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Climate Change Risk Assessment (CCRA)

Climate Change Risk Assessment (CCRA) stands as a pivotal tool in our collective effort to understand, prepare for, and mitigate the multifaceted risks posed by a changing climate. Learn more about what it is and the effect it can have on organizations, with Minimum.

What is the CCRA?

Climate Change Risk Assessment - or the CCRA for short - evaluates the risks associated with climate change. Governments and organizations may conduct CCRA to:

Inform policy decisions
Develop adaptation strategies
Enhance resilience in the face of a changing climate

In compliance with the mandates outlined in the Climate Change Act of 2008, the UK government has initiated the third quinquennial evaluation of climate change risks within the country.

This assessment relies on the Independent Assessment of UK Climate Risk, which constitutes the official recommendations from the Climate Change Committee (CCC). The CCC, commissioned by both the UK government and devolved administrations, provides statutory advice for this crucial evaluation.

What is CCRA3 specifically?

CCRA3 is the third review of the Climate Change Risk Assessment in the UK. It was released on the 17th January 2023, and replaced CCRA2 which was published in January 2017. The very first iteration was published in 2012.

CCRA3 found that with a 2°C temperature rise by 2050, economic damages for eight specific risks could surpass £1 billion annually each. Consequently, the overall cost of climate change to the UK is projected to reach a minimum of 1% of GDP by 2045. In an effort to limit the impact, the UK government states that it has:

Invested a record £5.2 billion to build 2,000 new flood defenses by 2027
Continued work on the Green Finance Strategy to align private sector financial flows with clean, environmentally sustainable and resilient growth
Increased the total spend from the Nature for Climate Fund on peat restoration, woodland creation and management to more than £750m by 2025.
Ensured that climate science and research, such as the UK Climate Projections 2018, are fully integrated into planning and decision making, including on major infrastructure.

Why is the Climate Change risk assessment important?

The risk assessment encompasses sixty-one climate risks and opportunities across various sectors of the UK economy. It prioritizes the following eight areas for immediate action:

Risks to the viability and diversity of terrestrial and freshwater habitats and species from various hazards
Risks to soil health resulting from heightened occurrences of flooding and drought
Risks to natural carbon stores and sequestration posed by multiple hazards
Risks to crops, livestock, and commercial trees arising from various climate hazards
Risks to the supply of food, goods, and essential services due to the climate-induced breakdown of supply chains and distribution networks
Risks to people and the economy resulting from climate-related failures in the power system
Risks to human health, well-being, and productivity stemming from increased exposure to heat in homes and other buildings
Multiple risks to the UK originating from the impacts of climate change overseas

How does CCRA impact organizations?

Depending on which sector an organization is part of, CCRA can have a huge impact on operations. For example, in the UK the flagged risks to human health might impact the day to day running of private and public health services. The risks surrounding food supply could have a very real impact on agriculture and FMCG businesses such as supermarkets.

On a more granular level, the overarching goal of limiting the average global temperature to below 1.5 degrees (in line with the Paris Agreement) means that CCRA decisions can have an impact of businesses that don’t fall into any of the target sectors called out in the most recent iteration. For example:

Risk and identification	CCRA helps organizations identify and understand climate-related risks that may directly or indirectly affect their operations. This includes risks related to extreme weather events, supply chain disruptions and regulatory changes.
Regulatory compliance	CCRA often informs and influences government policies and regulations related to climate change. Organizations need to stay abreast of these developments to avoid legal consequences, financial penalties, and reputational damage.
Business continuity	The assessment helps organizations anticipate and plan for potential disruptions to their operations. This involves evaluating vulnerabilities in the supply chain, infrastructure, and other critical components of the business.
Innovation	CCRA can serve as a catalyst for innovation as organizations seek new technologies and strategies to adapt to changing climate conditions. This may involve the development of climate-resilient products, services, and processes.

How Minimum can help

Minimum can help organizations to understand their existing carbon output, and create plans to mitigate climate related risks in the future. Our Emissions Data Platform seamlessly collects and processes emissions data from every corner of your organization and supply chain - no matter the format. Making it the ideal platform for emissions audits and all-round business intelligence.

Get in touch to learn how Minimum can bring visibility and control to your organization's carbon footprint.