Adapting to climate change and enhancing resilience to weather July 2012

Yorkshire Water (YW) recognises the need to enhance the resilience of our assets and services to today’s weather and to tomorrow’s climate. This goes to the heart of our vision: taking responsibility for the water environment for good.

We have seen how drought, floods and cold winters have impacted utility providers in recent years. These extreme weather events have shown current levels of resilience to weather and areas of vulnerability. In the future our assets and services are likely to be challenged by more frequent and more severe extreme weather events because the climate is changing. We need to consider both past events and future projections to ensure robust, long term decision making. This is important now because assets we build today will be in operation for many decades to come.

There is overwhelming scientific evidence that the climate is changing. Our latest assessment confirms that climate change and extreme weather pose strategic risks to YW, potentially impacting on every part of the business in both the short and long term.

Mitigation

Communication

Introduction

Climate change strategy

The climate and weather are fundamental to the sustainability of a water and wastewater service provider. This paper summarises how we are preparing for inevitable climate change – this is known as adaptation. In parallel to our adaptation activities, we are working to reduce our greenhouse gas emissions to play our part in minimising future climate change – known as mitigation. Central to an effective response to climate change is the need for internal and external communication and collaboration. Together, these three elements combine to form our climate change strategy.

Asset flooding, resilience to cold weather and our long term ability to maintain the water supply-demand balance are all risks to our organisation. In the long term, the cost of managing these risks in order to maintain services in a changing climate could be large. To avoid significant price shocks for our customers and investors, we are developing long term plans to adapt to (or prepare for) the changing climate. We’ll be defining a comprehensive statement of needs for extreme weather resilience and climate change in the upcoming Price Review (PR14).

This paper defines YW’s view on climate change. In this document we outline the latest evidence and we summarise the latest understanding about the potential risks to YW from extreme weather events and climate change. We describe how we are proactively responding to climate and weather risks by continuing to develop our understanding in this rapidly evolving area. This will allow us to take appropriate action at the right time, in both the short and long term.

The statements below summarise our position on climate change:

• The climate has been changing and will continue to change

• Climate change presents risks to our strategic objectives and the services we provide

• We will quantify the climate change risks that face our business

• We will develop long term plans to manage the climate change risks that face our business

• We will promote activities to address our climate change risks

• We will drive initiatives to empower every employee to reduce carbon emissions and prepare for the changing climate.

Adapting to climate change and enhancing resilience to weather Yorkshire Water 03

Adaptation

Lower Laithe Reservoir, Yorkshire

Executive summary

YW is experienced at operating in extreme weather conditions (Section 1: Responding to recent extreme weather events). Recent events have demonstrated current levels of resilience to weather, and areas of vulnerability. There is a limit to the level of resilience designed into any system because of engineering capability and affordability (for example).

Therefore, some extreme weather events have had significant impacts on YW, including:

• Interruptions to customer services and high customer contact rates

• Concerns over colleague wellbeing

• Unplanned financial costs

• Scrutiny from regulators and concern over regulated targets

• Damaged reputation.

Yorkshire Water recognises the need to enhance the resilience of our assets and services to today’s weather, and to tomorrow’s climate. Meeting these needs goes to the heart of our vision: taking responsibility for the water environment for good. Managing the impact of climate change is critical if we are to meet our Strategic Business Objectives:

The business continues to identify and address areas where we can enhance our resilience to weather. For example, we have reviewed our winter planning and carried out a flood risk assessment. As we plan for our sustainable future we will need to factor in projected climate change. We will need to consider both investment and operational options. The Cabinet Office (20111) outlines the four principal components to an effective infrastructure resilience strategy, below. YW will use this approach to inform its business plan proposals at PR14.

• Resistance – protection to withstand a hazard (e.g. a flood wall)

• Reliability – the ability of an asset to operate in a range of conditions (e.g. asset design)

• Redundancy – designing capacity into a system (e.g. backup pumps)

• Response and Recovery – enabling fast and effective response to, and recovery from, an event (e.g. emergency planning).

There is compelling scientific agreement that the climate is changing in response to human greenhouse gas emissions. A summary of recent evidence is provided in this document (Section 2: Evidence for existing climate change). The majority of evidence shows trends for gradual warming, changing precipitation patterns, sea level rise and more frequent, more severe extreme weather events. These changes will challenge existing levels of resilience to extreme weather.

There is increasing evidence that human emissions have already influenced weather and climate over recent decades (Met Office, 20102). For example, recent research has found that progressive shrinking of Arctic sea ice has brought colder, snowier winters to the UK (Georgia Institute of Technology and Beijing Institute of Atmospheric Physics, 20123).

Greenhouse gas emissions have also been found to have significantly increased the chance of the heavy rainfall which led to the floods in the UK in autumn 2000 (Oxford University, 20114). The rainfall was the wettest recorded, with the river Ouse reaching its highest levels since the 1600s (Met Office5).

Further climate change is inevitable because, even if emissions stopped today, the climate would change for at least the next 40 years because of those emissions already released into the atmosphere (Acclimatise and UKCIP, 20066). Human global emissions are at their highest ever recorded levels and rising rapidly (International Energy Association, 20117). Emission levels are approaching the top end of scenarios modelled in the 2009 UK climate projections (UKCP09). These projections show levels of climate change increasing in severity through the 21st century (Section 3: Projecting future climate change). Many of the assets we build today will remain in use for many decades and therefore need to be designed with the future climate in mind.

Climate change is one of many pressures facing our business, therefore integrated risk management is essential. We recognise that weather and climate risks need to be considered alongside the other sustainability challenges, such as population growth and affordability (Section 4: Climate change in context – long term sustainability).

The latest evidence and understanding shows us that extreme weather and climate change present YW with a number of opportunities and risks (Section 5: Opportunities and risks). Our recently completed climate change risk assessment has confirmed the potential for climate change to impact on every part of the business at every level, in both the short and long term. All of our employees will have a role in our response to climate change.

Yorkshire Water

A trusted company

Strong financial foundations

Sustainable resources

Safe water

Water efficient regions

Excellent catchments, rivers and coasts

Achieving safe water and excellent catchments, rivers and coasts will be supported by our response

to climate change.

