Climate Financing for Marine Transport: Analyzing the Impact of Climate Adaptation Investments in Inland Waterways

The U.S. inland waterways play a vital role in the domestic economy, but extreme weather events (e.g., floods and droughts) perennially threaten to disrupt their operations. Exacerbating these concerns, climate change is expected to increase the frequency and severity of these disruptions in the future. However, despite these known risks, researchers have devoted little attention to evaluating the financial implications of climate change on inland waterway supply chains. Traditional financial valuation methods do not facilitate an accurate quantification of long-term risks associated with investments in climate resilient infrastructure, which leads to a systemic under-investment in resilience and adaptation. Here, the research team proposes to develop a state-of-the-art, data-driven approach to evaluate climate financing strategies for inland waterways based on future costs of inland waterway supply chain disruptions due to climate change. The approach integrates the decoupled net present value (DNPV) with climate modeling, simulation methods, statistical models, and economic models. Using this methodology, the team evaluates cases where investments in resilient, water-borne infrastructure can offer cost-effective means of mitigating projected impacts of climate change. Although the team demonstrates their methodology for disruptions due to droughts and floods along the Mississippi River, their framework can be easily extended to other regions and sections of the inland waterways as well as other transportation modes and infrastructure sectors. The project paves the way for researchers being able to quantify the return on investment from climate adaptation strategies based on economic impacts of climate change on inland waterway supply chains and can help policymakers better allocate funding for mitigating future supply chain disruptions.

Language

• English

Project

• Status: Completed
• Funding: $140052
• Contract Numbers:

  69A3551747130

• Sponsor Organizations:

  Office of the Assistant Secretary for Research and Technology

  University Transportation Centers Program
  Department of Transportation
  Washington, DC  United States  20590
• Managing Organizations:

  Maritime Transportation Research and Education Center

  University of Arkansas
  Fayetteville, AR  United States  72701
• Performing Organizations:

  Vanderbilt Center for Transportation Research (VECTOR)

  Box 1831, Station B
  Vanderbilt University
  Nashville, TN  United States  37235
• Principal Investigators:

  Baroud, Hiba

  Johnson, Paul

  Philip, Craig

• Start Date: 20221003
• Expected Completion Date: 20230630
• Actual Completion Date: 20230630
• USDOT Program: University Transportation Centers

Subject/Index Terms

• TRT Terms: Climate change; Drought; Financing; Floods; Infrastructure; Inland waterways; Investments; Supply chain management
• Geographic Terms: Mississippi River
• Subject Areas: Finance; Marine Transportation; Planning and Forecasting; Security and Emergencies;

Filing Info

• Accession Number: 01863184
• Record Type: Research project
• Source Agency: Maritime Transportation Research and Education Center
• Contract Numbers: 69A3551747130
• Files: UTC, RIP
• Created Date: Oct 31 2022 9:26PM