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EBI on Assessing Climate Risk: Look Decades into the Future (VIDEO)
In part three of a three-part video conversation moderated by Connect CRE founder and CEO Daniel Ceniceros, EBI Consulting’s Mike Eardley and Will Duggan break down the components of a climate risk assessment. Part one of the video series focused on measuring the sustainability level of a commercial property, while part two details how to implement measures that will bring about improvement.
ESG program manager with EBI, Duggan says that when it comes to climate risk assessment, there are two sides. One is physical risk and the next is transition risk.
Looking at physical risk, “we like to give our clients a full picture of what these risks look like not only in 2021, but what they look like in 2035, 2051, 2060,” he says. The ESG team plugs various stressors into the model, such as flooding, and project whether the client need to put mitigation efforts into place over the next 30 or so years to protect against these risks.
Transition risks are more associated with policy changes and changes in public opinion. “We’re seeing ordinances pop up all over the country with regard to energy efficiency and steps to improve that,” says Eardley, director of energy and sustainability at EBI. “
While New York City has been a leader in implementing these ordinances, other cities are following suit. Here again, EBI plugs in various policy changes that may occur and how they would affect the property.
Adding challenge to making these assessments is the fact that states as well as cities may differ widely, not only in terms of their approaches but also in terms of what stage they’ve reached in implementing them. “It’s a moving target,” Eardley says.
Click on the video below for the full conversation.
- ◦Policy/Gov't
