ECONOMICANALYSISOFPOWERPROJECTS:INTEGRATIONOFCLIMATECHANGEANDDISASTERRESILIENCETECHNICALREPORT020/22PublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorized©2022June|InternationalBankforReconstructionandDevelopment/TheWorldBank1818HStreetNW,Washington,DC20433Telephone:202-473-1000;Internet:www.worldbank.orgSomerightsreserved.RightsandPermissionsThematerialinthisworkissubjecttocopyright.BecausetheWorldBankencouragesdisseminationofitsknowledge,thisworkmaybereproduced,inwholeorinpart,fornoncommercialpurposesiffullattributiontothisworkisgiven.Anyqueriesonrightsandlicenses,includingsubsidiaryrights,shouldbeaddressedtoWorldBankPublications,WorldBankGroup,1818HStreetNW,Washington,DC20433,USA;fax:+1-202-522-2625;e-mail:pubrights@worldbank.org.Furthermore,theESMAPProgramManagerwouldappreciatereceivingacopyofthepublicationthatusesthispublicationforitssourcesentincareoftheaddressabove,ortoesmap@worldbank.org.ThisworkisavailableundertheCreativeCommonsAttribution3.0IGOlicense(CCBY3.0IGO)http://creativecommons.org/licenses/by/3.0/igo.UndertheCreativeCommonsAttributionlicense,youarefreetocopy,distribute,transmit,andadaptthiswork,includingforcommercialpurposes,underthefollowingconditions:Attribution—EnergySectorManagementAssistanceProgram.2022.EconomicAnalysisofPowerProjects:IntegrationofClimateChangeandDisasterResilience.TechnicalReport020/22.Washington,DC:WorldBank.License:CreativeCommonsAttributionCCBY3.0IGOTranslations—Addthefollowingdisclaimeralongwiththeattribution:ThistranslationwasnotcreatedbyTheWorldBankandshouldnotbeconsideredanofficialWorldBanktranslation.TheWorldBankshallnotbeliableforanycontentorerrorinthistranslation.Adaptations—Addthefollowingdisclaimeralongwiththeattribution:ThisisanadaptationofanoriginalworkbyTheWorldBank.Viewsandopinionsexpressedintheadaptationarethesoleresponsibilityoftheauthor(s)oftheadaptationandarenotendorsedbyTheWorldBank.Third-PartyContent—TheWorldBankdoesnotnecessarilyowneachcomponentofthecontentcontainedwithintheworkanddoesnotwarrantthattheuseofanythird-partyownedindividualcomponentorpartcontainedintheworkwillnotinfringeontherightsofthosethirdparties.Ifyouwishtoreuseacomponentofthework,itisyourresponsibilitytodeterminewhetherpermissionisneededforthatreuseandtoobtainpermissionfromthecopyrightowner.Examplesofcomponentscaninclude,butarenotlimitedto,tables,figures,orimages.ProductionCreditsProductionEditor|HeatherAustin,TheWorldBankDesigner|CircleGraphics,Inc.Images|Cover:JulienMulliez/DFIDAllimagesremainthesolepropertyoftheirsourceandmaynotbeusedforanypurposewithoutwrittenpermissionfromthesource.iCONTENTSvABBREVIATIONSviiACKNOWLEDGEMENTSviiiKEYMESSAGES11.INTRODUCTION21.1TheTreatmentofRiskandUncertaintyinWorldBankGuidelines21.2TheCounterfactual31.3Alternatives31.4TheStandardSummaryPresentation51.5Scope72.BASICCONCEPTSANDDEFINITIONS72.1Resilience72.2Robustness82.3StressTests82.4RiskRegistersandHazardQuantification102.5RiskandUncertainty112.6AdaptationCosts133.THEIMPACTSOFCLIMATECHANGE133.1ClimateChangeandDisasterResilience143.2DirectandIndirectImpacts153.3ChronicandAcuteImpacts174.METHODOLOGY174.1RiskasanAttribute194.2TheTrade-OffBetweenRiskandReturn214.3AFrameworkforDecision-Making234.4MitigationandAllocationofRisks244.5QuantitativeRiskAssessment:CurrentPractice295.PROCEDURE295.1BaselineReturns3...
