The current climate crisis requires new approaches to manage utility infrastructure risk. Traditional methods no longer function effectively, and are woefully behind the realities of the situation. The combination of rising sea levels and record-breaking heat, increasingly intense storms and wildfires, and the once-in-a-lifetime weather events that are now seemingly happening every year, creates new operational requirements for designing and maintaining energy, water and communication infrastructure. 

Once relied on utility infrastructure risk management framework now fails to protect against increasing catastrophes. The rising global temperatures and intensified natural disasters and wildfires and rising sea levels and increasingly extreme heat create new conditions which require energy infrastructure, water systems, and communication networks to operate and maintain. The integration of climate risk into fundamental infrastructure planning and project execution processes has become a key priority for both utilities and their regulators.

The environmental issue of climate change was once treated as a distant concern, but now organizations recognize it as an immediate operational and financial threat. 

PG&E assessed their wildfire risk, saw that overhead power lines were a liability, and implemented underground power line programs, not only to mitigate risk, but also to enhance power system reliability. The program aims to decrease catastrophic wildfire risks through underground distribution power line relocation in High Fire-Threat Districts (HFTDs), particularly in Tier 2 and Tier 3 zones across California.

The program targets the underground installation of 10,000 miles of overhead distribution lines throughout multiple years, making the targeted infrastructure virtually wildfire-proof when properly buried, since it eliminates 99% of potential ignition risks.

Large-scale utility infrastructure projects need new risk management strategies to handle the consequences of climate change. Risk identification has experienced a fundamental shift because climate now stands as a leading factor for identifying potential problems. And while the specific problem may not be foreseeable, it’s universally accepted that there will be unavoidable issues. 

Utility operations benefit from this knowledge by forcing management teams to make crucial decisions about building locations, material selection, and necessary system protection methods. 

Sabal Trail Transmission, a 500+ mile natural gas pipeline crossing Alabama, Georgia, and Florida, uses a comprehensive risk management plan to ensure safety, environmental protection, and regulatory compliance. To ensure pipeline integrity, Sabal uses inline inspections (smart pigs), corrosion protection, and high-strength pipe coatings. They applied geological studies and used engineered backfill to stabilize ground in sinkhole-prone areas, protected wetlands and aquifers via trenchless drilling, and utilized 24/7 monitoring, automatic shutoff valves, and coordination with first responders to ensure emergency preparedness.

In California, the aforementioned PG&E operates manages wildfire risk by relying on weather stations, together with AI-based vegetation management and automated public safety power shutoffs for high-risk areas throughout the state.

RMI and the Department of Energy's Climate READi initiative lead the way by offering guidelines which enable utilities to locate physical and transition risks, while performing financial and operational assessments and developing funding and protection plans for their projects and resources. 

The effectiveness of planning depends entirely on the accuracy of its underlying data. Utilities employ scenario modeling together with stress testing to gain detailed insights about system behavior under climate-related pressure. The EPA's CREAT platform and probabilistic modeling methods enable utilities to examine compound risks such as heat and wind exposure for their vulnerability assessment. 

Understanding risk is only half the battle because utilities must also construct their operations to withstand anticipated challenges. 

Wildfire and vegetation risk in particular are drawing sharper focus. In Texas, new legislation now mandates utility pole inspections and fire-mitigation planning across energy corridors On the West Coast, utilities deploy high-resolution weather monitoring, vegetation trimming, and preemptive public safety power shutoffs (PSPS) to prevent ignition events.

On the financial front, climate-savvy utilities are turning to insurance innovation and updated rate models.The financial industry has developed new tools to facilitate climate risk transfer. According to McKinsey, insurers have started working with utilities to provide funding for climate-resilient infrastructure investments which drive adoption of proactive adaptation measures  In Lake Tahoe, for instance, a pilot parametric insurance program run by The Nature Conservancy rewards landowners who protect forest health, lowering the risk and cost of wildfire damages 

All of this rests on strong coordination. Utility resilience today requires more than engineering—regulators, municipalities, emergency services, and community stakeholders all play a role. That’s why states like California now require climate vulnerability assessments as part of mandatory filings, and why the DOE’s Partnership for Energy Sector Climate Resilience stresses cross-sector collaboration.

Red Flag Warning (RFW) are issued by the National Weather Services for weather conditions that are favorable for explosive wildfire growth. Fire and severe weather monitoring systems and Fire Weather Threat (FWT), alongside solar powered weather stations, have all been integrated to get ahead of issues before they happen, and provide up-to-the-minute data to arm response teams as they must react to ever-changing weather. 

The last piece of the puzzle is flexibility. Because climate risks evolve, utilities must continuously monitor and adapt. That includes deploying sensor networks, using AI to forecast vegetation risk, and analyzing asset performance in real time. These tools support adaptive management—helping utilities learn from each event and iterate forward.

In the end, the utilities that thrive in this climate-driven future will be the ones who treat resilience not as a retrofit, but as a core competency. That means planning with precision, designing with foresight, financing with creativity, and governing with collaboration. The stakes are rising—literally and figuratively—and the path forward is built on smarter risk.

Parthiv Varma is a project control specialist with 14+ years of experience managing budgets for multi-billion-dollar energy infrastructure projects, including the Mountain Valley Pipeline and Sabal Trail Gas Transmission initiatives.