Jupiter featured in the International Energy Agency’s World Energy Outlook Report 2022
The World Energy Outlook is a flagship publication by the International Energy Agency (IEA) recognized as the most authoritative source of global energy projection and analysis.
The report is primarily focused on the projections around global energy demand, impact on emission scenarios, and the 2022 Energy Crisis. Comprehensive and highly informative Executive Summary and Key Findings resources are available and are recommended readings for anyone interested in current and projected shocks to the energy system.
This post, however, focuses on the report’s finding around physical risk impact to energy infrastructure from climate change. And Jupiter is publicly featured in a report spotlight (p. 225) in Section 4.9 concerning Climate Resilience of Energy Infrastructure.
The IEA leveraged Jupiter’s climate physical risk metrics in order to quantify the financial impact on a cohort of four critical energy infrastructure sites: a coal power plant in Southeast India, a gas fired plant in Southern Viet Nam, and refineries in Northern Europe and the Southern United States.
More specifically, the study focused on flood risk to these various assets, and leveraged Jupiter’s ClimateScore Global flood depths projections and financial loss modeling to estimate average annual loss from acute flooding for each of these individual sites. Average annual flood loss for each site was computed in 2021, 2030, 2050, and 2100 across SSP1: 2.6 (2 °C) and SSP2: 4.5 (3 °C).
The analysis concludes that significant projected increase in flood intensity across these four locations will lead to higher average annual losses, which range in gravity depending on location. Assets in Southern India and VietNam have lower average annual losses today, but those losses are projected to increase much more rapidly than comparable assets in Northern Europe and in the US Gulf Coast. The report also highlights the benefits of investing in flood defense infrastructure and its related impact on average annual loss to asset value.
The WEO highlights other examples of extreme weather events that could materially impact critical energy infrastructure, including:
- Warming temperatures and reduced efficiency of power plants. As an example, maximum electricity output from a natural gas fired plant (combined cycle) begins to decline above a temperature of 15°C. Jupiter can support these analyses through our quantification of annual and average temperatures, as well as by modeling the number of days across specific temperature thresholds globally.
- Decreasing wind speeds in regions where current major wind operators are located including the Western United States, Northern Europe, and East Asia. These findings are consistent with Jupiter’s wind models, which also show decreasing average annual wind speeds in a number of regions globally.
- Increasing intensity of tropical cyclones and hurricanes, which can cause partial or total failure to wind turbines and electric grid failure by damaging the electricity transmission and distribution infrastructure. Jupiter models acute wind speeds across six different return periods and is actively engaged in storm hardening use cases for transmission and distribution grid operators.
- Increasing intensity of flooding and precipitation events. The WEO highlights instances where thermal power stations in Bangladesh, Germany, and the United States suffered from partial or complete shutdowns due to engulfing flood waters, leakage risk, and supply chain interruptions. Jupiter actively supports resilience analysis on critical generation assets by leveraging ClimateScore Global’s modeling of acute flooding and precipitation at six key return periods. In addition, our 3-meter resolution FloodScore Planning service takes into account local flood defense infrastructure and drainage capacity for individual infrastructure sites.
- The WEO also highlights the impacts of rising global temperatures and intense cold as drivers of extra strain on electric grids for cooling and heating purposes. Jupiter models the annual count of heating and cooling degree days to support these types of demand-side analysis.
Finally, the report highlights the fundamental role of physical system hardening to mitigate against present and future climate physical risks. Massive investments will have to be deployed in improving flood walls and dikes, asset relocation, and energy systems with stronger foundations, towers, turbines, and underground lines.
Jupiter partners with some of the world’s largest power companies on risk mitigation use cases and helps our clients understand the emergence of present and future climate exposures to better inform multi-million dollar risk engineering decisions at the individual asset level.