1、MILLIMAN WHITE PAPER Temperature-related impacts on solar assets 1 October 2024 Temperature-related impacts on solar assets Valea Coyne Charles Bason Emmanuel Boamah Wisdom Aselisewine Abstract 2023 was the warmest year on record over more than 100,000 years globally(European Environmental Agency,20

2、24).The impact of climate change on asset performance,particularly for alternative energy assets and those based on renewable energy,is increasingly significant.Climate change introduces variability in weather patterns,temperatures,and precipitation,which directly affects the efficiency and output o

3、f renewable energy sources such as solar,wind,and hydroelectric power.For instance,solar farms may experience fluctuations in energy production due to changes in solar irradiance and increased incidences of extreme weather events.Similarly,wind farms could be impacted by alterations in wind patterns

4、 and speeds.Climate indices,which quantify various aspects of climate variability,play a crucial role in forecasting and assessing these impacts.By integrating climate indices into financial and operational models,investors and operators can better understand,anticipate,and manage the risks associat

5、ed with climate change.This proactive approach enables more accurate predictions of asset performance,ensuring that renewable energy investments remain viable and sustainable in the face of a changing climate.The increasing urgency of climate change introduces two principal considerations relevant t

6、o this study.First,climate change compels rational investors to reassess vulnerable assets in light of potential financial materiality.Second,climate-related impacts are expected to intensify over time,as global temperatures are projected to rise at an increasing rate in a worst-case scenario,accord