapting infrastructure to climate change impacts presents opportunities if early action is taken and expertise developed. This includes new skills and technologies as well as additional adaptation capacity to enable infrastructure to be adapted such as new engineering practices or IT-based technology. What is a risk for city planners, utility firms, businesses and homes, can in turn be an opportunity for those who build and maintain infrastructure. This know-how and expertise can also be an important asset in global competition and be exported to other parts of the world. From a territorial perspective, the urban dimension of infrastructure adaptation is crucial. As a large share of important, often closely inter-linked infrastructure is concentrated in India’s urban cities, urban adaptation must deal with many multiple, cross-sectorial issues in infrastructure development and operation.

The severity of climate impacts on infrastructures will vary across the country according to individual locations and their geophysical risk exposure, the existing adaptive capacity and resilience, and the level of regional economic development. Long- and medium-term climatic trends e.g. increasing average temperatures, modified rainfall patterns and an inherently rising frequency of extreme weather events impact differently from site to site. Climate impacts not only show regional and seasonal patterns e.g. North/South, winter/summer; but also differ between territorial settings e.g. urban/rural/coastal. Therefore, adapting infrastructure usually requires a complex, site-based analysis of different trends and impact patterns.

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