The risks of climate change are beginning to be priced into public and private investments in infrastructure, according to Michael Bonanno of Breckinridge Capital Advisors, a financial services firm based in Boston and San Diego.

“As data about climate change gets better, bond managers will integrate it into the risk analysis,” Bonanno, vice president and municipal sustainability lead, said during a Climate Week 2020 web conference sponsored by Breckinridge and Ceres, a sustainability nonprofit organization that works with influential investors and companies. “We are learning together, [which is why] communication between the investment world and bond issuers is important.

“ESG (environmental, social and corporate governance) factors, including climate change, are fundamental to our assessment” of investments, including public bonds that fund infrastructure and corporate bonds, he added. “We want to see that the bond issuers acknowledge the risks and we want to see mitigating factors” in the plans. As data grows, “more investors are going to be including these factors in their assessments.”

One difficulty in assessing climate risks is that there are no standardized measurements, he added.

Grant Ervin, Pittsburgh's chief resilience officer, said it is important to get the community to accept the need to mitigate climate change risks when proposing projects rather than trying to fix damage to infrastructure after it happens.

“This is the frontier we are on now,” Ervin said. “I’m not sure local governments are there yet. We need to show the public how they can save money in the future” by preventing risks now. “In some cases it is a life and death situation.”

At the same time that future infrastructure damage can be prevented “we can reduce the carbon footprint of a city while building in resilience,” added Carolyn Kousky, executive director of the Wharton Risk Center at the University Pennsylvania. “Some pre-disaster federal grants are available for this work, but the work is paid for overwhelmingly with local and state money.”

But “is the FEMA model of paying for recovery over and over again sustainable?” Kousky asked. “That is a really important policy question. After a disaster, people want to get their lives back to normal as quickly as possible. That time is not the time to have this debate.”