An Approach for Characterizing Third-Party Physical Climate Risk Assessment Frameworks for Utility Applications

The increase in climate risk disclosure requirements has led to a proliferation of third-party physical climate risk assessment frameworks. It is difficult, however, to readily comprehend their strengths and weaknesses. As a result, utilities have expressed a desire to better understand the capabilities and differences between frameworks. Researchers in EPRI’s Global Change, Climate Risk and Target Setting research group (Project Set 201E) proposed an initial characterization template to describe and summarize framework capabilities for electricity, gas, and transmission and distribution utility applications. The characterization template is a spreadsheet with a series of questions that elucidates a framework’s basic functionality, including types of assessment supported, scientific underpinnings, assumptions, and uncertainty characterization. The goals of the characterization template are to provide utilities with a standardized approach to facilitate the following: (i) understanding and comparing framework capabilities; (ii) assessing framework capability for supporting utility applications; and (iii) informing utility framework conversations with providers and stakeholders. The accompanying characterization template spreadsheet also provides an example set of responses for the First Street Foundation’s framework, which includes their Flood Model, Fire Model, Wind Model and Correlated Risk Model. The initial characterization approach is offered for review and refinement with the goal of applying it to additional frameworks and developing a capability assessment library resource.