Scotland may require up to £14.2bn in climate adaptation investment by 2040, study finds

Scotland could require between £7.8 bn and £14.2 bn of investment over the next 15 years to adapt to the impacts of climate change, according to new research that highlights the scale of funding needed to improve the resilience of infrastructure, communities and the natural environment.

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The study, led by the University of Strathclyde and published by ClimateXChange, Scotland's centre of expertise on climate change, provides what the authors describe as the first comprehensive estimate of adaptation investment needs across five sectors: transport, agriculture, communities and flood resilience, the natural environment, and water. The research was supported by consultancy Paul Watkiss Associates and is intended to inform future policy and investment decisions through to 2040.

The report estimates annual investment requirements of between £566m and just over £1bn across the sectors assessed. However, the researchers note that the analysis covers only part of Scotland's adaptation needs and that total investment requirements are likely to be higher once additional sectors and climate risks are taken into account.

Among the sectors examined, the report concludes that additional investment will be needed to maintain current levels of resilience in transport, flood protection and nature restoration. It found that existing funding in agriculture is broadly aligned with estimated adaptation needs, while insufficient information was available to assess current levels of adaptation investment in the water sector.

The transport assessment focuses on adapting Scotland's trunk roads, motorways and railways to increasingly frequent and severe weather events. The researchers note that higher temperatures, heavier rainfall and more frequent flooding are expected to increase pressure on transport infrastructure, leading to greater maintenance requirements and a higher risk of disruption if adaptation measures are delayed.

Alongside estimating investment requirements, the study examined the wider economic effects of adaptation spending. It found that investing in climate resilience could generate broader economic benefits through increased employment, supply chain activity and reduced damage from future climate impacts.

The report also considers the respective roles of public and private finance, concluding that while many adaptation measures will continue to rely on public funding, there may be opportunities to attract greater private sector investment in areas where commercial returns can be demonstrated.

The publication comes as governments across the UK place increasing emphasis on climate adaptation alongside emissions reduction. Recent UK Government initiatives have included additional funding to strengthen the evidence base for climate adaptation and improve long-term resilience planning.

The authors describe the investment estimates as evidence-based approximations rather than definitive funding targets, reflecting the uncertainties associated with projecting future climate impacts and adaptation costs. They argue that early investment in resilience can help reduce the long-term economic and social costs associated with flooding, extreme weather and other climate-related risks, while providing a stronger evidence base for future infrastructure and public spending decisions.