‘Smart contracts’ could mitigate onsite weather risk
A new form of digital smart contract could save firms time and money when measuring the impact of adverse weather on projects and placing compensation claims.
The system, dubbed the Weather Ledger solution and developed by UK-based startup EHAB, collects weather data in real-time and triggers various notifications for extremes that may cause delays onsite.
So far, the system has been trialled by BAM Nuttall and Ferrovial Construction across four sites. Five compensation claims were triggered. Data suggests 17% more rain is falling on rainy days and flood risk has increased 20-90% across the UK, according to EHAB.
A spokesman for EHAB said in Construction Enquirer: “This “pay as you go” weather risk distribution could save the client money upfront and help contractors offer a more competitive price, while still providing clear cost parameters.
“We are also in talks with major insurers who could seek to underwrite the downsides of weather delay through a Parametric Insurance add-on to the smart contract.
“This could see the total weather risk of a project, or portfolio, capped. This may be an increasingly attractive proposition as more of the downsides of the climate crisis are realised by the industry.”