Climate Change and Energy Infrastructures Risks And Opportunities

1. Climate Change and Energy Infrastructures Risks And Opportunities Cleo Paskal Associate Fellow , Energy, Environment and Resource Governance Chatham House, London Adjunct Professor, SCMS, Kochi, India cp@cpaskal.com

2. Three challenges -- and three opportunities – in a time of climate change - 1. Vulnerable energy infrastructure in coastal areas - 2. Vulnerable energy infrastructure in cold climates - 3. Legal infrastructure poorly designed for changing geophysical circumstances

3. 1. Vulnerable energy infrastructure in coastal areasWhen Katrina hit the U.S. Gulf Coast in 2005 it was, at most, a Category 3 in a known hurricane zone

4. When Katrina hit the U.S. Gulf Coast in 2005 it was, at most, a Category 3 in a known hurricane zone

5. Oil and Gas In the Gulf CoastUS Gulf Coast states refine around 30 per cent of the US oil supply and the Gulf itself produces around 25 per cent of domestic oil supply and 15 per cent of natural gas supplies

6. Katrina was an expected phenomenon in an expected location. Yet it still caused massive disruptions to the US, and global, hydrocarbon market.

7. Damage caused by Katrina and Rita, 2005 • 457 damaged pipelines (Minerals Management Service) • 113 Platforms destroyed (Minerals Management Service) • US Gulf Coast refines around 30% of US oil supply. Katrina alone shut down 9 of 17 refineries in hurricane zone • Oil production in Gulf Coast dropped to 57.37 of normal output, natural gas dropped to 40.35% (DoE) • Spikes in global prices. Shell’s Mars Platform, post-Katrina

8. After Katrina and Rita, much of the infrastructure was rebuilt in the same place. Result: In the summer of 2008, Hurricanes Gustav and Ike caused the shutting down of much of the Gulf offshore production, spiking global prices again. Ike alone destroyed 49 offshore oil platforms and shut 12 of 31 oil refineries in Texas and Louisiana.

9. Climate change will make the US Gulf Coast energy infrastructure even more vulnerable (DoT) 1 meter sea level rise could permanently flood: • 24% of interstate highways • 72% of the area’s ports • 9% of the rail lines • 3 airports. Storm surge of 18 feet (Katrina brought in a storm surge of 25-30 feet) could flood: • 51% of interstate roads • 98% of ports • 43% of freight facilities • 33% of rail miles • 22 airports

10. The US is about to make major investments in infrastructure. Unfortunately, so far, current US infrastructure planning rarely takes into account the likely effects of climate change.

11. Opportunity for India: Infrastructure Pioneer In many areas India is putting in infrastructure for first time. It has the chance to do it in a manner that will be less affected by climate change. India has advantages that the West had 100 years ago, with excellent engineers, inexpensive labour and (relative) access to capital. With the added bonus of skilled climate forecasters. It could position itself as a leader in ‘climate change proof’ infrastructure, creating more stability at home, and the possibility to export expertise to places that need it.

12. 2. Vulnerable energy infrastructure in cold climates

13. Energy Infrastructure on permafrost • Blue: Electrical transmission lines • Yellow: Pipelines • Red: Bilibino nuclear station Source: Nature

14. Effect of climate change on energy infrastructure in cold climates • Pipelines, storage tanks, roads, railways, etc., built on permafrost potentially become substantially more unstable and expensive. • Ice roads have shorter windows, requiring more flying-in of supplies, increasing expense. • Increased erosion, landslides and slope instability add to disruptions and expense

15. Opportunity for India: India and the Arctic India is a pioneer in methane hydrate extraction. Methane at least 20x more potent a greenhouse gas than CO2. There are potential vast fields of methane hydrates in the Arctic, which are likely to become unstable with warming. Extracting and using that methane before it can escape could be considered essentially a form of ‘carbon capture’, potentially qualifying it for climate change mitigation financial mechanisms.

16. 3. Legal infrastructure poorly designed for changing geophysical circumstances. Case study: U N Convention on the Law of the Sea

17. Our legal infrastructure is as ill-equipped for climate change as our physical infrastructure 200miles

18. Our legal infrastructure is as ill-equipped for climate change as our physical infrastructure 200miles

19. A bit more complicated

20. Bangladesh

21. A bit more on borders

22. South China Sea

23. Pacific

24. Opportunity for India: Shape Global Debate • All legislation/regulations/incentives/subsidies/etc. must incorporate the geophysical realities caused by environmental change in order to assure that the legislation, etc., helps resolve disputes, and doesn’t create unnecessary problems. • This is a potential leadership role for India. For example, in the case of shifting borders, India can lead the way in negotiating for time-fixed baseline for coastlines.

25. We are heading into an era in which limiting loss will be just as important as promoting growth. It is no longer enough just to think about our impact on the environment. We also have to think about -- and plan for -- the environment’s impact on us.

26. Thank you.