Climate risk expert says New Zealand needs a national flood adaptation platform to mitigate the rising costs and financial risks caused by floods

A climate risk management firm specialising in climate impact assessment and adaptation says New Zealand's flood management is inadequate and a national flood adaptation platform is needed.

At an all-day climate inquiry public meeting last week, the company ClimSystems submitted to the Finance and Expenditure Committee (FEC), urging the inclusion of a flood adaptation platform in the Government’s new climate adaptation framework.

In May, Climate Change Minister Simon Watts tasked the FEC with developing the objectives and principles for a climate adaptation framework.

This framework will outline how the Government shares the costs of preparing for climate change impacts.

The company's Managing Director, Peter Urich, told the FEC NZ needs a national-scale flood data and information sharing platform.

ClimSystems creates, develops, and markets software for assessing the impacts of and adapting to climate variability and change.

“We feel that flooding is a major issue right now that has been underrepresented,” Urich told the select committee.

“We believe that we need to create a national scale flood data and information sharing platform.”

Ulrich said high quality historical data is now available through national weather service provider Metservice, and the firm also works closely with weather research agency NIWA. 

“There's data out there, really high quality and future climate model data, with now increasing supporting digital elevation data,” Urich said.

ClimSystems has spent the past 20 years working on NZ’s experience with flood issues. It proposed in its climate inquiry submission that a national-scale flood data and information-sharing platform with granular flood information should be created.

This platform would enable people to search for and identify current and future flood risks at the asset level. ClimSystems said in its submission council flood maps would be “collected and curated” on this platform for public use.

 Urich told the select committee NZ’s flood adaptation plans need to align with climate standards and regulations – and that different groups need to work together, including central and local government.

Councils are actively looking at what they can do around flood resilience. For example, Auckland Council’s Making Space for Water programme, part of its 2024-2034 Long-Term Plan. 

The programme aims to boost the region’s resilience to flooding and climate change in response to the Auckland Anniversary Floods and Cyclone Gabrielle in 2023.

But Urich is concerned varying approaches to flood adaptation planning by different councils will lead to a “mixed” approach.

“So that's why we're talking about a national unified approach,” he told the select committee last week.

ClimSystem’s early beginnings started at the University of Waikato through the International Global Change Institute over 30 years ago. The software ClimSystems uses was developed through the Institute and was originally designed for sea level rise modeling.

Privatised in 2003, ClimSystems has since worked with 40 countries on climate insights, flood modeling, regulatory reporting, and property climate risk.

High-profile projects the company has worked on in that time includes the 2022 FIFA World Cup in Qatar and Expo 2020 in Dubai.

Urich told interest.co.nz earlier this week he hopes the Government will include a flood adaptation platform in their climate inquiry.

The FEC is set to provide recommendations and principles on the climate framework and report back to Watts on September 5th.

Urich put the total cost to build and run a flood adaptation platform at between $5 million and $10 million, adding that a storm in one neighborhood could wrack up that amount in damages alone.

“The big thing with all of this, and I think the main driver of all of it, we find when we talk to people is dollars and cents. When it becomes a financial issue, then it becomes something that people pay attention to,” he said.

But he believes the private sector is going to drive change around flood adaptation before central government does.

“I’m encouraged by world movements in the private sector. And I think ultimately it's got to be through a private-public sort of relationship – we’ve got to do this together at one level,” he said.

“But [with] the lack of movement in the public sector, the private sector will get on with things because they need to be insured, they need to protect the bottom line and such. And I think they've recognized that they can be hurt.”

The latest insurance data from the Treasury indicates a rise in the number of insurers setting flood risk prices based on specific addresses.

This is based on data from the month of April 2024, which was released earlier this week. 

It showed that insurance availability remains – generally – strong for flood-prone areas. The maximum Estimated Flood Premium (EFP) this quarter was around $4,500, up 12.5% or $500 from the previous quarter. 

That EFP in the data is based on a $500k insured property, with higher premiums expected for more valuable properties.

In low flood risk areas, 17.6% of quotes increased by 3.9% from the previous quarter, while in high flood risk areas, 24.7% of quotes rose by 6.3%.

Since October 2022, the Treasury has been collecting quarterly data on residential insurance prices and availability through actuary Finity Consulting.

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