Increased frequency of floods and storms from climate change can increase project delays, either through construction stoppage or late arrival of building materials due to transportation disruptions. Furthermore, the region’s building owners and developers should be prepared for stricter enforcement of permitting terms and tougher regulatory requirements relating to energy and water use. These factors contribute to higher material costs, so developers could face longer-term price increases for energy-intensive and imported materials.
The 2010 hurricane season began on June 1, amid widespread concern over the potential for a large storm to exacerbate the damage from the Deepwater Horizon oil spill. As the map above shows, catastrophic hurricanes (Category 3 or higher) regularly hit the southern coast of the United States. NOAA (the National Oceanic and Atmospheric Administration) predicts an 85 percent chance of an “above normal” hurricane season this year, due to conditions including exceptionally warm sea surface temperatures in the Atlantic Ocean tropical zone.
The analysis in WRI's report "Over Heating: Financial Risks from Water Constraints on Power Generation in Asia" found that new power generation capacity will be increasingly located in areas already considered to be water stressed or scarce (the power sector requires a steady supply of water for cooling and generation to maintain loads and avoid disruptions).
According to WRI's report "Over Heating: Financial Risks from Water Constrains on Power Generation in Asia," the majority of existing and new power generating capacity for publicly listed companies in South and Southeast Asia are located in areas classified as water scarce and stressed.
While many of the governments have goals to increase the development of renewable sources of energy; coal, natural gas, and hydroelectric plants are expected to provide the majority of electricity supply in 2013.
The dependency of thermal and hydroelectric power plants on water for cooling and generation creates water-related risks for the sector.
The Intergovernmental Panel on Climate Change (IPCC) estimates that in parts of Asia, climate change could result in declines in agricultural (not including animal) output by between 2.5–10% by the 2020’s and by 5–30% by the 2050’s compared to 1990 levels (without CO2 fertilization effects). This figure shows longer-term estimates of the crop yield decreases in India, Indonesia, Malaysia, Philippines, Thailand, and Vietnam.
Water scarcity is a growing concern for many parts of the world. In India in particular, and in parts of the other five countries of this study, high demand for water, coupled with water pollution, means that water reserves are being used faster than they can be replenished. This trend will accelerate in some areas, as population and economic growth lead to higher water consumption in the region.
The food and beverage sector is a significant water user, especially in its supply chain, as agriculture comprises the largest user of water in the six countries from this study--India, Indonesia, Malaysia, Philippines, Thailand, and Vietnam (as is the case in many countries). Water usage is greatest in the growing, harvesting, and rearing phases of production. The sector’s high water dependency makes the impacts of water scarcity more pronounced.
Though the forest products industry as a whole may stand to gain, climate change will impact companies and investments differently based on the location of the forests, mills, and markets, the vertical integration of assets, and the sustainability of forest operations. This figure illustrates these risks and opportunities in a qualitative way with respect to their potential financial impact and the level of certainty.
In addition to being important for human health, access to an improved water source is indicative of the state of a country's overall physical infrastructure. Access to improved water provides a buffer against climate change and variability, especially in countries which are prone to drought. Populations with access to improved water are also less at risk of contracting water borne diseases. In many countries, women are responsible for collecting water.
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