Many businesses are currently engaged in actively working on their climatic impact – i.e. to reduce their emissions of greenhouse gases. At the same time, however, it is important for businesses to be adapted to a changed climate, by preparing for the new challenges that will be presented by increased global warming.
Many businesses require input goods – for example, in the form of water, energy or raw materials. It must therefore be possible for input goods to be produced and supplied at a reasonable price.
Access to water
The amount of accessible water in Sweden may be affected by changes in precipitation and temperature. In south-eastern Sweden in particular, there is an expected increase in the average number of days with low water levels in rivers. Of all the water that is extracted for use in Sweden, 2/3 is used by industry. A reduction in the accessibility of water may result in restrictions on water extraction being more common.
Extreme weather events have a major effect on the energy supply, as high temperatures, flooding, strong winds and storms can cause operational disruptions. Many of the interruptions to the electricity supply can be attributed to weather-related problems. Climate change will result in certain events taking place with greater frequency and severity than is currently the case. Storms are not expected to be made worse by the change in climate. However, there may be an increased risk of damage, with trees falling across electricity power lines, particularly as a result of a reduction in ground frost.
The change in climate may result in changes to the possibility of producing raw materials, in Sweden and in other countries. With regard to foodstuffs, for example, many countries may experience a deterioration in conditions for cultivation, whilst Sweden could experience better conditions for certain crops.
The international transportation of goods may become more difficult as a result of rising sea levels and the increased frequency and intensity of extreme weather events. This could lead to consequences such as protracted delivery times, reduced confidence in trade partners, and increased costs.
Fixed properties and financial aspects
A changed climate may increase the risk of buildings being exposed to damage or becoming unsuitable for the continuation of their current use. Insurance costs and investments may also be affected.
The changed climate will increase the risk of flooding, intensive heatwaves, fires, landslips, landslides and erosion. This may also have a knock-on effect on factory buildings, warehouses and offices. The expected effects of climate change are different for different geographical regions, and are also affected by differences in building techniques and materials.
An increased population – whether temporary or permanent – may present opportunities for Sweden in the form of increased demand for goods and services, and greater access to labour and skills.
Today, Swedish companies are offered comprehensive insurance protection against climate-related damage, which is relatively unique. In many European countries, it is no longer possible to take out private insurance for climate-related damage. Even some of Sweden’s insurance companies have begun to review their policies for construction at sites with greater vulnerability to climatic conditions.
Although Sweden’s insurance industry is relatively national in nature, it is exposed to the international situation by means of international reinsurance. Increased instability and financial losses in many parts of the world are therefore expected to affect the insurance industry, which will need to show greater consideration to the changes in climate and the associated risks.
The effects of changes to the climate, such as increased temperatures, rising sea levels and changes to precipitation patterns, are almost certain to have an impact on financial assets. Swedish direct investments in other countries may be affected, as will the direct investments of other countries in Sweden. Investors are increasingly taking into account how companies’ long-term strategies include consideration to potential changes to the climate.
Goods and services
Changes to the climate may result in new opportunities, although there may be a reduction in demand for current goods and services.
New goods and services
A deterioration in the conditions for production in other countries may increase the opportunities for Swedish exports – possible examples include foodstuffs, energy and wood. At the same time, international deliveries may become more difficult, which will impact the exporting of goods in the same way as the importing of raw materials.
There may also be a market for innovative solutions and services in connection with climate adaptation – both in Sweden and internationally. In addition, the demand for consumer goods may be also be affected by a changed climate – for example, there could be an increase in the demand for fans, drinks, ice cream, and green, cooling solutions, together with declining demand for warm winter clothing and ice skates.