To be a trusted company with strong financial foundations, we will need to maintain resilient

services in the changing climate.

To have water efficient regions and sustainable resources it will be essential to operate effectively in

the climate projected for the latter half of this century.

05Adapting to climate change and enhancing resilience to weather

Yorkshire Water

Some examples of our risks and opportunities are below: The best available evidence allows YW to conclude that there is a compelling need for action (Section 6: Conclusions). It is critical for us to understand how the changing climate might impact on assets and services, and how to mitigate those impacts. In the Water White Paper, Defra (20118) make it clear that they expect water companies to take early action and plan an effective response. Defra’s views about the water sector confirm our own – we are at the forefront of climate change adaptation.

Our Adaptation Strategy Group (ASG) is a cross business group of colleagues who are leading the development of our approach to climate change adaptation. There is inevitable uncertainty when modelling the future and we are continuing to advance our understanding in this rapidly evolving area. To inform effective early action we are examining levels seen in past extreme events and data from the ‘very likely’ range of climate projections to inform ‘low regrets’ decisions. Uplift factors to account for uncertainty will be important. Extensive assessment will be essential, particularly for long term or climate-sensitive decisions.

The ASG is leading a four phase climate change project which will inform our PR14 and longer term planning (Section 7: Short term action plan). Phases 1 and 2 were supported by our partner URS.

Our four phase project: • Phase 1: Impact and vulnerability assessment

(Completed December 2011). This provided a comprehensive understanding of the UK Climate Projections (UKCP09) (summary in Section 2 and 3) and a high level review of learning taken from recent extreme events (URS, 201110) (summary in Section 1).

• Phase 2: Strategic climate change risk assessment (Completed March 2012). This involved YW’s most thorough climate change risk assessment to date. A strategic climate change risk register has been developed (Section 5 and Appendix 4*). This is enabling high level climate change risks to be owned and monitored through our corporate risk framework.

• Phase 3: Detailed climate change risk assessment (April to December 2012). Informed by Phases 1 and 2, detailed risk assessment is being carried out to inform operational and investment needs. We are planning to use internal and UK Water Industry Research (UKWIR) information and tools to support this assessment. Our approach is currently being developed.

• Phase 4: Detailed policy position (Q4 2012/13). The learning from Phases 1 to 3 will be used to establish YW’s detailed policy position on the potential impacts of climate change, and the planned response.

The information obtained from Phases 1 and 2 of the project has supported the development of this position paper. We plan to update this document as our understanding develops and our detailed position takes shape.

We recognise the need to further enhance the resilience of our assets and services to today’s weather, and to tomorrow’s climate. Communication and collaboration will be a key part of this strategy. It will be essential to work with academia, customers, Government, regulators, suppliers and other stakeholders to ensure an effective and integrated approach. An early priority is to engage with Ofwat and others to secure agreement on our approach to decision making about climate change and extreme weather for PR14.

Climate change will be an issue for YW throughout this century. Flexibility will be central to our long term strategy (Section 8: Long term strategy) which will inevitably continue to evolve as knowledge develops. Our response will be one of continual improvement, with iterative responses developing in line with latest understanding. Inaction itself would be a growing risk.

A seasonal shift in precipitation to drier summers and wetter winters is likely to mean that we need to catch more water when it is available and work with customers to use less, in order to develop water efficient regions.

An early response to climate change will help ensure long term affordability for our customers. Responding to climate change has the potential to drive incremental investment in the coming decades, helping to deliver strong financial foundations.

Safe water

Water efficient regions

Strong financial foundations

A trusted company

More frequent and more severe rainfall events are likely to increase the risk of flooding and challenge the ability to deliver safe water. Rivers with lower flows in drier summers may need increased environmental protection.

By demonstrating leadership, YW can differentiate itself within the industry, reinforcing its position as a trusted company. Working in partnership will become increasingly important to our success.

07

Defra (20129)• The recently published national climate change

risk assessment highlights “flood and coastal erosion risk management” and “management of water resources” among two of six areas which may have “the greatest need for action within the next five years”

• “By the 2050s, between 27 million and 59 million people in the UK may be living in areas affected by water supply-demand deficits…”

• “Annual damage to UK properties due to flooding from rivers and the sea currently totals around £1.3 billion. For England and Wales alone, the figure is projected to rise to between £2.1 billion and £12 billion by the 2080s…”

*Please visit yorkshirewater.com/climatechange for more information, including the Appendix document.

Adapting to climate change and enhancing resilience to weather

Stormy seas at North Bay Scarborough, Yorkshire

Contents“ Yorkshire Water recognises the need to enhance the resilience of our assets and services to today’s weather, and to tomorrow’s climate. This goes to the heart of our vision: taking responsibility for the water environment for good.”

Please visit yorkshirewater.com/climatechange to download the Appendix document containing:

Appendix 1: Climate change and resilience to weather glossary of terms Appendix 2: Evidence for climate changeAppendix 3: Summary tables of UKCP09 dataAppendix 4: Yorkshire Water’s strategic climate change risk register.

Part A: Latest evidence and understanding1. Responding to recent extreme weather events 112. Evidence for existing climate change 133. Projecting future climate change 15

Part B: Yorkshire Water position4. Climate change in context – long term sustainability 195. Opportunities and risks 206. Conclusions 237. Short term action plan 258. Long term strategy 28

References 30

Part A: Latest evidence and understanding

1. Responding to recent extreme weather events

External context

Defra, 20118 “If we are to manage our water resources responsibly, we must make sure supplies and infrastructure are resilient to conditions we face now and to a changing climate. We only need to look at events over the last few years to understand the impact weather can have on the services we take for granted.”

Committee on Climate Change – Adaptation Sub-Committee, 201111 “The UK is coping with the current climate, but some sectors such as water supply are near their limits…although water supply is resilient to current climate, many aspects are only just coping and the resilience comes at a continued environmental cost. While only 8 per cent of water resource zones in England are currently at risk of falling short of demand during a severe drought, this could increase to around 45 per cent by 2035 without remedial action.”

