Evaluating the performance of UK flood defenses under climate change

The background

Flood defenses

Flood defenses play a vital role in protecting people and properties against flooding in the United Kingdom. As climate change increases flood risk over the coming decades, the frequency and severity of floods will increase. This will reduce the effective protection of the United Kingdom’s flood defenses as the likelihood of flooding overtopping defenses increases.

Moody’s has conducted work in partnership with Flood Re to examine how climate change could impact flood defense outcomes for York, England, and Pontypridd, Wales. The study projects forward to 2040 — this is when the Flood Re scheme will have reached the end of its lifespan (in 2039) and the UK insurance market will have transitioned back to risk-reflective pricing for flood.

York

Situated in northeastern England, York has a population of approximately 200,000 people. The city is highly exposed to flooding, primarily from the River Ouse that passes through the city’s center and from tributaries. Surface water flooding is also a risk as seen during the United Kingdom’s summer 2007 flooding.

The city has been repeatedly impacted by floods in recent years. Boxing Day floods in 2015 impacted over 600 homes and led to a £45 million ($58 million) defense investment in the York Flood Alleviation Scheme (which concluded at the end of 2023).

The city has seen recent flooding from Storms Bella, Dennis, and Franklin, among others. York is generally protected to the 100-year level of severity, with some limited areas protected above and below this.

Pontypridd

Situated in South Wales, Pontypridd has a population of more than 30,000 people. Flood risk is characterized by infrequent severe flooding from the River Taff and more frequent but less severe surface water flooding.

Pontypridd was severely impacted by Storm Dennis in 2020, with more than 150 properties flooded and depths of up to 1.8 meters (nearly 6 feet). Flooding was caused by the River Taff overtopping its banks and was exacerbated by surface water from excess rainfall.

The standard of protection of flood defenses for Pontypridd varies from the 1-in-25-year level of severity up to a maximum level of 1-in-100 years in the most central areas. This level was exceeded during Storm Dennis, which was the most severe flood event since 1979.
 

The overview

Moody’s and Flood Re considered a severe flood scenario for residential properties in York and Pontypridd using Moody’s Industry Exposure Database for the Moody’s RMS™ UK Inland Flood HD Model combined with the Moody’s RMS UK Inland Flood HD Climate Change Model. The study examines the impact of two climate scenarios in 2040 (Table 1) and how strengthening flood defenses can offset some of the impacts.

The study considers:

•  The cost of property damage for the present day, with existing defenses as a baseline
• The impact of a high- and low-emissions climate pathway on the baseline in 2040, holding other variables constant to illustrate the impact of climate change alone
• The impact of increasing flood defense standards of protection under two strengthening scenarios for the high- and low-emissions climate scenarios

Assumptions — severe flood scenario

The 1-in-50-year return period loss event is chosen — meaning it is an event of such severity that it would recur, on average, only once every 50 years. For context, the largest UK flood event of recent years was the 2007 summer flooding, which is estimated as having a return period of between 30 and 45 years. Losses were estimated at £4 billion ($5.1 billion) in 2007, and the Association of British Insurers estimated 57,000-74,000 properties were flooded.

Climate pathways

Representative Concentration Pathway (RCP) 8.5 is selected as the more pessimistic climate outcome for the 2040 projections. RCP 8.5 describes an emissions scenario leading to warming of more than 4˚ Celsius (39˚ Fahrenheit) by 2100. RCP 2.6 is selected as the more optimistic climate outcome for the 2040 projections. It describes a lower-emissions pathway leading to warming of less than 2˚ Celsius (more than 35˚ Fahrenheit) by 2100.

Defense strengthening

Defense standards of protection are expressed as return periods. The study looks at the impact of increasing the return period of standard of protection for fluvial flood defenses by 50% and 100%, meaning protection to a 100-year return period level of severity becomes 150 years and 200 years.
 

The results

Overall, climate change erodes standards of protection (SoP) over the study period and produces significant increases in loss for our chosen scenario for both York and Pontypridd.

Although York has a large number of households at risk, the city benefits from high standards of flood protection. Our chosen 1-in-50-year flood scenario is largely contained by the defenses in the baseline. However, over the study period, climate change erodes the effectiveness of this protection and produces £11 million-£20 million ($14.1 million-$25.7 million) of additional losses for our scenario.

The outcome for Pontypridd is less sensitive to climate change than York. However, additional losses over the study period are not far behind the York outcomes despite the substantially lower number of households at risk. This is due to lower standards of flood protection. At the chosen 1-in-50-year flood scenario level, a portion of the losses already originate from overtopping of some of the existing river defenses before climate change is considered. There are additional climate change-driven losses of £8 million-£17 million ($10.3 million-$21.9 million) for Pontypridd for this scenario.

The strengthening of flood defenses offsets these additional losses; however, the two different defense-strengthening scenarios show that the effectiveness of investment varies. A 50% increase in SoP leads to the largest loss reduction for both York and Pontypridd, independent of the RCP scenario. Although a 100% increase in SoP still leads to a further reduction in loss, the reduction is not as great because even the largest embankments along the main rivers offer no protection against surface water flooding from excess rainfall.

For example, for Pontypridd in the 2040 RCP 2.6 scenario, a 50% SoP increase compared with existing defenses yields a reduction of £14 million ($18.0 million) in losses, while a 100% SoP increase only yields a further £5.5 million ($7.0 million) in loss reduction benefits. This behavior is similar (Pontypridd: RCP 8.5) or even more pronounced (York: RCP 2.6 and RCP 8.5) for the other scenarios shown. It is important to note that the higher SoP for York means that the city benefits more in the defense-strengthening scenarios than Pontypridd, where the starting point is lower. See Figure 1 for more details.

Conclusions

The importance and limitations of flood defenses

The United Kingdom is one of the best defended countries in the world for flood risk, and the government has committed more than £5 billion ($5 million) to the 2021–27 flood and coastal erosion risk management investment program. However, climate change presents an enormous challenge to defense infrastructure. This study projects that both York and Pontypridd will suffer material additional flood losses as a result of climate change as defenses are overwhelmed by increased flood severity over the lifetime of the Flood Re scheme.

Investment in flood defenses to increase standards of protection is one option to mitigate the impacts of climate change. This study shows that additional losses can be offset by defense-strengthening; however, significant increases in standards of protection are required to fully offset the additional costs. The study further indicates that investment in defense-strengthening is only cost-effective to a certain level, with eventual diminishing benefits.

In 2040, the United Kingdom will be dealing with these projected increases in risk as well as the transition of the UK domestic insurance market at the end of the Flood Re scheme. This study shows that investment in flood defenses will have an important role to play in the United Kingdom’s successful transition to a post-Flood Re insurance market for flood coverage. However, defense infrastructure is just one solution among multiple adaptations that will be required. For further reducing and better managing risk, additional measures such as property-level flood resilience and management of increased surface water risk will be necessary.