Britain could turn the growing threat of floods, heatwaves and drought into an economic opportunity worth as much as £355 billion over the next decade.
A new Government Office for Science report says the UK is already well placed to sell the engineering, insurance, data and technology needed to help countries survive a rapidly changing climate.
The study estimates the global market for climate adaptation could reach around £3.5 trillion between 2026 and 2035. British companies could capture between £154 billion and £355 billion of that spending, including exports worth £68 billion to £229 billion.
This is not about making money from climate misery while doing nothing to stop global warming. The report stresses cutting emissions remains essential but says the climate has already changed enough to make major investment in resilience unavoidable.
Without stronger adaptation, climate damage could reduce UK GDP by 3% to 4% by 2050 and as much as 7% to 8% by 2070. That cost would come through damaged buildings, broken infrastructure, disrupted businesses and falling productivity as extreme heat makes working harder.
Spending early can be far cheaper than repairing the damage afterwards.
The report says adaptation projects typically deliver around £4 of social and economic benefit for every £1 invested, with many producing returns within three years.
Those gains include avoided damage alongside new jobs, healthier communities and infrastructure that works more reliably.
The market covers everything from flood barriers and sustainable drainage to heat-resistant buildings, urban trees, resilient crops and coastal restoration.
It also includes air conditioning and cooling, early-warning systems, climate-risk software, catastrophe insurance and specialist financial products that help governments and companies pay for resilience.
Britain already has 648 identified adaptation goods and services on the market, split almost evenly between physical products and professional services.
The strongest activity is in land management, buildings, health, finance, energy and water, with UK companies particularly active in tackling flooding and extreme temperatures.
The biggest British advantage may not be manufacturing millions of cooling units or constructing every flood defence overseas. It lies in the high-value work surrounding those projects: modelling the risk, designing the solution, arranging the finance and insuring the assets.
London’s insurance and reinsurance market is one of the clearest opportunities.
The report estimates insurance could generate between £34 billion and £81 billion for the UK by 2035, while exported reinsurance could be worth another £46 billion to £134 billion.
Climate analytics is another major strength, drawing on the Met Office, universities, engineering consultancies and companies producing digital twins, sensors and decision-support software.
Around 60% of the digital and technology solutions examined were judged to have strong export potential, allowing the same systems to be sold across different countries without recreating the entire product each time.
UK engineers could also export the design and specialist expertise behind flood, water and resilient infrastructure projects even when local companies carry out the physical construction.
Precision farming, biosensors, climate-resistant agriculture and engineering biology offer further opportunities as countries try to protect food production from heat, drought and changing rainfall.
The report warns adaptation is still treated as a vague ambition rather than a clear market, with businesses often unsure what standards they must meet and investors unable to see how projects will produce a financial return.
Government could create demand by placing stronger resilience requirements into building rules, infrastructure funding and planning decisions. Local authorities could also combine smaller schemes into investible regional programmes rather than trying to finance isolated projects individually.
Better public climate data would allow banks, insurers and investors to compare risks properly and reward buildings and businesses that have protected themselves.
At present, a company investing in flood protection or heat resilience does not necessarily receive cheaper insurance or better borrowing terms, weakening the incentive to spend.
If the UK can demonstrate successful flood protection, resilient housing, urban cooling and climate-smart infrastructure here, it can sell the technology, expertise, finance and insurance overseas as the global market expands.
