David Espinoza, Ph.D., PE (Maryland) contributed to a paper entitled “Risk and Resilience – Addressing Physical Climate Risks in Infrastructure Investment” that was published by the Coalition for Climate Resilient Investment (CCRI) in November 2021.

The paper was coauthored by CCRI Advisors Lucy Carmody and Alexandre Chavarot. David Espinozas co-contributing editors were Gaia De Battista, Executive Director at Lions Head; Murray Birt, Senior ESG Strategist at DWS; Chris Canavan, Partner at Lions Head; Chris Dodwell, Head of Policy and Advocacy at Impax Asset Management; Nisha Krishnan, Senior Climate Finance Associate at World Resources Institute; Gianluca Minella, Head of Infrastructure Research at DWS; Carlos Sanchez, Executive Director at CCRI; Gireesh Shrimali, Precourt Energy Scholar at Stanford University; and Alan Smith, ESG Risk and Inclusion Senior Advisor at HSBC.

David Espinoza is a Senior Principal Geoenvironmental Engineer based in Maryland. He leads the firms efforts to develop a consistent and transparent framework for valuing investments in real assets (e.g., renewable energy, solid waste, mining, hydropower) taking into consideration risks from different sources including physical risks (e.g., climate change). He also provides engineering services associated with siting and closure design of containment facilities for municipal waste and industrial byproducts (e.g., municipal solid waste, mining tailings storage facilities, coal-combustion residuals), and serves as an expert for slope stability of dams, reinforced earth berms, and natural slopes for forensic failure investigation of geo-structures (e.g., roads, dams, reservoirs) to support insurance claims and/or develop remedial design. 

CCRI was launched at the UN Climate Action Summit in 2019 as a private sector-led initiative, that supports investors and policy makers to better understand and manage physical climate risks. With over 120 members and $20 trillion in assets under management, CCRI spans governments, international organizations, institutional investors, insurance firms, technical institutions, ratings agencies, and private financial institutions. By bringing together industries and leaders across the political, technical, and investment world, CCRI is pioneering solutions that are both innovative and practical to ensure all infrastructure investments incorporate physical climate risks and advance climate resilience.

Description

This paper focuses on the need to incorporate physical climate risks in infrastructure design and investment decision-making. It presents how CCRI is addressing the “climate resilience market failure through the development and implementation of tools, methodologies, and principles to help the various stakeholders involved in infrastructure, including the financial industry, build resilience to a changing climate.

“Risk and Resilience – Addressing Physical Climate Risks in Infrastructure Investment” describes how the lack of analytical tools to quantify the exposure of infrastructure to physical climate risks is one factor leading to low investment in resiliency and adaption; and showcases the decoupled net present value (DNPV)–a method developed by Geosyntec–as a framework solution to ameliorate this circumstance. As noted in the report, application of DNPV offers the possibility for better pricing of real assets, more realistic expectations for returns, and better-informed investment decisions.

More Information

Learn more about the article: Risk and Resilience – Addressing Physical Climate Risks in Infrastructure Investment
Learn more about CCRI: Coalition for Climate Resilient Investment
For consultation regarding climate resiliency investing, contact David Espinoza at despinoza@geosyntec.com.
Learn more about David at: David Espinoza (geosyntec.com)