Measurabl’s Physical Climate Risk Exposure (PCRX) feature enables users to identify and understand their physical climate risks and opportunities across their real estate portfolio for seven different climate risk hazards including floods, heatwave, coldwave, water stress, hurricanes & typhoons, sea-level rise, and wildfires.
See below for frequently asked questions regarding PCRX:
Differences between S&P Trucost and Moody’s Physical Risk Data?
- S&P does not have risk levels
- S&P Trucost has an extreme cold risk factor
- Moody’s Physical Risk Data has an earthquake risk factor
|Floods / Fluvial Flood||Heatwave / Extreme Heat||Extreme Cold||Water Stress||Hurricanes / Typhoons / Tropical Cyclone||Sea-level Rise / Coastal Flood||Wildfires||Earthquakes|
|Moody’s Physical Risk Data||√||√||√||√||√||√||√|
What are physical climate risks?
- Risks arising from the physical effects of climate change can directly affect the value of assets. Physical climate risks can be acute or chronic in nature, with acute risks encompassing extreme events such as floods, droughts, and storms, and chronic risks referring to longer-term, slower onset changes such as rising temperatures and sea-level rise.
Who provides this physical risk data for PCRX?
- S&P Trucost is a leader in carbon and environmental data and risk analysis, S&P Trucost assesses risks relating to climate change, natural resource constraints, and broader environmental, social, and governance factors.
- Moody’s Physical Risk Data is a leading provider of data and analysis on physical climate and environmental risks.
Who has access to this feature?
- Groups who purchase PCRX have access to this feature
- Buildings: any building that has been enrolled in the integration will be accessible via the PCRX dashboard.
- Users: Group/Subgroup Members and Managers will have access to the PCRX dashboard.
How does S&P Trucost source climate risk data and calculate risk scores? How is their approach different from Moody’s Physical Risk Data?
- S&P Trucost sources their data on climate risk and modeling from industry-standard sources. One key difference is that S&P maps properties to more precise locations than Moody’s Physical Risk Data when calculating physical climate risk.
- Detailed information on data sources and methodology for both sources is available here.
- S&P Trucost does not provide data on earthquake risk, as does Moody’s. Most customers are not using the earthquake data from Moody’s Physical Risk Data, as they often address earthquake risk through both local regulations and insurance policies.
How often is PCRX data updated?
- S&P Trucost adjusts their scores as they receive updated information from climate models, data on more recent weather conditions, and more precise mapping of climate risks. These updates occur around once a year.
- Moody’s Physical Risk Data integrates updated climate data as it is available which varies based on climate hazard, but can often be over the longer timeframes of scientific research which can be 5-6 years.
What is Moody’s Physical Risk Data’s data coverage?
- Moody’s Physical Risk Data can score virtually any onshore/terrestrial location globally for the climate hazards of heat stress, water stress, floods, sea-level rise, hurricanes & typhoons, earthquakes, and wildfires.
How are Moody’s Physical Risk Data’s risk scores calculated?
- Moody’s Physical Risk Data and analytics rely on best-in-class, peer-reviewed climate models and environmental datasets from the IPCC, NASA, NOAA (the National Oceanic and Atmospheric Administration), and others, and is supplemented by commercially available data sources.
- Each hazard risk score is calculated based on several indicators that capture different dimensions of risk presented by the hazard. Assets receive a score from 0-100 (percentile) for each hazard and are assigned a risk threshold, ranging from low risk to red flag, or highest risk, based on the score.
What risk categories does PCRX support?
- Earthquakes (Moody’s Physical Risk Data)
- Extreme Heat / Heatwave
- Extreme Cold (S&P Trucost)
- Water Stress
- Tropical Cyclone & Typhoons
- Coastal Flood
What are Moody’s Physical Risk Data risk levels?
- For each risk category, the risk scores fall into different risk levels: No Risk, Low Risk, Medium Risk, High Risk, and Red Flag.
What are risk category indicators?
- Indicators are metrics that are measured to calculate the risk score. Each one is chosen to capture a different dimension of risk presented by the hazard.
What does Red Flag Mean?
- Red Flag is the highest risk level a building can have. For heat stress and water stress, “Red Flag” means that an asset falls in the 5 percent most exposed properties of all facilities in the Moody’s Physical Risk Data "Investible Universe". Floods, hurricanes & typhoons, and sea-level rise are based on absolute thresholds due to the binary nature of risk for these hazards, where an asset is either susceptible or not, and “Red Flag” signifies that an asset is highly exposed to historical and/or projected risks.
- More details on the methodology behind PCRX can be found here.
Why did Moody’s Physical Risk Data move from absolute scores to percentile-based scores?
Scores had bunching around certain scores based on where the buildings were geographically. Having percentile-based scores alleviates bunching and scores are more flat across the whole scale.
To start understanding the physical climate risks and opportunities of your portfolio, sign up for Measurabl today.