Airport and port to disclose climate risk as shareholders group urge ... - Stuff

Airport and port to disclose climate risk as shareholders group urge more companies to follow suit | Stuff.co.nz

Airport and port to disclose climate risk as shareholders group urge more companies to follow suit

Nelson Airport and Port Nelson will disclose the impacts of climate change on their businesses, and vice versa, even though they aren’t required to by law.

Shareholders said more businesses should have to disclose the information, to help prevent developments and practices where risks like flooding and environmental damage were too high.

The airport and port – both in low-lying coastal areas – were not among the approximately 200 entities in New Zealand obliged to disclose their climate-related risks, under legislation that came into force this year.

But the company controlling the two operations, Infrastructure Holdings Ltd (IHL), last week said it would would disclose their risks against the standards of the climate-related disclosure (CRD) scheme

IHL owners, Nelson City Council and Tasman District Council, requested last year that the company work towards CRD reporting.

A statement of intent released on Tuesday from IHL said the company would start working against the standards in 2024, and fully comply with them by 2026.

Nelson city councillor Rachel Sanson was impressed with the “detailed structure” of the port and airport’s plans to reduce carbon emissions and respond to risks to the assets, like flooding and inundation.

Sanson put forward the recommendation the entities disclose the information, over concerns infrastructure developments in vulnerable areas could lose insurance and ongoing funding.

Sanson hoped the entities’ disclosure would help protect against either of them being “able to proceed with really climate risky investment”.

The airport was currently seeking changes that would allow for an extension of its runway, recently shown to be at higher risk of sea level rise than previously thought, including the ability to extend the airport's main existing runway to the north within the next 10 – 15 years.

Chief executive Mark Thompson didn’t think that risk would threaten an extension.

“Our view and advice is, we can mitigate that by clearly building that land up as we develop it.”

The runway flooded in 2018 when ex-cyclone Fehi hit, and a corner flooded for a short time during last year’s extreme rain event, in August, he said.

A project was underway to upgrade and replace the airport’s stormwater network so that it could handle heavy rainfall and “the inundations that we expect”.

“Our challenge is, where it [stormwater] all currently goes is into a tidal creek, so when it’s high tide it’s got nowhere to go.”

Detention ponds were needed which could hold the stormwater at high tide and release it at low tide, Thompson said.

A current resilience plan for the next 30 years was identifying other mitigation strategies, including pump stations, stop banks and rock walls.

Port Nelson chief executive Hugh Morrison said the main physical impact of climate change on the port was water washing across its container terminal more frequently.

Other impacts on the business included the prospect of higher volumes of cargo like apples, which might grow better in the changing climate, but lower volumes of other produce that didn’t.

An “Infrastructure Masterplan” was being finalised, outlining how the port could protect against the risks over the next 30 years.

Some of the port’s wharves needed rebuilding, which could include creating a dam around the edges, Morrison said.

The port was also looking at raising levels of the container terminal.

New Zealand King Salmon (NZKS) and NBS were the only two entities in the region required to report under the CRD regime, which included large financial organisations and publicly-listed companies (those with shares listed on the NZ stock exchange).

NZKS met the threshold, being publicly-listed with equity securities with a market price above $60m.

The airport’s assets were worth more than that, the port’s several times more, but they were not publicly-listed.

The New Zealand Shareholders Association CEO Oliver Mander said all companies with a significant asset base should be required to disclose their climate risk, not just “a relatively small number of companies” listed on the stock exchange.

Shareholders were concerned about the environmental impacts of their investments, as well as whether the physical effects of climate change would devalue their investments, he said.

So they needed the information “in front of them” when making investment decisions.

MBIE said there were currently no plans to expand the mandatory CRD regime.

Four publicly listed ports and three international airports (in Auckland, Wellington and Christchurch) were in the regime.

Regulator the Financial Markets Authority didn’t monitor voluntary reporting, with “numerous climate frameworks that organisations could voluntarily disclose against”.