Energy systems are exposed to both sudden shocks and long-term pressures. Storms, floods, and wildfires can damage power lines, substations, fuel infrastructure, and transport routes. Heatwaves can increase demand for cooling and strain electricity grids. Drought can reduce hydropower output and limit water available for cooling thermal power plants.Â
Energy risk is not just about blackouts. It can also show up as higher prices, voltage issues, fuel shortages, grid constraints, connection delays, or unreliable supply during peak demand.Â
Vulnerabilities
What are the risks to a business's energy supply?
The climate and nature pressures that can disrupt power, fuel, heating, and cooling.
Energy systems are exposed to both sudden shocks and long-term pressures. Storms, floods, and wildfires can damage power lines, substations, fuel infrastructure, and transport routes. Heatwaves can increase demand for cooling and strain electricity grids. Drought can reduce hydropower output and limit water available for cooling thermal power plants.
Energy risk is not just about blackouts. It can also show up as higher prices, voltage issues, fuel shortages, grid constraints, connection delays, or unreliable supply during peak demand.
How exposed are energy sources and infrastructure?
How exposed business sites, suppliers, and energy infrastructure are to climate disruption.Â
A business may be more exposed if its sites, suppliers, or key markets depend on fragile grids, fuel routes, water-stressed power systems, flood-prone infrastructure, or wildfire-exposed transmission lines.
Energy exposure can also sit outside a business's own operations. A supplier may rely on power from a stressed grid. A warehouse may depend on refrigeration during heatwaves. A data provider may rely on energy-intensive infrastructure in a region facing grid constraints.
Understanding where energy comes from, how it reaches the business, and which sites or suppliers depend on reliable energy can help identify where disruption is most likely to start.
How sensitive are businesses to energy disruption?
How much the business relies on energy being reliable, affordable, and available when needed.
Some businesses are highly sensitive to energy disruption because even a short outage or price spike can cause major problems. This is especially true for businesses that rely on continuous production, refrigeration, heating, cooling, data systems, transport, precision equipment, or customer-facing services.
A business may be more sensitive if it has no backup power, limited ability to shift operations, little energy storage, high energy costs, or processes that cannot easily be paused. Sensitivity can also be high where energy disruption would damage stock, interrupt customer service, or create safety risks.
How could energy disruption create wider knock-on effects?
How energy shocks can create wider knock-on effects across operations, suppliers, and customers.
Energy disruption can quickly affect more than one site. A power outage can stop production, close shops, disrupt payment systems, affect refrigeration, delay deliveries, and prevent employees from working.
A heatwave can increase cooling demand, strain the grid, raise energy prices, and affect workers at the same time. A fuel shortage can disrupt transport, supplier deliveries, and customer access. Grid constraints can delay new sites, expansion plans, or electrification projects.
This means energy risk can become a wider business issue, affecting operations, costs, investment plans, suppliers, customers, and growth.
