Climate change and impact on construction

By Peter Dolamore ,

Advisory Risk Partner, Construction Specialty

09/05/2023 · 8 minute read

How UK companies are future-proofing against extreme weather events

Extreme weather is on the increase in the UK, with climate change affecting both temperatures and rainfall. The country is experiencing increasing intensity of rainfall, with 2011-2020 being 9% wetter than 1961-1990, according to the Met Office’s, State of the UK Climate report.

Additionally, a special report issued by the Met Office also suggests the UK has been experiencing higher maximum temperatures and longer warm spells in recent years.

With the increase in both the intensity and severity of extreme weather events, what are the implications for UK contractors?

With the UK Government’s growth priorities, forming part of its broader “Levelling Up” agenda, infrastructure spending has increased over the past decade, resulting in more construction projects. Spending in the sector will also be key to driving economic recovery after the COVID-19 pandemic and the disruption to global trade caused by the war in Ukraine. In addition to its £100 billion commitment between 2022 and 2025, the UK Government has indicated that funding will increase from 1.1% to 1.3% of GDP from 2025, representing billions of extra pounds earmarked for preparing infrastructure such as transport, energy, water, waste, and digital networks for the future.

This economic growth will take place over the next 20 to 30 years, against a backdrop of fast-moving technological change in construction and the probability of increased physical impacts, resulting in climate change.

Unpredictable weather affects both construction timelines and budgets. Research has found that extreme UK weather extends project timelines by up to 21%, with flooding and flood management costing the country about £2.2 billion each year. And industries with “exposed” workers lost £94 million to extreme heat in 2021.

During the July 2022 heatwave, which saw temperatures climb in excess of 40ºC, many contractors introduced personal protective equipment for working in heat, and set up water stations. Still, monthly construction output decreased 0.8% in July 2022, or £114 million, compared with June. This was the second consecutive decrease in monthly construction output, following seven consecutive months of growth in the sector between November 2021 and May 2022, and was partly blamed on the weather.

As projects become more audacious in terms of scale and geography, there is demand for more intelligence around climate risk and how this will be managed. In order to retain a competitive edge, and to remain able to operate in these conditions, contractors are recommended to take action to understand, characterise, and address these risks and improve resilience against them.

What are the implications of climate change and extreme weather on large-scale infrastructure construction projects?

Effects on design

As the severity of extreme weather increases over time, so too will its impact on the buildings of the future. If not accounted for, changes could in turn outpace the climate-related tolerances set at the time of design.

Climate mitigation and adaptation should be an integral part of the design process. Low carbon building materials and efficient design help to mitigate additional contribution to climate.

Considerations around building separation, quality of foundations, elevation, combustible materials, and wind and heat tolerances must not only have to cope with today’s environment, but potentially the most extreme environment the future has to offer. Moreover, for larger and more complex projects, where a construction timeline might stretch for a decade or more, climate change projections will need to be incorporated into the construction and commissioning phases, as well as the asset’s anticipated lifespan, once complete.

Additionally, incorporating thermal efficiency into building design goes beyond making it more “resilient by design”. It also reduces the asset’s carbon footprint, and could reduce the energy intensity of the building for tenants and residents, ultimately making it more attractive in high energy cost scenarios such as worsening fuel poverty, increased cost-of-living, and uncertain energy security. Commercial tenants also increasingly expect low carbon buildings to deliver on their net zero commitments, so heat efficient building design can also deliver longer term value.

Construction businesses and industry bodies are already starting to address these issues through the development of data pools, analytical techniques, and tools to support forward-looking design considerations. However, while these tools are becoming more adept at addressing physical risk, they often omit the insurability of assets in the context of a changing climate. Seeking advice related to insurance implications of climate change predictions as early as possible in an asset’s feasibility and design phases can therefore make significant savings and avoid budgetary slippage.

Effects on physical works

The effects of climate change will also increasingly need recognition during physical works. Climate change is expected to bring increased intensity rainfall events, a poleward movement of tropical storms, and more variation in extreme hot and extreme cold days.

Increased winds will affect lifting operations and work at height. Extreme heat and dry conditions will impact the risks associated with hot works. Changing water tables will affect excavation, tunnelling, and a site’s susceptibility to flooding. Considerations will also have to be made in respect of the storage of plant, equipment, and materials on site, particularly if they are vulnerable to adverse weather prior to installation. For example, cross-laminate timber can be particularly sensitive to wet conditions, meaning consideration of material storage is critical.

For large complex projects with decades-long timelines, climate change may need folding into long-tail planning. Feasibly, average temperatures may rise, so as to be impactful over the lifespan of the construction process. However, for the majority of projects, the key to managing climate risk will be monitoring conditions, developing mechanisms for early warning, and ensuring sites and processes are resilient and responsive to extreme events, and that people are protected. Here again, a data-led approach is vital, and an informed and supportive insurance partner will ensure that this analysis is embedded into risk transfer programmes and mitigation recommendations, reducing construction risks and optimising a project’s insurability and success.

Effects on people

Above all, the risks posed to workforces by the increased incidence and severity of weather must be understood and mitigated against. In the UK, there is a duty of care, especially for staff members who by law have to wear certain levels of protective equipment.

There is currently no legal maximum limit set on outside temperatures for work to continue outdoors. Guidance suggests a minimum of 13ºC to 16ºC if employees are carrying out physical work. Extreme heat and sun exposure can cause dehydration, dizziness, fainting, and heat stroke. Flooding and snowfall can also cause delays as workers are unable to reach sites, and result in potential safety issues when they return to work. The site worker is therefore on the front-line of all of these hazards and can suffer the most severe effects of these risks’ mismanagement.

Incorporating real-time and future weather assessments into health and safety planning is therefore becoming more and more important, but happily, more feasible, due to the advent of responsive and dynamic risk tracking and training tools to support this. The construction industry already understands the importance of placing workforce safety at the heart of everything it does, and will therefore undoubtedly lead the way in ensuring that its people are protected from the weather-related hazards of the future.

The state of the construction insurance market

The construction insurance market has gone through a clear transition, moving from one that experienced stable or declining pricing for over a decade to one in which prices have been rising, but with some moderation in terms of price rises moving into 2022 and subsequently into 2023.

The market is expected to remain challenging in the near future, with underwriters continuing to heavily scrutinise each individual project. Insurers will seek detailed risk information that will undergo in-depth review. Insurers also have net zero commitments and will also be increasingly curious about carbon intensity.

How to gain optimum insurance terms

Understanding the risk of climate change and extreme weather events is critical to effective risk management. Modelling the physical impacts of climate change can aid contractors in developing holistic and right-sized risk management practices to reduce harm to employees and ensure that assets are “resilient by design”, ultimately reducing the opportunity for projects to slip.

Businesses should work with a broker who has experience in construction, coupled with expertise around the physical risk associated with environmental extremes. With their combined market, scientific, and technical expertise, brokers come into their own during a period of tightening insurance conditions. In order to gain the most effective insurance for their projects, decision-makers should start working with their brokers and environmental advisory teams as early in the process as possible, to ensure they secure the best intelligent insurance programme they can achieve, underpinned by a risk management strategy that minimises the likelihood and impact of loss.

Article

Climate change and impact on construction

How UK companies are future-proofing against extreme weather events

With the increase in both the intensity and severity of extreme weather events, what are the implications for UK contractors?