Chapter summary• Extreme weather events are projected to become more common and more severe

• Recent weather events demonstrate current resilience and vulnerabilities

• Past extreme weather events show the types of pressures to expect from climate change, and can inform the response measures that will be needed. However, historic weather alone is no longer a reliable guide to future weather

• The Cabinet Office identifies four components to an effective infrastructure resilience strategy: resistance, reliability, redundancy, and response and recovery.

Yorkshire Water 11

Image on previous page shows extensive flooding at York Racecourse, North Yorkshire

Climate change projections show that extreme weather events are likely to become more common and more severe through the 21st century. Past extreme events can provide an insight into the types of pressures that are likely to increase as a result of climate change, and the types of response measures that will be needed. However, historic weather no longer provides a reliable guide to future weather. The Met Office (201112) state “we cannot plan for the future based on the climate of the past.”

Yorkshire Water has managed services during numerous extreme weather events over recent decades, demonstrating a high level of resilience to a wide range of climatic conditions. There is a limit to the level of resilience designed into any system, limited for example by affordability, engineering capability and technical understanding.

Therefore, some severe weather events have challenged YW’s infrastructure and ways of working. Such events have resulted in significant impacts, including:

• Interruptions to customer services and high customer contacts

• Concerns over colleague wellbeing

• Unplanned financial costs

• Scrutiny from regulators and concern over regulated targets

• Damaged reputation.

Enhancing weather resilience A report on improving the resilience of critical infrastructure from natural hazards was published by the Cabinet Office in 20111. This identified four principal ‘strategic components’ to infrastructure resilience, shown in the diagram below. A full definition for each of the terms can be found in the glossary in Appendix 1*. The Cabinet Office guidance states that “Given the range of risks, organisations should select combinations of responses from all four of these components to develop a strategy that will deliver the most cost effective and proportionate risk management response to the hazards and threats”. This demonstrates that both investment and operational responses should be considered. This reinforces the importance of effective asset maintenance and reliability, and emergency response plans.

Infrastructure resilience

ResistanceProtection to

withstand a hazard (e.g. a flood wall)

RedundancyDesigning capacity

into a system (e.g. backup pumps)

ReliabilityThe ability of an

asset to operate in a range of conditions (e.g. asset design)

Response and Recovery

Enabling fast and effective response to, and recovery

from, an event (e.g. emergency planning)

2. Evidence for existing climate change

External context

Met Office, 20102 “The evidence continues to accumulate, strengthening the link between man’s activity and a wide range of indicators of a changing climate, both globally and regionally…

“Controversy over this past year has led some to question the evidence for climate change and man’s involvement in that change. In fact, the evidence of a rapid long term change in climate, driven by mankind’s activities, is becoming even stronger.”

Chapter summary• There is scientific consensus that the climate is changing

• Trends show gradual warming, changing precipitation patterns, sea level rise and more frequent, more severe extreme weather

• There is increasing evidence that emissions have already changed the climate and weather, both globally and regionally (e.g. UK floods in 2000).

There is now overwhelming scientific agreement that the climate is changing in response to human greenhouse gas emissions. The vast majority of evidence supports trends for gradual warming, changing precipitation patterns, sea level rise and more frequent, more severe extreme weather events. Predicting the future is inherently uncertain, however the weight of research has moved the debate from ‘if’ to ‘when and how much’.

There is increasing evidence that emissions from human activities have already influenced the weather and climate of recent years, both globally and regionally. In separate climate models developed by various institutions, the observed climate change can only be explained if they take account of human factors as well as natural variations. This provides strong evidence that human activity has contributed to climate change. Appendix 2* includes a table summarising numerous pieces of recent research evidence.

Yorkshire Water 13Adapting to climate change and enhancing resilience to weather

*Please visit yorkshirewater.com/climatechange for more information, including the Appendix document.*Please visit yorkshirewater.com/climatechange for more information, including the Appendix document.

Evidence for climate change include:

• Human greenhouse gases contributed to observed intensification of extreme rainfall events across the Northern Hemisphere (Edinburgh and Victoria Universities, 201113).

• Human greenhouse gases significantly increased the risk of the floods in the UK in 2000 (Oxford University, 20114). The rainfall event was the wettest since records began in 1766, with the River Ouse reaching its highest level since the 1600s (Met Office5).

• Trend of increasing global temperature from the late 1970s onwards (Met Office, 20102).

• Very high confidence that recent warming is strongly affecting terrestrial biological systems, including such changes as earlier timing of spring events, leaf-unfolding, bird migration and egg-laying; and poleward and upward shifts in ranges in plant and animal species (IPCC, 200714).

• Global average sea level has risen by between 10 and 20cm during the past century. At North Shields the trend displays a rise through the 20th century of about 2mm per year (National Oceanographic Centre15).

• Climate change has been shown to have affected the long term trend of Arctic ice, with a decline of around 2.4 million km2 of Arctic summer sea ice since the late 1970s – an area larger than Greenland (Met Office, 20102).

3. Projecting future climate change

Chapter summary• Further climate change is now inevitable due to emissions already released. The degree of

change will depend on future emissions

• Global emission levels currently lie between the UK Climate Projections (UKCP09) medium and high emissions scenarios, on a rising trajectory

• There is no ‘one size fits all’ approach to decision making about climate change responses. This will depend on the specific decision to be made, and risk appetite

• The range of projected climate change is narrower until the 2040s. This can enable many decisions to be made with confidence. The range of projected climate change widens in the longer term as modelled scenarios diverge. Therefore, plans for long life assets or long term strategies need careful consideration

• Research has shown that no model is likely to project the full range of potential future climates. Therefore, using best available data and expert judgement is needed for sensitive decisions.

External context

Acclimatise and UKCIP, 20068 “Even if we make a significant reduction in greenhouse gas emissions tomorrow, the lag in the climate system means that we will need to cope with a changing climate for the next 40 plus years, due to emissions we have already put into the atmosphere.”

Defra, 20118 “The worst case scenario in a Met Office study suggested that we might have ten times as many significant droughts by 2100, with droughts like that of 1975-76 occurring on average every ten years.”

