The telecommunications sector
The telecommunications sector provides the ability to communicate or access information, and therefore facilitates the functioning and connectivity of the United States economy. It is the basic infrastructure governments, companies, and citizens depend on, and therefore disruptions in this sector ripples throughout the entire economy.
Climate change and variability threaten the infrastructural integrity and productivity of this critical sector both directly and indirectly. Changes in temperature norms directly impacts the physical assets of telecommunications companies which were designed to function within specific climate and environmental conditions, potentially increasing the frequency and severity of disruptions. Increased likelihood of more extreme weather adds pressure to match those probabilities with more resources for better prevention and contingency plans which can be costly. On top of that, global regulations of reducing greenhouse gas emissions forces these companies to reassess the true costs and externalities of energy sources, and to manage the company’s carbon footprint overall.
Verizon Communications Inc.
Verizon is a leading telecommunications company in the US, providing voice, data and video services through wireless and wireline networks to deliver customers’ demand for mobility, reliable network connectivity, security and control 1. Verizon’s $220B of physical assets (80% of which is network equipment which consists primarily of cable in aerial, buried, underground or undersea)2 is exposed to climate change which can directly impact Verizon’s core capability of delivering connectivity 3:
These events could also damage the infrastructure of the suppliers that provide Verizon with the equipment and services needed to operate. While Verizon have preventative measures against these changes (pressurized cables to keep water out for example 4) extreme events such as Hurricane Sandy that struck the Northeast in October 2012 showed Verizon first-hand that their infrastructure and operations were not able to cope with extreme weather. Flooding and storm surges caused power failures, and inadequate backup generators rendered many sites inoperable. The storm also caused significant physical damage, knocking out 25% of all cell towers in an area spread over the coasts of 10 states.
In addition to these direct impacts, Verizon must comply with the global efforts of reducing carbon emissions, pressuring the company to monitor carbon efficiencies and long term sustainability. Verizon’s carbon efficiency metric, unveiled in 2011, divides the company’s carbon emissions in metric tons by the amount of data it transports (in terabytes). The carbon emissions used in the metric include electricity, building fuels, and vehicle fuels, and Verizon plans to cut emissions by 50% of 2009 levels by 20205.
Verizon is taking opportunities like Sandy to modernize sections of its network to technology more resilient to climate changes, and increasing reliability in general. Below are some of the steps Verizon has taken for reliability particularly in times of emergency when they are needed most 6:
- Processing centers in some states designed to withstand Category 5 hurricanes
- Hardened shells
- Large-scale on-site power generation
- Fleets of mobile communications units
- Cells on Wheels (COWs)
- Cells on Light Trucks (COLTs)
- Cellular Repeaters on Wheels (CROWs)
- Generators on a Trailer (GOATs)
- Back-up generators built directly into cell sites
- Maintain coverage even in events of prolonged power outage
- Dedicated, trained employees for crisis management
- Works in close conjunction with police, fire, and other public safety agencies
To address long term sustainability, Verizon reducing the carbon dioxide equivalent per terabyte to 48% of 2009 levels 7 and is investing in green energy investments, building improvements, and fleet operations to reduce carbon footprint 8.
Food for thought
Climate change and variability adds an expensive dimension of uncertainty that burdens Verizon with massive additional direct and indirect costs. While an argument could be made that Verizon has a corporate and social responsibility to provide communication services to customers at times of need, who should bear those additional costs? Verizon could continue investing in the resilience of their assets and managing their carbon footprint, but the consumers, the government, and the telecommunications sector will need to balance how to pick up the bill.
 Verizon Communications Inc. Form 10-K, p1, US Securities and Exchange Commission, February 2016
 Verizon Communications Inc. Form 10-K, p20, US Securities and Exchange Commission, February 2016
 Peter Adams and Jennifer Steeves, “Climate Risks Study for Telecommunications and Data Center Services”, Riverside Technology and Acclimatise, 2014
 Grand Brunner, “Hurricane Sandy damaged Verizon’s network but clever technology saved the day”, ExtremeTech, November 2012, https://www.extremetech.com/extreme/141128-hurricane-sandy-damaged-verizons-network-but-clever-technology-saved-the-day accessed November 2016
 Leon Walker, “Verizon Aims to Cut Carbon Intensity by Half by 2020”, Environmental Leader, March 2012, http://www.environmentalleader.com/2012/03/20/verizon-aims-to-cut-carbon-intensity-by-half-by-2020/, accessed November 2016
 Verizon Website, “Prepared to weather the storm”, http://www.verizon.com/about/emergency-information/prepared-weather-storm, accessed November 2016
 Verizon Website, “Emissions Profile”, http://www.verizon.com/about/responsibility/emissions-profile, accessed November 2016
 Verizon Website, “Sustainability”, http://www.verizon.com/about/responsibility/sustainability, accessed November 2016