Abstract
Climate change impacts on nature and the environment have
been widely discussed and studied. Traditionally, a
company's continuity management is based on risk
analysis. There are also attempts to implement
scenario-based methods in the risk management procedures
of companies. For industrial decision makers, it is vital
to acknowledge the impacts of climate change with regards
to their adaptation strategies. However, a scenario-based
approach is not always the most effective way to analyze
these risks. This paper investigates the integration of
scenario and risk-based methods for a company's
adaptation planning. It considers the uncertainties of
the climate change scenarios and the recognized risks as
well as suitable adaptation strategies. The paper
presents the results of climate risk analysis prepared
for two Finnish hydropower plants. The introduced method
was first piloted in 2008 and then again in 2015. The
update of the analysis pointed out that at the company
level, the climate risks and other risks originating from
governmental or political decisions form an intertwined
wholeness where the origin of the risk is difficult to
outline. It seems that, from the business point of view,
the main adaptation strategies suggested by the
integrated risk and scenarios approach are those that
support buying "safety margins" in new investments and
reducing decision time horizons. Both of these adaptation
strategies provide an advantage in the circumstances
where also political decisions and societal changes have
a great effect on decision making.
Original language | English |
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Pages (from-to) | 1018-1034 |
Journal | Climate |
Volume | 3 |
Issue number | 4 |
DOIs | |
Publication status | Published - 2015 |
MoE publication type | A1 Journal article-refereed |
Keywords
- climate change
- risk analysis
- climate scenarios
- hydropower plant