Yorkshire Water 15Adapting to climate change and enhancing resilience to weather

Blackburn Meadows, Wastewater Treatment Works, Sheffield, South Yorkshire

A further degree of human-made climate change is now inevitable. As quoted above, even if emissions stopped today, the climate would change for the next 40 plus years due to those emissions already released. In reality, global emissions have continued to rise and trends for the next few decades are largely fixed by existing and planned energy infrastructure which continues to be dominated by fossil fuels. The exact nature of future climate change will depend on the level of greenhouse gas emissions. At current rates the planet is heading for significant climate change.

The graph below shows recent global emissions and various scenarios modelled by the leading international body for the assessment of climate change, the Intergovernmental Panel on Climate Change (IPCC). This shows that global emissions sit towards the top end of previously modelled scenarios. The IPCC scenarios are based on observed carbon dioxide (CO

2)

emissions until 2000, at which point the projections took effect. The black line shows actual emissions data recorded until 2010.

The 2009 UK climate projections (UKCP09) are widely recognised as being among the most advanced in the world, providing the best evidence available to incorporate into planning decisions in the UK. UKCP09 provides projections for each decade up to the end of the century, for three emissions scenarios (high, medium and low). On the above graph, the high UKCP09 scenario is the same as the labelled A1F1 scenario.

The medium UKCP09 scenario lies between labelled scenarios A1T and A2 (URS, 201110). This indicates that global emissions currently exceed the medium UKCP09 scenario, and are on a rising trajectory.

The projections provide a vast set of data. Decision makers need to decide how to select data to inform their specific decision and risk appetite – there is no ‘one size fits all’ approach. In their recently published national climate change risk assessment, Defra (20129) state that “Adaptation is context specific – effective adaptation depends on who is adapting, where they are, their attitude to risk, and how they weigh up other factors in their decisions.”

In the 25 year planning timeframe that will suffice for most current decisions at YW, the range of projection data is narrower because the scenarios do not diverge significantly until the 2040s. However, the range of projected climate change increases over time with increasing uncertainty. This means that decisions about long life assets or long term strategies need more detailed consideration. Effectively planning for climate change is likely to involve extensive analysis and optioneering using the best available data and expert judgement.

It is important to note that research has shown that no model is likely to project the full range of potential future climates (URS, 201110). Therefore, steps need to be taken to assess the sensitivity of any proposed action to a wider set of future climates. This approach is confirmed in the recently published National Policy Statement for Wastewater. This document states “The decision maker should be satisfied that there are not critical features of the design of new wastewater infrastructure which may be seriously affected by more radical changes to the climate beyond that projected in the latest set of UK climate projections…” (Defra, 201216).

Below is a high level summary of the UKCP09 findings for Yorkshire, taken from the report provided in Phase 1 of our four phase climate change project (URS, 201110). These figures are based on the high emissions scenario. The probability level is shown in brackets after each statement. A wider distribution of data is projected with different probability levels and in differing scenarios. Summary tables of data for the UK and Yorkshire under different scenarios and probability levels can be found in Appendix 3*.

Changing precipitation patterns

• UKCP09 projects that precipitation will become more seasonal, with an increase in winter and a decrease in summer. Daily summer precipitation is projected to decrease by around 10 per cent by the 2030s and by around 18 per cent by the 2050s (50%ile). Daily winter precipitation is projected to increase by around 7 per cent by the 2030s and by around 13 per cent by the 2050s (50%ile).

• The annual number of dry spells lasting five or more days is projected to increase, with an extra four occurrences by the 2030s and an extra seven occurrences by the 2050s (data from a 5km grid square over Leeds, 90%ile).

• Projections show that rainfall events will get heavier and/or longer. The annual number of days when precipitation is greater than 25mm and 40mm per day, and the annual number of precipitation events lasting three or more consecutive days, are projected to increase in frequency. These could be used as indicators for potential flooding.

Rising sea levels

• Relative sea levels are projected to rise by up to 0.25m by 2030 and 0.41m by 2050 on the Yorkshire coast (95%ile). This could have a significant impact on low lying areas in our region.

Warmer temperatures, but maybe colder winters

• Both summer and winter temperatures are projected to increase by around 1.7°C by the 2030s and by around 2.7°C by the 2050s (50%ile).

• Heatwaves are projected to become more frequent. The number of annual heatwave days is projected to increase by up to six days by the 2030s and by eight days by the 2050s (data from a 5km grid square over Leeds, 90%ile).

• Sub-zero temperatures are projected to decrease in frequency. The annual number of frost days is projected to decrease by up to six days by the 2030s and by 14 days by the 2050s (data from a 5km grid square over Leeds, 90%ile). However, more recent research has found that progressive shrinking of Arctic sea ice is bringing colder, snowier winters to the UK, Europe, North America and China (Georgia Institute of Technology and Beijing Institute of Atmospheric Physics, 20123). This is the latest of several recent studies to find a relationship between Arctic ice and winter weather. The research looks to confirm that warming atmospheric temperatures reduce the strength of the northern jet stream which normally brings milder winter weather to Europe.

Yorkshire Water 17Adapting to climate change and enhancing resilience to weather

*Please visit yorkshirewater.com/climatechange for more information, including the Appendix document.

Damflask reservoir during a dry period in 2003

Part B: Yorkshire Water position

4. Climate change in context – long term sustainability

Chapter summary• Our sustainability assessment has identified climate change as one of several pressures

facing the business

• To be sustainable and make fully informed decisions, it is imperative that YW understands the potential impacts and interrelations of all pressures facing the business

• Climate change risks and their mitigation cannot be resolved in isolation.

External context

Environment Agency, 201117 “Water is a precious resource that faces increasingly severe and often conflicting pressures. Water resources will become more stressed in future as a result of climate change, increasing demand and changes in lifestyle. Careful planning will be critical to ensure sustainable water supplies for people, businesses, agriculture and the environment. It is important to understand the scale of the challenge now because it takes many years to plan and invest in solutions.”

Ofwat, 201018 “Our research shows that consumers continue to place the highest importance on delivering safe and reliable water and sewerage services. So, their resilience remains a key priority, particularly as the issue is likely to become an even greater concern in the future. The water and sewerage sectors face a number of new challenges that will have an impact on the services provided to consumers. In particular, climate change projections consistently show that the frequency of extreme weather events will increase in the future.”

