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MINERVA CLIMATE LOCATION INTELLIGENCE: climate risk information for every location

By Gioachino Roberti 

Climate Change 

If you live in Canada, you have had a tangible experience with Climate Change. No longer is climate change just something you read about in the news or something that is impacting the distant glaciers. It is something you have seen out of your window during an extreme atmospheric river, it is something you have felt on your commute to work during the heat dome. The International Panel on Climate Change (IPCC) has recognized in its reports the negative effects of climate change on our life. We know disasters are becoming more frequent and more severe and that they will strike, but what are we doing as Canadians to protect ourselves?  

In 2021, British Columbia, Canada had first-hand experience on the adverse effect of climate change on people’s well-being: historical heatwaves, wildfire, and floods devastated the province, with estimated damages exceeding C$7.5 billion (about $1470 per person in BC) from flooding alone (BMO 2021).  

With numbers like that, which taxpayers and business owners are responsible for covering, we need to become more proactive, adapting to the reality of climate risks. Being proactive means breaking down the damage and the costs of climate disasters to understand where to prioritize adaptation investment. For example, when considering the 2021 flooding in British Columbia, the disaster losses are the sum of direct asset disruption (e.g., bridge collapses and house damage), as well as indirect damage through disruption of economic activities (e.g., supply chain, farming), and their repercussions on the economy. One major consideration is the real estate market: about 20 percent of British Columbia’s economy is based on the real estate market – 19.8 percent in 2020 (Statistics Canada 2022), and this sector of the economy is especially vulnerable to climate risks. Canadian households now owe $1.82 for every dollar in disposable income and the average household has $122,000 of mortgage debt, up 16 percent from 2019 (Statistics Canada).  

There are two ways Canadians invest in real estate: by directly buying property and by buying financial products containing property. Mutual funds and exchange traded funds (ETFs) increasingly contain real estate investment trust (REIT) properties, making it easier than ever to invest in Canadian real estate. 

But this simplicity may be blindsiding us to the risks involved in buying properties. 

False Creek in Downtown Vancouver, British Columbia, Canada.
False Creek in Downtown Vancouver,
British Columbia, Canada.

Vancouver risk scores show that 9 percent of new buildings are in a 1 in 100-year flood zone, implying a 22.2 percent chance of being flooded in a 25-year time span – the length of a typical mortgage (Canadian Climate Institute 2020). For reference, the 2013 Calgary flood was a 1 in 100-year event (Calgary river flows – historical data). Nation-wide analysis on sample REIT properties shows that 17 percent are in a 200-year flood zone , which means an 11.8 percent likelihood of being severely flooded within a 25-year time span (Canadian Climate Institute 2021).  

This means that Canadians investing in real estate are exposed to a high probability of loss in case of a natural catastrophe, and they have no means to know whether their assets and investments are safe.  

How do Canadians, investors and companies find the relevant data to understand the exposure of their assets and investments to physical climate risk?    

Knowledge is the first step to reducing investment risks. 
Knowledge is derived from data.  

But where is the data??  

It is notoriously difficult to track down which assets are exposed to which natural catastrophes. In Canada, climate risk information is limited and where it exists it is hard to gather. There are no nationwide flood hazard maps, nor comprehensive wildfire information. Moreover, the necessary data to produce flood and wildfire hazard maps is spread across a wide range of public and private databases, stored in different data formats and standards. Portfolio managers, property managers, municipalities and home owners need simplified access to this data. A better solution is needed. 

Minerva Intelligence, through its experience in data, natural hazards and AI, has been working on projects funded by the federal government to remedy these longstanding gaps by updating the national flood hazard data layer, the hydrological network and is building a prototype to assess climate risk on the Canadian Coastal zone. Today, Minerva is developing a platform to make this knowledge available to all. Users can search for locations and easily access state-of-the-art information needed to understand climate risk exposures. These datasets include nationwide flood hazard maps, wildfire probability maps, and other climate variables. With this knowledge, Canadians will be empowered to take the right steps to face climate change.  

  


Head of Product (Climate)

Dr Gioachino (Gio) Roberti is a climate hazard and risk expert, leading the vision and development of climate85 products and services.