Mass-cargo-affine industries and climate change

Abstract

The impact of low water periods on inland navigation and companies is well known by ship-operators and companies that rely on this mode of transport but it is rarely a topic of climate impact research. As climate change might affect the frequency and intensity of low water periods, quantifying the impact of climate change on companies and the effects of possible adaptation measures is vital. In this study, we present a model for quantifying the impact of low water events on companies which rely on inland navigation and apply that model to three anonymous iron and steel companies along the River Rhine. The deviation of optimal storage, the storage level that evens out risk vs. fixed capital, is used in the model to measure the vulnerability of companies. The results show that, depending on the climate scenario, the companies might have to deal with either one or five additional days of empty storage in the near future (2021–2050) and up to nine more days by the 2071–2100 period. Seasonal analysis shows that, consistent with the change in the river discharge, the biggest deviations from optimal storage level occur in the late summer/early autumn. Analysis of adaptation options shows that companies would need to increase storage capacity by 2.5 % for the 2021–2050 period, and by 25 % by the 2071–2100 period. A reduction of ship sizes is not an adaptation option for the three companies in this study, because these companies already use relatively small vessels. This is however an efficient adaptation option for companies which employ larger vessels for transport. Another adaptation option would be to reduce the share of transportation via inland waters, but the feasibility of this option depends on the availability and cost of other modes of transport.