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Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The Earth Institute, Columbia University 31 st Climate Diagnostics and Prediction Workshop 23-27 October 2006 Boulder, CO

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Page 1: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Developing Improved Climate Products for Effective Climate Risk Management

C. F. Ropelewski International Research Institute for Climate and Society

The Earth Institute, Columbia University

31st Climate Diagnostics and Prediction Workshop23-27 October 2006Boulder, CO

Page 2: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Development of new climate productsfor Effective Climate Risk Management

“Involve the Users from the start”

Considerations:

Be aware of the other factors effecting the system.

Understand the limiting factors (Internal and External)

Encourage flexibility in decision making and understandhow much flexibility resides in the system.

Be aware that there may be alternatives to those offered inthe use of climate information.

Page 3: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Institutions and Policies Research

• Methodologies for mapping institutions and policy process

•Methodologies to analyze policy responses and development outcomes

• Methodologies to analyze institutional utilityof climate information

Page 4: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Epidemic Preparedness and Response (EPR)

An example of how climate information can influence decisions in a real-world setting.

Example 1 - Health

Page 5: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The
Page 6: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

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Why EPR Planning: Outbreak Detection and Response Without Preparedness

Delayed Response

DAY

CASESOpportunity for control

Late Detection

First Cases

Page 7: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

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Why EPR Planning: Outbreak Detection and Response Without Preparedness

Rapid Response

DAY

CASES

Early Detection

Potential Cases Prevented

Page 8: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Case Study: Public Health, Botswana

Dec-Feb RAINFALL and Jan-May MALARIA incidence

5115N =

Detrended Malaria Anomoly Quartiles

Upper quartileMid quartilesLower quartile

Rain

fall

from

CM

AP

for

DJF

5.5

5.0

4.5

4.0

3.5

3.0

2.5

2.0

1.5

1993

2000

(Thomson et al, 2006; Nature)

Page 9: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Environmental monitoring

ENV monitoring enables opportunities to mobilize more localized response >>

Example in Botswana …

Page 10: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Seasonal Forecasting…..

SCF offers opportunities for planning and preparedness …….

NMCP strengthen vector control measures and prepare emergency containers with mobile treatment centers

Page 11: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Example 2 – Agriculture

Using climate information to inform decisions inagriculture.

Page 12: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Maize Yield (kg/ha)

0 2500 5000 7500 10000 12500

Cu

mu

lati

ve F

req

uen

cy (

%)

0

10

20

30

40

50

60

70

80

90

100La Niña (15 Sep)El Niño (15 Sep)

Adjusting crop management practices to ENSO phases

Maize Yield (kg/ha)

0 2500 5000 7500 10000 12500

Cu

mu

lati

ve F

req

uen

cy (

%)

0

10

20

30

40

50

60

70

80

90

100

La Niña (15 Dec)El Niño (15 Sep)

Case Study: Agricultural production, SE S.America

Maize: Changing sowing date and hybrid typeLa Niña years: shorter season hybrid, late sowing date

Page 13: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Márgenes Brutos (US $/ha) para Riego de Maíz en Secano(Ciclo Corto, Siembra de Setiembre, 1968 - 1999)

Modelo CERES-Maize

1965 1970 1975 1980 1985 1990 1995 2000

rgen

Bru

to (

US

$ /

ha)

-400

-200

0

200

400

600

800

CV = 128%9 years in 30: results ( 0)60% of Total Income in 6 years

Gross Margins for Rainfed Maize (1960 – 2001) CERES Model

Page 14: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Márgenes Brutos (US $/ha) para Riego de Maíz Regado y en Secano(Ciclo Corto, Siembra de Setiembre, 1968 - 1999)

Modelo CERES-Maize

1965 1970 1975 1980 1985 1990 1995 2000

rgen

Bru

to (

US

$ /

ha)

-400

-200

0

200

400

600

800

IrrigadoSecano

Gross Margins for Rainfed vs Irrigated Maize (1960 – 2001) CERES Model

Irrigated

Rainfed

Page 15: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Example 3 – Reservoir Management

Using climate information to inform decisions inWater Resources.

Page 16: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Case Study: Angat Reservoir, PhilippinesAssume that the current priority in water allocation is honored: 1st Manila water supply; 2nd Irrigation;

3rd Hydropower

Oct-Feb performance of the reservoir

Page 17: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Index insurance

• Insurance is a key tool to allow use of information in decisionmaking

• Problems with traditional crop insurance– Moral hazard– Adverse selection

• The index innovation– Insure weather index (such as seasonal rainfall), not

crop– Only partial protection (basis risk), should not overuse– Cheap, easy to implement, good incentives

• Minimum possible price (easy to determine): – aver insurance payout + admin + risk finance costs– This price must < value to client for market to exist

Page 18: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

• In Malawi, smallholder farmers report they cannot currently obtain inputs necessary to address climate variability

• New contracts provide for a package of loans, groundnut and maize inputs

• Working toward packages including price incentives, risk protection to take advantage of forecasts

–Partners include Malawi farmers and financing associations (NASFAM, OIBM MRFC, Malawi Insurance Association), the World Bank CRMG, Malawi Met Service, CUCRED

Case Study: Index Insurance, Southern Africa

Page 19: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Summary of current activities in Africa

• Ethiopia– Drought famine relief (client: national government, pilot

2006)– Crop loss micro-insurance (client: farmers, pilot 2006)

• Morocco– Crop loss micro-insurance, climate change problems

• South Africa: Relatively developed financial markets– Apple grower cooperatives and freeze coverage

• Malawi– Drought relief (client: national government, pilot 2006)– Farm level crop loss, bundled contracts (~900 farmers,

transacted 2005)• Scoping: Tanzania, Uganda, Kenya, more on the way• India: BASIX, thousands of farmer transactions completed

World Bank CRMG, Re-insurers, WFP highly involved

Page 20: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

SUMMARY

Climate Risk Management provides:

More resilient systems for management of seasonal climate variability. andA mechanism for building management systems to cope with climate variability on longer time scales

Tailoring climate information to risk management problems is key methodological issue

Early and effective engagement with stakeholders is essential

For most effective and timely implementation, institutional mapping is key

Page 21: Developing Improved Climate Products for Effective Climate Risk Management C. F. Ropelewski International Research Institute for Climate and Society The

Summary (continued)

Be aware of the other factors effecting the system.

Understand the limiting factors (Internal and External)

Encourage flexibility in decision making and understandhow much flexibility resides in the system.

Be aware that there may be alternatives to those offered inthe use of climate information.

“Involve the Users from the start”