Our recently completed strategic climate change risk assessment found that climate change risks do not stand alone. Weather and climate change risks, and their mitigation, cannot be resolved in isolation; they run in parallel with all the pressures facing the business. Our broader sustainability assessment has identified the changing climate as one of several factors that will shape our organisation and its customer services over the long term. Other relevant factors include, for example, population growth, affordability, financeability and societal demands. The sustainability assessment is informing YW’s overarching approach to

managing the business and its customer services for the long term.

Many of the pressures and response needs identified in the sustainability assessment will influence, support or conflict with each other. To be sustainable and make fully informed decisions, it is imperative that YW understands the potential impacts and interrelations of all these pressures. Therefore, it is essential that all these pressures are managed consistently, for example by embedding them in our business objectives and risk management systems.

Yorkshire Water 19

Yorkshire Water

5. Opportunities and risks

Chapter summary• YW is managing numerous opportunities and risks relating to extreme weather and climate

change. Some of the risks are identified as national priorities by Defra. YW is among those on the front line of climate change adaptation

• Risks include growing pressure on the ability to provide affordable water and wastewater services in the long term

• The drivers to further enhance resilience to extreme weather may provide benefits to customers, stakeholders, investors and employees.

External context

Environment Agency, 20118 “Responding to the challenge of constrained water resources both at home and abroad will create opportunity for ambitious companies with innovative ideas.”

HM Treasury and Infrastructure UK, 201119

“Meeting demand sustainably will therefore require continued investment and innovation from water companies, demand management and changes in the way that water resources are managed.

“Further investment by water and sewerage companies will be required up to and beyond that time [WFD timescales, 2027] to ensure that they are able to continue to provide essential services for a growing population without causing unacceptable environmental impacts.”

YW has recently completed a strategic climate change risk assessment. This was the most comprehensive climate change risk assessment we have carried out to date, involving colleagues from across the business. The assessment has confirmed that YW is managing numerous strategic climate change risks which have the potential to impact on every part of the business at every level, in both the short and long term.

YW is among those on the front line of climate change adaptation.

Some of the most significant opportunities and risks are summarised in the table below. A more detailed summary of the strategic climate change risk register can be found in Appendix 4*.

Opportunities Risks

Long term resilience of water and wastewater services

Addressing known vulnerabilities will make services even more resilient to extreme weather and the changing climate. This in turn supports:• Yet more reliable customer and environmental services• Reduced risk of emergency response measures which

incur unexpected costs, regulatory investigation and damaged reputation

• Enhanced wellbeing for employees.

Increasing challenge to water supply/demand balance and wastewater treatment:• Growing supply pressure during hotter, drier summers,

with more heatwaves (may be compounded by reform of abstraction licensing)

• Seasonal shift to drier summers and wetter winters may mean we need to catch more when water is available

• ‘Peak season’ pressure on assets/services as tourism increases in warmer, drier summers (combined with projected population growth and changing demographics)

• Additional water treatment may be needed to manage increasing saline intrusion resulting from sea level rise (combined with possible deteriorating raw water quality due to pollution)

• Tighter wastewater treatment standards may be required to protect rivers in low flows if they become more common in hotter, drier summers.

UKCP09’s projected trends for less sub-zero temperatures would reduce the risk of cold snaps and the disruption and damage they cause. However, note that latest evidence finds that global warming may actually result in colder, snowier winters for the UK because of changes to atmospheric circulation patterns caused by melting Arctic sea ice.

Increasing challenge of managing excess water:• More frequent, more severe rainfall events causing all types

of flooding and increasing the risk of pollution incidents (e.g. from Combined Sewer Overflows)

• Increasing risk of coastal flooding and erosion because of sea level rise

Increasing risk to wellbeing and productivity of the workforce operating in more frequent and more severe extreme events.

Borrowing and insurance costs may increase due to being seen as a riskier business.

Cascade impacts caused by failures in our supply chain, e.g. electricity providers, chemical suppliers, who will all face similar pressures to us from climate change.

Making the case

Driver for employee engagement, incremental regulated investment, innovation and operational change. Can use recent historic weather events and ‘very likely’ climate change projections to inform ‘low regrets’ decisions and to ‘make the case’ to Ofwat and others.

Developing the case for investment or new approaches at PR14 and beyond is likely to involve more extensive analysis and optioneering than has been typical. This will require committed expertise and resource.

Responding to climate change and weather resilience presents an opportunity to engage with customers and stakeholders, and to work in partnership. Joined-up messages around changing weather, water conservation, water heating and more sustainable living generally.

Demonstrating customers’ Willingness to Pay for (or Accept) measures to ensure long term resilience may be challenging due to long timescales and public scepticism. Engagement with the Customer Forum and other groups will be required.

This is a long term issue for the business which is likely to require an evolutionary response with progressive investment and operational responses each Asset Management Period (AMP).

In the long term, the increasing challenge to water availability may drive significant investment needs, which may challenge affordable bills.

Achieving our vision and strategic objectives

Response activities for climate change align with developing approaches on sustainable drainage solutions (SuDS), catchment management and ecosystem services.

Response activities may conflict with objectives such as lower energy and carbon (e.g. embedded carbon in construction, operational carbon in tighter treatment standards/increased pumping).

An effective response programme could be used to demonstrate leadership and the Yorkshire Water vision.

In the long term, Government may legislate for radical change to the structure of the water industry in order to respond to climate change and other pressures.

The increasing challenge of managing excess water supports the need for a new approach to flood management, an area in which YW can add value and expertise.

21Adapting to climate change and enhancing resilience to weather

*Please visit yorkshirewater.com/climatechange for more information, including the Appendix document.

