TY  - JOUR
A1  - Guzman Arias, Diego Alejandro
A1  - Samprogna Mohor, Guilherme
A1  - Mendiondo, Eduardo Mario
T1  - Multi-driver ensemble to evaluate the water utility business interruption cost induced by hydrological drought risk scenarios in Brazil
JF  - Urban water journal
N2  - Climate change and increasing water demand in urban environments necessitate planning water utility companies' finances. Traditionally, methods to estimate the direct water utility business interruption costs (WUBIC) caused by droughts have not been clearly established. We propose a multi-driver assessment method. We project the water yield using a hydrological model driven by regional climate models under radiative forcing scenarios. We project water demand under stationary and non-stationary conditions to estimate drought severity and duration, which are linked with pricing policies recently adopted by the Sao Paulo Water Utility Company. The results showed water insecurity. The non-stationary trend imposed larger differences in the drought resilience financial gap, suggesting that the uncertainties of WUBIC derived from demand and climate models are greater than those associated with radiative forcing scenarios. As populations increase, proactively controlling demand is recommended to avoid or minimize reactive policy changes during future drought events, repeating recent financial impacts.
KW  - Business interruption cost
KW  - water utility company
KW  - hydrological
KW  - droughts
KW  - water security
KW  - urban water
KW  - climate change
Y1  - 2022
U6  - https://doi.org/10.1080/1573062X.2022.2058564
SN  - 1573-062X
SN  - 1744-9006
PB  - Routledge, Taylor & Francis Group
CY  - Abingdon
ER  - 
TY  - JOUR
A1  - Guzman, Diego A.
A1  - Samprogna Mohor, Guilherme
A1  - Mendiondo, Eduardo Mario
T1  - Multi-year index-based insurance for adapting Water Utility Companies to hydrological drought
BT  - case study of a water supply system of the Sao Paulo metropolitan region, Brazil
JF  - Water
N2  - The sustainability of water utility companies is threatened by non-stationary drivers, such as climate and anthropogenic changes. To cope with potential economic losses, instruments such as insurance are useful for planning scenarios and mitigating impacts, but data limitations and risk uncertainties affect premium estimation and, consequently, business sustainability. This research estimated the possible economic impacts of business interruption to the Sao Paulo Water Utility Company derived from hydrological drought and how this could be mitigated with an insurance scheme. Multi-year insurance (MYI) was proposed through a set of "change" drivers: the climate driver, through forcing the water evaluation and planning system (WEAP) hydrological tool; the anthropogenic driver, through water demand projections; and the economic driver, associated with recent water price policies adopted by the utility company during water scarcity periods. In our study case, the evaluated indices showed that MYI contracts that cover only longer droughts, regardless of the magnitude, offer better financial performance than contracts that cover all events (in terms of drought duration). Moreover, through MYI contracts, we demonstrate solvency for the insurance fund in the long term and an annual average actuarially fair premium close to the total expected revenue reduction.
KW  - multi-year insurance
KW  - climate change
KW  - hydrological drought
KW  - water
KW  - security and economy
Y1  - 2020
U6  - https://doi.org/10.3390/w12112954
SN  - 2073-4441
VL  - 12
IS  - 11
PB  - MDPI
CY  - Basel
ER  -