When the Sun Strikes: Preparing for the Business Impact of Geomagnetic Storms
Snapshot:
- Geomagnetic storms can cause major impacts across power, telecoms, aviation, and satellite networks. Yet few organisations currently plan for them with rigour.
- Historically, even moderate space weather events have triggered widespread business impacts from blackouts, satellite loss and GPS disruptions.
- Combining infrastructure resilience, operational preparedness and insurance solutions can help risk managers mitigate business impacts from future storms.
Geomagnetic storms, caused by solar activity like coronal mass ejections (CMEs), pose significant risks to critical systems such as power grids, satellite networks, aviation, communications, and cloud-based services. These storms can induce electrical currents in grounded infrastructure, leading to disruptions that can cascade across interconnected systems. The current solar cycle, peaking in 2024-2025, heightens the risk of such events.
The economic impact of severe geomagnetic storms can be substantial. Modelling estimates potential economic losses from a severe event could reach US$9.1 trillion. Even less extreme scenarios could result in losses starting from US$1.2 trillion. Despite the well-documented nature of these incidents, forecasting remains imprecise, making preparedness a more practical focus for risk management.
To mitigate these risks, a multi-layered strategy combining infrastructure adaptation, operational readiness, and policy alignment is essential. Governments and regulators play a vital role in strengthening forecasting and legislating for resilience planning. Cross-industry collaboration is also crucial for developing robust response frameworks. As the current solar cycle peaks, organisations should reassess their preparedness for geomagnetic storms.
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