Yorkshire Water

A national perspective

Our own conclusions on risks and opportunities are confirmed by Defra’s findings in the recent national climate change risk assessment. Highlighted priority areas that may have “the greatest need for action within the next five years” include risks that directly relate to our core services and operations:

Water resource management

“By the 2050s, between 27 million and 59 million people in the UK may be living in areas affected by water supply-demand deficits…”

Flood and costal erosion risk management

“Annual damage to UK properties due to flooding from rivers and the sea currently totals around £1.3 billion. For England and Wales alone, the figure is projected to rise to between £2.1 billion and £12 billion by the 2080s…” (Defra, 20129)

Some differences can be seen between YW and Defra’s risk assessments, reflecting our local priorities. For example, we recognise a priority risk to the role of upland peat management in protecting raw water quality in many areas of Yorkshire.

Water Availability

Water use/ recreation

Social &

Economic

Biophysical

LowFlows (1,5)

Change in recharge &

low gwl (4,6)

Increased demand for water

(32,33,35)

Supply-Demand Def icit

(7)Water quality

(18, new)

SewerFlooding/CSO

spills (8,22)

PipeBursts/leakage

(15, new)

Change in Reservoir yields

(2,17)

Hydropowerpotential

(9,23)

Habitatchange (10)

Flooding ofcritical

inf rastructure (16)

Lack of cooling water

(34)

Increased water temp.

(40)

Increasedevaporation

(38,39)Erosion &

sedimentation (3,20,25)

SalineIntrusion/

incursion (53,54,55)

Pollutionincidents(indirect)

(49)

Water supply quality (12,27)

Algalgrowth(41,43)

Improvedtreatment process

(42)

Odour atworks(50)

Chlorinedepletion

(52)

Deterioration Of MEICA

(21,36)

Pests at works (37)

SludgeRelateddisease

(45)

MajorDrought (11,24)

Lower sewer

basef lows (13, new)

Water-based

recreation(49)

Reducedf inancial rating ofwater companies

(31)

River/canalNavigation

(new)

Dam failure(new)

Water-borne

disease(47)

Discolouration (44)

Crypto (19)

Figure 3.1 Clustering of impacts into themes

23

(Defra, 201220)

When focusing on the water sector (primarily water and wastewater companies) the national climate change risk assessment identified 34 risk themes, summarised in the diagram below:

6. Conclusions

Chapter summary• The climate and weather are critical to the sustainability of YW and its services.

Climate change presents opportunities and risks to the business

• The UK Climate Projections (UKCP09) are widely regarded as the best information available to incorporate climate change into planning decisions. However, research confirms that no model is likely to project the full range of potential future climates. Therefore detailed analysis combined with expert judgement is required

• To inform early action, data on past events can be combined with the ‘very likely’ range of climate projections to inform ‘low regrets’ decisions. Inaction would itself be a growing risk

• Climate change will be an issue for many decades. Knowledge will continue to develop and the response will be iterative and evolutionary. Every employee will have a role in our response to climate change.

External context

Defra, 20118 “The future is never easy to predict, but we have solid evidence that the way we use water and manage our water resources needs to change…

“[A] consistent message is that beyond, and perhaps even before, 2050 we can expect reduced water availability and increased pressure on the capacity of our drainage systems. We must plan and prepare now if we are to reduce these risks…

“Our response cannot simply be more of the same – predicting future demand and building capacity to meet it – the financial, environmental and carbon costs would be too high. We must capture more water when it is plentiful and use water more efficiently.”

As with all modelling and future projections, there is inevitable uncertainty in the precise degree of change to be expected. This can not act as a barrier to action. YW deals with uncertainty in many areas and the strategic climate change risk assessment shows that inaction is itself a growing risk. By examining recent weather events and the best available evidence, YW can conclude the following:

• The climate and weather are critical to the sustainability of a water and wastewater service provider. The national climate change risk assessment includes ‘water resource

management’ and ‘flood and coastal erosion risk management’ among the six areas that may need action in the next five years (Defra, 20129). Climate change presents a strategic risk to the business. In order to manage this risk it is critical to understand how the changing climate might impact assets and services, and how to mitigate those impacts. UKCP09 is widely accepted as the best information available for incorporating climate change into planning decisions in the UK. Latest research can be used to complement UKCP09.

Adapting to climate change and enhancing resilience to weather

Yorkshire Water

• There is scientific agreement that the climate is changing in response to human greenhouse gas emissions. There is increasing evidence that climate change is already detectable in recent weather, both globally and in the Yorkshire region. Looking forward, there is confidence in the general trends for changing precipitation patterns, warming, sea level rise and more frequent, more severe extreme weather events.

• The business already manages the impacts of extreme weather events and recognises the need to further improve the resilience of its assets and services.

• Early action and planning are essential for an effective response. The Government and our regulators have made clear that they expect water companies to start preparing now (Defra, 20118 and EA, 201117).

• An effective strategy will include a range of operational and investment responses. The Cabinet Office (20111) identifies four themes of natural hazard resilience measures: resistance, reliability, redundancy and response and recovery.

• YW can not manage climate change in isolation. Climate change is one of many factors shaping the business. Therefore integrated risk management and decision making is essential. Partnership working with suppliers and stakeholders is needed to ensure an effective response.

• Climate projections show steady change over the coming decades, rather than any specific tipping point(s). Furthermore, uncertainty in the data increases with time and research confirms that no climate model is likely to capture the full range of possible future climate change (URS, 201110). Therefore careful analysis and expert judgement are required, particularly for long term or sensitive decisions. Defra (201216) state they expect the decision maker to be satisfied that there are not critical features of a design of new wastewater infrastructure which may be seriously affected by more radical changes to the climate beyond that projected in the latest set of UK climate projections.

• To inform early action, levels seen in past extreme events and data from the ‘very likely’ range of the projections can be used to inform ‘low regrets’ decision making. The ‘very unlikely’ range of the projections can be used to inform the likely worst case. Uplift factors to account for uncertainty will be important.

• Defra and the EA have recently referenced the UKCP09 medium emissions scenario in their analysis for the Water White Paper (Defra, 20118 and EA, 201117). The national climate change risk assessment analysed risks under all three emissions scenarios, with focus on the medium scenario (Defra, 201220). Global emissions currently exceed the medium scenario and are on a rising trajectory. Therefore, the high emissions scenario could be more appropriate for planning purposes. Communications with the industry and its regulators is necessary to define an agreed approach to managing the inherent uncertainty of climate change projections.

