(31b) Practical Tools for Predicting Acute Weather Event Risks Under Future Climate Scenarios

Many corporations operate facilities in areas prone to acute weather events such as hurricanes, storm surges, floods, wildfires, etc. These extreme weather events often bring significant potential financial losses and elevated process safety risks and impacts. These external impacts are of growing concern for many industrial facilities, and there is widespread consensus among climate scientists that acute weather risks will likely increase if the global mean temperature continues on its recent upward trajectory. In fact, the United States Environmental Protection Agency (EPA) in its August 30, 2022, proposed revisions to the Risk Management Program (RMP) under 40 CFR 68 has added statutory requirements for regulated facilities to include “external events such as natural hazards, including those caused by climate change or other triggering events that could lead to an accidental release” in all required Process Hazard Analysis (PHA).

This presentation will demonstrate a methodology for estimating the magnitude and probability of potential future acute weather events at varying locations based on site-specific data profiles and provide tools to quantify the relative financial risks associated with the events. Furthermore, the methodology will account for variability in asset type vulnerability to different types of weather events, for instance wind damage versus storm surge impacts at a coastal industrial facility during a future hurricane.

The outputs of the acute weather prediction models can then be presented with annualized, dollarized risk impact estimates for both the current time horizon, as well as future climate scenarios based on the Intergovernmental Panel on Climate Change (IPCC) “optimistic” climate scenario (RCP 2.6) and “pessimistic” climate scenario (RCP 7), in terms of their assumptions about the path of global temperature increases. These impact estimates can then be utilized in PHA revalidations, Capex design evaluations, and compared to other metrics for annualized risk such as insurance premiums. Finally, uncertainty profiles around the estimates can l be generated with a straightforward Monte Carlo simulation.

Ultimately, the paper will provide attendees with a proven methodology to predict process safety and financial risks associated with climate change and increased acute weather events, quantify how t the level of risk varies by time horizon and by climate scenario, and provide useful quantitative results on acute weather risks to be used in process safety risk assessments, PHA studies, and emergency response planning.