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Historically an important transportation corridor in the Northwest Territories, climate change has shortened the duration of the Mackenzie River's navigational season. Communities rely increasingly on airlift as the growing volatility affects barging operations, leading to higher overall freight costs. Using an options approach, we present a methodological framework that supports flexible infrastructure decision making, accounting for the impacts of climate change uncertainty. We apply this method to the decision of whether to continue barging on the Mackenzie River, or connect the entire corridor by extending the all-weather Mackenzie Valley Highway, explicitly considering uncertainties in river barging conditions. We first model river open season days as a stochastic process; barging is dependent on the number of open season days, which in turn is affected by climate change. Second, we evaluate the expected cost of barging and airlift each season using a modified Black-Scholes model. Finally, we use real options to determine how long construction of the all-weather highway may be deferred. The results indicate that it is advisable to defer construction nearly a decade, in balancing the costs of construction against climate change uncertainty. This paper demonstrates that when we explicitly incorporate the impact of climate change on project valuations, particularly those in northern and Arctic Canada where these impacts are considerable, project valuations can change significantly such that all-weather road construction is supported, even if it is deferred to future years. This method can assist federal and territorial governments in communicating the impacts of climate change on communities, and provide another tool to support multi-layered, complex transportation infrastructure investment decisions that address these rapidly changing environments. [ABSTRACT FROM AUTHOR]

Summary: Concern has been expressed regarding the impacts of climate change on freshwater aquatic ecosystems in arctic regions. Populated with lakes controlled by flooding from spring break-up ice jams, arctic deltas such as the Mackenzie Delta in northern Canada are particularly sensitive to changing ice break-up conditions and the hydroclimatic controls on break-up and ice-jam flooding. An understanding of these controls is necessary for assessing future climate change effects. This paper presents an assessment of hydroclimatic conditions controlling break-up over the period 1974–2006, with a focus on extreme flood events. Both the upstream driving force, capturing elements of the spring discharge hydrograph, and the downstream resistance force, describing the competence of the downstream ice cover, were quantified with reference to the Mackenzie River at Arctic Red River hydrometric station such that the contribution of each to the severity and timing of break-up could be explored. Results show that the severity of peak break-up stage is most influenced by upstream discharge and the balance between upstream and downstream melt, while timing is related to delta ice conditions and the rise of the spring hydrograph. The highest peak stage events require a rapid rise in discharge and high peak discharge. Minimal downstream melting degree-days and greater ice thickness are also important, although no relationship of these appears to control the level of backwater produced from broken ice and ice jamming effects. The pattern of rapid (protracted) upstream melt and lower (higher) intensity melt in the delta characterizes the highest (lowest) break-up events. For the most severe events, upstream forces are important in controlling discharge-driven events, while an altered hydrologic response occurring for ice-driven events was noted, meriting future examination. Finally, trends toward a longer prebreak-up melt interval, lower peak discharge, rate of rise in discharge, and ice thickness, and higher freeze-up stage were observed, with greater variability of these controls and break-up severity in the most recent decade. [Copyright &y& Elsevier]