• The approach to enhancing resilience to today’s weather, and to tomorrow’s climate will be most effectively managed as one joined-up strategy. Communication and collaboration will be an important part of this strategy. It will be essential to work with academia, customers, Government, regulators, suppliers and other stakeholders to ensure an effective and integrated approach. An early priority is to engage with Ofwat and others to secure agreement on our approach to decision making about climate change and extreme weather for PR14.

• Climate change will be an issue for the business for many decades. Knowledge will continue to develop for many years (decades) and the response will be iterative and evolutionary. Every employee will have a role in our response to climate change.

• Climate change presents opportunities to drive innovative and sustainable investment and operations. Addressing known vulnerabilities will support more reliable services. Planned effectively, we can demonstrate our leadership.

25

7. Short term action plan

Chapter summary• YW recognises that it needs to enhance its resilience to today’s weather and to tomorrow’s climate

• To do this, the business needs to understand the potential impacts of climate change and the action needed to both enhance resilience to today’s weather and adapt to tomorrow’s changing climate

• Recognising this priority, our Adaptation Strategy Group is overseeing the four phase project which will support our PR14 proposals and longer term planning

• The approach to enhancing resilience to weather today and adapting to the changing climate can be effectively managed under one joined up strategy. Communication will be a key part in this approach.

External context

Defra, 20118 “We will look for assurances that water companies’ water resource plans will collectively deliver a water supply system which is resilient to the impacts of climate change…

“We want companies to reflect the broader context of supply challenges through to 2050…

“[A] new strategic statement will set a clear expectation that Ofwat will use its regulatory powers to deliver the longer term imperatives set out in this White Paper, with assumptions and funding decisions looking beyond the immediate five year planning period… incentivising a more sustainable approach to water resources.”

Climate change presents a series of opportunities and risks to a business which relies on the climate and weather for its core services. YW recognises that it needs to enhance resilience to today’s weather and to tomorrow’s climate. Meeting these needs is intrinsic to our business objectives. Responding effectively to the changing climate goes to the heart of our vision: taking responsibility for the water environment for good.

To build a sustainable business it is imperative that we understand the potential impacts of climate change and the action needed to both enhance resilience against today’s weather and adapt to tomorrow’s changing climate.

Recognising this priority, we established the Adaptation Strategy Group (ASG) in 2011. The ASG is the cross business group of colleagues who are working together to lead the development of our approach to climate change adaptation.

There is inevitable uncertainty when modelling the future and we are continuing to advance our understanding in this rapidly evolving area. Therefore, to inform effective action we will use levels seen in past extreme events and data from the ‘very likely’ range of climate projections to inform ‘low regrets’ decisions. Extensive assessment will be essential, particularly for long term or climate-sensitive decisions.

Adapting to climate change and enhancing resilience to weather

The ASG is leading the four phase climate change project which will inform PR14 and longer term planning. The information obtained from Phases 1 and 2 of the project has supported the development of this position paper. Phases 1 and 2 were supported by our partner URS.

Our four phase project: • Phase 1: Impact and vulnerability assessment

(Completed December 2011). This provided a comprehensive understanding of the UK Climate Projections (UKCP09) and a high level review of learning taken from recent extreme events (URS, 201110).

• Phase 2: Strategic climate change risk assessment (Completed March 2012). Informed by Phase 1, this has undertaken YW’s most thorough climate change risk assessment to date. The output has been a climate change risk register which has informed our strategic risk system (summarised in Appendix 4*). We are integrating the strategic climate change risks alongside all other risks in our risk framework to ensure active climate change risk ownership and monitoring.

• Phase 3: Detailed climate change risk assessment (April to December 2012). Focusing on the priority risks identified in Phase 2, we are undertaking detailed assessment (i.e. asset and/or service level) to inform operational and investment needs. We are planning to use internal and UKWIR research and tools to support this assessment. In this assessment we plan to use past weather extremes and the ‘very likely’ UKCP09 data to inform ‘low regrets’ decisions. The ‘very unlikely’ UKCP09 data can be used to inform the likely worst case. Uplift factors to account for uncertainty will be important. Economic assessment, sensitivity analysis and expert judgement are likely to be needed to manage the inherent uncertainty where climatic parameters are central to decision making.

• Phase 4: Detailed policy position (Q4 2012/13). The learning from Phases 1 to 3 will be used to establish YW’s detailed policy position on the potential impacts of climate change and the planned response. This will form the basis for our PR14 position on climate change. The diagram below summarises our priority areas of focus.

Yorkshire Water

We recognise the need to further enhance the resilience of our assets and services to today’s weather, and to tomorrow’s climate. As part of this strategy, our ASG plans to:

• Think beyond existing activities to demonstrate our leadership

• Develop a policy on resilience to weather and climate change

• Define current and desired levels of resilience for key business functions.

Communication will be an important part of our approach to enhancing resilience to extreme weather and adapting to climate change.

A plan for extreme weather and climate change communication will be developed by our ASG, including:

• Raising internal awareness (linking to other relevant sustainability matters, particularly carbon), and through engagement with specific teams and individuals

• Updating the executive management team and our PR14 Steering Group at key milestones

• Communicating (internally and externally) the climate change and resilience to weather policy, as it develops

• Engaging with customers, Government, investors, regulators and stakeholders. A priority is to engage with Ofwat to secure agreement about our approach to decision making about climate change and extreme weather for PR14

• Demonstrating expertise and leadership.

27Adapting to climate change and enhancing resilience to weather

2. Water Resource Management PlanOur most advanced area of climate change assessment. Will follow latest EA guidance. Supply

Demand

4. PR14 commentaryOverview of our leading assessment, integrated approach and future plans. Our detailed policy position (Phase 4).

3. Weather resilience planPriority sites for enhanced resilience. Joined up strategies and plans. Outputs from investigations/research.

Cold weather

Drainage

Catchment management

Asset flooding

Design standards

Sea level rise and tidal surge

Coastal erosion

Asset maintenance

1. A comprehensive data and knowledge programmeA detailed programme of projects to further our understanding and inform effective decision making.

