Field of Action Industry and Commerce

Pipelines on a factory siteClick to enlarge
Even industrial production is affected by climate change.
Source: Thorsten Schier/

Impacts of Climate Change

Table of Contents


Impairment of the supply of raw materials and intermediate products

The German economy depends on a reliable supply of raw materials and intermediate products for further processing. The future supply can be impaired in particular by the effects of climatic influences in the countries of extraction and cultivation. This applies above all to Brazil, Vietnam, India, South Africa and Thailand, which are particularly affected by climate change and have high exports to Germany. Particularly affected raw materials are cocoa, coffee, tea, mate, rubber and cotton. But ores, slag and ash and animal and vegetable fats and oils are also affected, with high import volumes at the same time.

For companies in Germany, this can mean rising costs and economic risks. About six percent of German imports in 2015 came from countries classified as particularly climate-vulnerable. This can lead to import risks for German companies, especially for raw materials that are found exclusively in these countries.


Conditions on sales markets

Germany is one of the world's largest exporters of goods and services. The most important exported product groups include motor vehicles and motor vehicle parts, machinery, chemical products and data processing equipment as well as electrical and optical products.

This results in Germany's increased vulnerability to climate impacts in other regions of the world. Germany's main trading partners are countries of the European Union. However, there are also important trade relations with countries that are strongly affected by the consequences of climate change. This can lead to changes in demand and shifts in future sales markets.

In addition, opportunities also arise from the development of new sales markets, especially in the construction and chemical industries. Especially in the area of climate protection and adaptation technologies, an increase in demand for products and advisory services can be expected.


Competitive advantage in innovative environmental technologies

The German market for environmental technologies represents a significant growth market. Promising environmental technologies include e-mobility, lithium-ion batteries, industrial waste heat utilisation and the recycling of photovoltaic systems. Innovative adaptation technologies include rainwater harvesting technologies, novel weather forecasting and warning systems and efficient irrigation systems. The market for innovative environmental technologies is expected to grow strongly until 2025.


Impairment of the transport of goods

Climatic influences and extreme weather events such as heavy precipitation, high winds, storm surges and periods of heat affect the transport infrastructure and can lead to negative impacts for the international and domestic transport of goods. Even short-term capacity bottlenecks along the entire supply chain can have a negative impact on logistics and trade. International maritime transport is particularly affected by the consequences of climate change.

Low water events are also of great importance for domestic goods traffic via federal waterways. Extreme low water levels can lead to a reduction in transport volumes, delays in deliveries or transshipments to other modes of transport.

On coastal waterways and sea waters, storms can cause extreme high water levels that affect shipping and sometimes lead to loss of cargo in heavy seas.

Due to an increase in heavy precipitation and hot days, disruptions to delivery processes on roads and railways can also be expected in the future, but these are usually short-lived. 


Other climate impacts

Energy consumption and impairment in energy supply: The energy supply of German companies can also be considered largely stable in the future. Uncertainties arise from the planned grid expansion in the context of the energy transition, which may lead to an increased susceptibility of the grid to disruptions.  For energy-intensive industries in particular, increasing fluctuations in the electricity price triggered by extreme weather events such as periods of heat and heavy precipitation may lead to higher energy costs in the future. These price increases can be a trigger for energy savings. An increase in cooling energy demand due to the rise in temperature can increase the energy consumption of companies.

Water demand: Increasing heat may lead to greater seasonal variation and increased variability in water demand. Water demand in industry and commerce may decrease in the future due to widespread wastewater recycling and more efficient cooling systems. It can be assumed that the demand for cooling water for thermal power plants, which currently accounts for a significant share of water demand, will continue to decrease in the future as a result of the energy transition.

Release of hazardous substances: Chemical and wastewater treatment plants are affected by increased risks of the release of hazardous substances as a result of flooding. In built-up areas, untreated wastewater can escape from overloaded sewage systems due to heavy precipitation or run off superficially and enter bodies of water. Longer periods of heat can lead to higher heating of plant components. If thermally sensitive substances are present, they may start to react and cause substance releases, fires or explosions. Increased solar radiation, especially on hot days, can cause ground-level ozone to have greater harmful effects on health.

Reduced performance of employees: As a result of rising average air temperatures and more frequent heat waves, a higher number of days per year can be expected on which the mental and physical performance of employees working indoors may be reduced. The increase in extreme events may increase the loss of performance due to accidents or health hazards for outdoor workers. Outdoor workers are also potentially exposed to increasing UV and pollen loads. Air pollutants related to UV radiation, such as ground-level ozone, can also contribute to the increase in performance losses during outdoor work activities.

Indicator from the monitoring on the DAS: Heat-related loss in performance

Impairment of production processes: Damage to buildings and infrastructures, impairment of energy and water supply, loss of performance of employees and machinery as well as restrictions of national and international supply chains may increase in the future due to climate change and thus impair production processes. The expected digital transformation of industry and increasing automation are likely to lead to further fundamental changes in production processes.

Effort for operational planning: The effort for operational planning will increase as a result of climate change, especially due to extreme weather events that are difficult to predict.

Adaptation to Climate Change

Promotion of adaptation measures in companies

The state can promote climate adaptation in industry and commerce through various measures, such as information campaigns, advisory services, adaptation bonuses or targeted subsidies. Regulatory market changes, such as safety standards in the context of building regulations, also create a framework for action for adaptation.

Furthermore, motivation and acceptance are important factors for climate adaptation in companies. If it is clear that companies are affected, adaptation is often also in their economic interest. Risk analyses for specific economic sectors or supply chains can contribute to an increase in risk perception.

Adaptation options for companies

There is a wide range of possible adaptation measures for companies. Successful adaptation requires systematic, forward-looking risk management that includes measures to mitigate and control climate and weather risks. Climate checks and other holistic approaches based on corporate risk management systems can be used to analyse operational processes and take appropriate precautionary measures.

Companies can counter possible supply bottlenecks for raw materials and the resulting production delays by diversifying their locations, suppliers and raw materials more strongly. In addition, the storage of raw materials and flexible timing of production steps are effective adaptation measures. In this way, companies are also less vulnerable to disruptions or damage to transport infrastructure as a result of extreme weather events.

Indicator from the monitoring on the DAS: Intensity of water consumption in the manufacturing sector