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AT&T, hit by higher natural disaster costs, unveils 30-year climate change model

Key Points
  • AT&T is paying the U.S. Department of Energy's Argonne National Laboratory to predict climate-related events that could damage the company's infrastructure over the next 30 years. 
  • The announcement follows several natural disasters that cost the telecommunications company $847 million since 2016, including $626 million in 2017 alone. 
  • Other major US companies are also bracing for climate-related risks that could harm profits and strategy.
AT&T workers repair phone lines as a burned-out vehicle sits on a road during the Camp Fire in Paradise, California, Nov. 13, 2018.
David Paul Morris | Bloomberg | Getty Images

AT&T is paying the U.S. Department of Energy's Argonne National Laboratory to predict climate-related events that could damage the company's infrastructure over the next 30 years.

The announcement Wednesday follows several natural disasters that cost the telecommunications company $847 million since 2016, including $626 million in 2017 alone. AT&T, which has a market value of $229.9 billion, reported operating revenue of $160.55 billion in 2017.

The tool will track flooding, hurricane and wind storms in North and South Carolina, Georgia and Florida, according to Charlene Lake, AT&T's chief sustainability officer and senior vice president for public affairs. The company plans to extend climate projections across the country, and track wildfires and droughts as well.

"The project enables us to get information that can help anticipate the impact of climate change up to 30 years in advance, with high-resolution climate models at the hyperlocal level and new data we can ingest into our system to gain more intelligence about what happens to our infrastructure going forward," Lake said in an interview.

"Our customers and community depends on our service during natural disaster time and the resilience of our business and network," she said, adding that AT&T will share its climate data with municipalities and universities to use for analysis.

Other major U.S. companies are also bracing for climate-related risks that could harm profits and strategy, according to corporate disclosures collected by U.K. nonprofit CDP. The disclosures show that a majority of the largest U.S. companies say that climate change poses a serious threat to operations.

Scott Mair, AT&T's president of operations, said that the model will guide decisions on whether to elevate cell sites in areas with expected flooding, or to build protections around cell towers in areas with expected higher winds.

Rather than relying on 10-day weather forecasts and historic weather trends, the company will visualize local climate-related events that could damage copper lines, fiber cable locations, cell sites and other infrastructure.

"Historically, we've taken into consideration where flooding might impact us. But it's always been based on history," Mair said.

"It's not only about where flooding happens today, but more importantly, where it happens tomorrow. The infrastructure we put in today will last over 25 years. The more we know about what's to come, the better options we have today."