Research and investigations

Modelling

Monitoring

*Please visit yorkshirewater.com/climatechange for more information, including the Appendix document.

Keighley Moor Reservoir in Winter, West Yorkshire

Yorkshire Water 29

8. Long term strategy

Chapter summary• Our climate change strategy will evolve as knowledge develops. Our response will

be iterative, continually improving each Asset Management Period (AMP) in line with latest understanding

• A diagram presents the key tasks of the climate change strategy and its connectivity with other business activities.

External context

Environment Agency, 201121 “The future for water is uncertain. Climate change, population growth and lifestyle changes mean that careful planning is needed to ensure sustainable water supplies for people, businesses and the environment. It is important to get this right now because planning and implementing changes can take many years. The current regime is already beginning to show limitations.”

It is clear that climate change will be an issue for the business for many decades. The current and short term activities outlined above will inform both early action in PR14 and longer term planning. The diagram below summarises the key tasks involved in the climate change strategy, and its connection to other business activities.

There may be fundamental change to the industry, or to our understanding, which would significantly alter our climate change strategy.

Therefore, our position will be kept under regular review. Flexibility will be central to an effective long term strategy which will inevitably continue to evolve as knowledge develops. The business response will be one of continual improvement, with iterative responses developing each AMP in line with latest understanding.

We plan to update this document as our understanding develops.

Climate change and weather resilience strategy

Sustainability factors

Rising energy costs

Rising resource costs

Clim

ate is changing

Grow

ing population

Grow

th in households

Diverse custom

er base

Technological change

Affordability

Financeability

Skill resource

Societal demands

CCRA project

Research and investigations

Water Resource Management

Planning

Flood resilience

Emergency planning

Comms plans

Ongoing activities

Adapting to climate change and enhancing resilience to weather

Climate change and

weather resilience strategy

Enhance resilience to today’s weather and maintain levels of service in the

changing climate

External policy

and research

developments

Set d

esig

n st

anda

rds

Prioritise risks

in line with

objectives

Modelling,

research and

investigations

Mitigate

risks through

operations and

Investment

Risk performance(current vulnerability)Act

Plan

Monitor

Customer

expectation

(willingness to

pay/accept)

Develop climate

change policy

position

Clarify language, roles and responsibilities

Under

stand

ing

risks

and

oppo

rtunit

ies

Robu

st

data

Intern

al an

d

exter

nal

com

mun

icatio

n

Lear

n

Yorkshire Water 31Adapting to climate change and enhancing resilience to weather

References

1. Cabinet Office (2011). Keeping the country running: Natural hazards and infrastructure.http://www.cabinetoffice.gov.uk/resource-library/keeping-country-running-natural- hazards-and-infrastructure

2. Met Office (2010). Evidence: The state of the climate.http://www.metoffice.gov.uk/media/pdf/m/6/evidence.pdf

3. Georgia Institute of Technology and Institute of Atmospheric Physics, in PNAS February edition (2012). Impact of declining Arctic sea ice on winter snowfall.http://www.pnas.org/content/early/2012/02/17/1114910109

4. University of Oxford, in Nature vol 470 (2011). Anthropogenic greenhouse gas contribution to flood risk in England and Wales in autumn 2000.

5. Met Office (unknown date). The wet autumn of 2000 (web page).http://www.metoffice.gov.uk/climate/uk/interesting/autumn2000.html

6. Acclimatise and UKCIP (2006). The adaptation tipping point: Are UK businesses climate proof?http://www.ukcip.org.uk/wordpress/wp-content/PDFs/CDP4_UK.pdf

7. International Energy Association (2011). From their website but no longer visible.

8. Defra (2011). Water white paper: Water for life.http://www.defra.gov.uk/environment/quality/water/legislation/whitepaper/

9. Defra (2012). Summary of the findings from the UK climate change risk assessment 2012.http://www.defra.gov.uk/environment/climate/government/risk-assessment/

10. URS Scott Wilson and CCRM, for YW (2011). Climate change risk assessment, Phase 1: Impact and vulnerability assessment.

11. Committee on Climate Change: Adaptation Sub-Committee (2011). Adapting to climate change in the UK - measuring progress.http://hmccc.s3.amazonaws.com/ASC/ASC%20Adaptation%20Report_print_spreads.pdf

12. Met Office (2011). Warming – A guide to climate change.http://www.metoffice.gov.uk/climate-change/guide/

13. University of Edinburgh and University of Victoria in Nature, vol 470 (2011). Human contribution to more-intense precipitation extremes.

14. IPCC (2007). Climate change 2007: Synthesis report.http://www.ipcc.ch/publications_and_data/ar4/syr/en/mains1-2.html

15. National Oceanographic Centre (Unknown date). Unknown title.http://www.pol.ac.uk/ntslf/products.php

16. Defra (2012). National policy statement for wastewater: A framework document for planning decisions on nationally significant wastewater infrastructure.http://www.defra.gov.uk/environment/quality/water/sewage/waste-water/

17. Environment Agency (2011). Case for change: Current and future water availability.http://www.environment-agency.gov.uk/research/planning/135501.aspx

18. Ofwat (2010). Resilient supplies.http://www.ofwat.gov.uk/publications/focusreports/prs_web_1011resilience.pdf

19. HM Treasury and Infrastructure UK (2011). National Infrastructure Plan 2011.http://www.hm-treasury.gov.uk/national_infrastructure_plan2011.htm

20. Defra (2012). Climate change risk assessment for the water sector.http://www.defra.gov.uk/environment/climate/government/risk-assessment/

21. Environment Agency (2011). Case for change: Reforming water abstraction management in England.http://www.environment-agency.gov.uk/research/planning/135501.aspx

22. Met Office, for Ofwat (2010). Changes in the frequency of extreme rainfall events for selected towns and cities.http://www.ofwat.gov.uk/sustainability/climatechange/rpt_com_met_rainfall.pdf

23. Mott MacDonald, for YW (2011). YWS climate change trends: Climate change evidence and trend analysis for Yorkshire.

To discuss our climate change strategy please contact:Gordon Rogers Climate Change Manager 01274 804549 gordon.rogers@yorkshirewater.co.uk

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