“Much of the focus of climate change adaptation is on transport infrastructure. It is important, however, to extend the definition of ‘infrastructure’ to include logistical facilities such as distribution centers and freight terminals which, because of their location and design, are often vulnerable nodes in supply chains,” Alan McKinnon pointed out.
The nature of logistics operations and the design of freight vehicles can influence the extent to which transport infrastructure needs to be “climate-proofed.” “If, for example, logistics providers were to invest in more robust vehicles and build more redundancy into their systems, it might be possible to reduce the spending required for infrastructural protection,” McKinnon said. Much of the “climate-proofing” of infrastructure and the wider adaptation of the built environment to climate change will be logistics- and carbon-intensive. It will therefore offset some of the planned carbon savings from mitigation efforts in the logistics sector. Where a risk audit reveals that a logistics facility or system has high exposure to climate risk, it can be difficult for a company to decide on the nature and scale of its response, given current levels of uncertainty about the probability and intensity of the climate impacts. “Some companies may simply outsource more of their logistics, effectively off-loading the climate risk to others,” he said.
Finally, McKinnon made it clear that: “The ability of a carrier to withstand or react to extreme weather events may become an important competitive differentiator in the logistics sector. It is still unclear, however, how businesses and markets will adjust to transport systems becoming increasingly disrupted by climatic forces.”