A step-by-step guide for utilities managing physical climate risk

Posted: July 11, 2025

Last year, the U.S. experienced 27 independent billion-dollar weather and climate disasters, causing combined losses of $182.7 billion. It was the second-highest number ever and evidence of a clear trend: extreme weather is getting worse. 

Those numbers only capture the biggest single disasters, obscuring the fact that many utilities now face more severe drought and rainfall, storms, wildfires and cold waves on a regular basis. The impact is self-evident, from downed power lines to plant outages and lengthy clean-up and repair efforts. 

Utilities are by now used to planning for these disasters, recognizing that investing in resilience is often more cost-effective than rebuilding after the fact. Duke Energy expects to spend around $75 billion over the next 10 years to harden infrastructure and modernize systems across the company’s utilities in Florida and the Carolinas, for example. 

How utilities can assess physical climate risks 

Another factor driving these efforts is that regulators in 14 states now require resilience plans from regulated utilities.^[1]

Until recently, however, each company—whether acting on regulatory mandates or simply striving for best practice—largely had to draw up those plans on its own, without much guidance or a larger framework to pull from. 

That’s why, three years ago, industry research group EPRI set out to bring utilities together to hammer out a common approach. The result, which it calls Climate READi (the Climate REsilience and ADaptation Initiative), provides a large library of guidance, references and tools to help companies plan, design and operate their infrastructure with resilience in mind. 

"Strengthening the electrical grid to be more resilient against extreme weather will be one of the sector's biggest challenges for years to come," says Steve Powell, president and CEO of Southern California Edison, one of more than 40 utilities that collaborated on the effort. 

In the first instance, the framework is meant to help utilities assess their actual physical climate risk. That requires understanding the science behind climate change-related hazards to the energy system, and what climate models are available to predict how local conditions could change. 

Detailed guidance is then meant to walk utilities through a standardized process to assess the climate-related vulnerabilities for different asset classes in their locales, so they can identify options for adaptation. 

Finally, it details how both climate and asset vulnerability data should feed into power system planning and simulation models, so companies can decide how to respond and adapt—and make the case for resilience-related investments. 

It could be a big deal: such a comprehensive set of science-informed models to evaluate adaptation investments was not previously available to utilities, Andrea Staid, EPRI’s principal technical leader for electric sector climate resilience, told Utility Dive ahead of the launch. 

How storm-induced outages could change under climate change 

To illustrate the applications of the framework, EPRI created several intriguing case studies. 

One of them, produced with the Pacific Northwest National Laboratory, mapped how climate change could affect the risk of hurricane-induced power outages—one of the major disaster impacts keeping power companies up at night. 

The researchers coupled synthetic storm tracks under both current and future climate conditions with predicted power outages resulting from each storm, in order to pinpoint trends along the U.S. Gulf and Atlantic coasts. (A big caveat: the study looked at only one potential pathway for greenhouse gas emissions between 2066 and 2100.) 

The model forecasts a dramatic rise in risk along the entire coastline: in Houston, New Orleans and Boston, for example, it showed outages per person per decade rising by at least 70%, while Miami saw a 119% increase. 

Parts of Florida could expect to see severe outages—affecting more than half the people in a county—up to three times per decade, up from only one to two at most under current conditions. 

How utilities can prepare for extreme weather 

When it comes to resilience investments, knowing which hazards will come to bear when and where can help to narrow down and prioritize from a long list of options: 

• Extreme heat can require modifying or increasing active cooling equipment to combat higher outage rates for thermal generators. Utilities may also simply have to add more generation and grid capacity to service higher loads. But heat response can also mean changing protocols to protect employees who have to work outdoors, for instance, servicing power lines.
  
  
• Wildfires present a wide range of responses, too, from vegetation management to undergrounding power lines to accelerated maintenance and repair programs—all meant to lower the risk of blazes breaking out in the first place. PG&E, for example, has buried more than 800 miles of power lines since 2021, and plans for an additional 770 miles by 2026. Better capabilities to measure weather and moisture conditions, or forecast local weather, can also help to stay on top of fire risk.
  
  
• Storms can require flood protection for low-lying equipment or relocating assets out of floodplains altogether. Increasing vegetation maintenance and hardening infrastructure can also protect assets from wind and debris damage. Houston’s CenterPoint Energy installed over 26,000 stronger, storm-resilient poles and cleared 6,000 miles of higher-risk vegetation as part of its preparations for the 2025 hurricane season, for instance. 

EPRI’s framework, the group hopes, will help less experienced utilities navigate the rapidly changing landscape of climate risk, so they can tackle the challenges posed by extreme weather and fill in any analytical gaps. 

“There are important questions around what the power system is going to look like moving forward,” Morgan Scott, director of the Climate READi program, told Latitude Media. “And what the framework gives [utilities] is the process by which they can evaluate what is the environment that those assets might live in for the next 20, 30, 40 years, and how do we use that to inform whether there is a change that’s needed for existing assets, or whether you design and build new assets in a different way.”