Climate intelligence, is it intelligent to join the ride?

Discussions around climate + impact are front and center in our society + media headlines. In the PTC network we are seeing an ever growing demand from both (institutional) investors + real estate companies to explore Proptechs that can mitigate risk or create value for stakeholders.

Climate is “hot”(!) and we are seeing a lot of interesting tech, primarily out of (Northern) Europe that is being adopted at a rapid pace…

Change is the stable factor

Even though many industries are striving to break old habits and find new innovative ways to have a positive impact on climate change, the Earth’s climate system will always vary and change in highly non-linear ways. The unpredictable nature of our climate system makes it hard to predict what the future will bring + the impact on real estate (assets) and the (wider) industry in general.

At the same time, there is a growing need for organizations to understand these changes and respond to them to mitigate risk.

The fast-growing frequency and intensity of physical hazards like flooding, drought and heat stress, make it critical for organizations to acquire more insights in climate-related risks. Over the past 50 years the number of hazards has multiplied by five. When we look at the annual costs, we can see a similar increase. Between 2010 to 2019, The United States had to endure 119 climate and weather events that caused an average of $80.2 billion in damage per year, in comparison to a yearly average of $52billion the decade before. Those numbers are real and mind-blowing…

It's all about the data

The consequences of these natural forces on real estate businesses can be enormous. Over the past few years many commercial buildings around the world have been damaged, or even worse, completely destroyed by hurricanes, floods and wildfires. These are direct effects due to the location of physical assets, but an organization can also experience indirect effects when a hazard has an impact on the supply chain or customer access. Given the scale + quantum there’s lots of considerations to take into account.

To be able to hold on in these times of accelerating climate change, decision-making support & clarity is highly demanded. That’s where climate intelligence comes to play. We at the PTC have seen numerous interesting tech in our global network, however the key challenge is to tie the value prop into a tangible ROI. We think there’s still some work to be done.

That being said, climate intelligence is an important tool to give organizations the most comprehensive view possible of direct and indirect climate risks for their assets.

Simulate, manipulate, estimate

So how does it work and how can organizations benefit from climate intelligence?

In short: A set of different model simulations with alternated conditions makes it possible to simulate long-term climate changes and statistically estimate the risks that come with it.

Getting to high-quality and accurate estimations is a 2-step-process.

The first step is sourcing and incorporating the best available dynamic climate data. High-quality data is continuously obtained from various reliable external sources. The second step is analyzing these datasets to develop a statistical approach and transform it into business-critical insights.

The process requires deep expertise in various fields: climate science, atmospheric physics, remote sensing, machine learning, mathematics and statistics all play a significant role in coming to the best analysis. This analysis will allow asset owners/asset managers to make climate intelligent decisions and formulate the best adaptation and mitigation strategies.

Are you interested to get more insights, or plug into some of the leading tech in the climate intelligence space?

We distill the noise and get things done. With global insights + coverage we can help drive ROI from your strategy.

Should you wish to get more insights or get access to such opportunities in our network please reach out:

stephen@theproptechconnection.com OR ivo@theproptechconnection.com