The worst climate risks are those we don’t know about. We can’t prepare for them, says ESG expert at Czech energy group ČEZ

Floods, heatwaves and strong winds are among the main climate risks that energy group ČEZ must be prepared for. Almost all facilities have a lifespan of 20, 25 or 30 years, so 2040 and 2050 are the key time horizons for us, says Dušan Vácha, an ESG expert at the energy group.

Energy group ČEZ is preparing for climate risks by not relying on a single way of generating electricity. “At each site, there is no longer just one technology; in almost every case, there is a combination of combustion-based sources—currently coal, natural gas and biomass. If one facility encounters a problem, another can continuously take its place,” says the ČEZ Group expert.

Your ESG report describes climate risks such as drought, heatwaves, extreme precipitation and wind in detail. Which do you consider the greatest?

From our perspective, one of the biggest risks is flooding, which is partly related to climate change. Forecasts indicate that this effect will intensify. However, even in the relatively recent past, we have experienced floods in Czechia, so the risk of flooding is relatively well understood here. We have flood maps and know which areas will be inundated in the event of a ten-year, hundred-year or five-hundred-year flood. The ČEZ Group’s companies are working to adapt to this risk—either proactively, by building outside flood zones, or by taking it into account where infrastructure has to be located in a vulnerable area. However, all climate risks are challenging because you prepare for what you know, but you cannot prepare for what you don’t know.

For example, one of the towers carrying power to or from the Dlouhé Stráně pumped-storage hydropower plant was damaged. It is very difficult to prepare for a situation like this. It is not feasible to have two transmission lines to a power plant, for either economic or environmental reasons. In the event of a fault, the priority is therefore to restore the facility’s operation as quickly as possible so it can once again continuously provide its associated services.

Can you give examples of specific measures ČEZ has had to take at its power plants to adapt to climate risks?

One example is the diversification of energy sources. Each site no longer relies on a single technology; in almost every case, there is a combination of combustion-based sources—currently coal, natural gas and biomass. If one facility encounters a problem, another can take its place. This is not necessarily related to climate change, but the same kind of combination is also planned at the new sites in Dětmarovice. There will be a gas-fired boiler, cogeneration units and a biomass boiler house, so the facilities can back each other up.

You published your report this spring, and then several heatwaves followed, during which nuclear power plants across Europe had to be shut down because of water shortages. Was that a risk in Czechia?

That has not happened here so far. All Czech nuclear and gas-fired power plants use cooling towers, which means they consume less water. On the other hand, although the French had to shut down power plants, we have no information that they were short of electricity. So it is purely an economic decision whether to generate or not—in other words, whether to import electricity or not. This could become a much bigger problem in the future, however, because many impacts cannot be predicted.

Power plants abroad have been shut down not only because of water shortages. At one plant, for example, an intake pipe became clogged after jellyfish multiplied there. A few weeks ago, there was also a report that South Africa’s only power plant had to be shut down because its intake pipe was clogged with dead fish that had been affected by a virus. We don’t know whether the fish multiplied because of warm water linked to climate change or for some other reason. However, there are many risks that are very difficult to prepare for. That is why I say the bigger problem is what we don’t know, rather than what we suspect and can prepare for.

How far ahead do you prepare for climate risks?

For ČEZ, the initial impetus was legislation and the need to meet the requirements of the EU taxonomy. The logical criterion is that climate risks should be assessed over the lifespan of the facility in question. Almost all facilities have a lifespan of 20, 25 or 30 years, so 2040 and 2050 are the key time horizons for us. 2040 is relatively close, and climate models do not produce such widely varying results; by 2050, however, they do. So for 2040 we use one development scenario, while for 2050 we use two alternative scenarios.

You probably adjust them as the situation gradually changes…

We expect that whenever the climate scenarios are updated, we will have to update our assessment of climate risks for all our energy sources.

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This article is sponsored by ČEZ.