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On insurance and extreme weather, Nissan’s new business plan, and paint that cools
Current conditions: A cloud of Saharan dust is sweeping toward southern Europe • Malaysia’s oppressive heat wave could last through mid-April • The water temperature is about 48 degrees Fahrenheit in Baltimore Harbor, where rescuers are searching for survivors after the collapse of the Francis Scott Key Bridge.
Extremely costly natural disasters have become “a new norm,” and insured losses will double in 10 years due to climate change, according to one of the world’s largest reinsurers. In a report published today, Swiss Re, a firm that provides insurance for insurers, calculated that natural disasters resulted in insured losses of $108 billion in 2023, marking the fourth consecutive year of losses exceeding $100 billion. As Bloombergnoted, “only about 40% of economic losses globally are insured, meaning the total economic losses are much higher.”
The main reason losses were so high was the sheer frequency with which “medium severity” disasters occurred. These are events that cost between $1 billion and $5 billion, and they’re on the rise. Severe thunderstorms (also called severe convective storms, or SCS) have become “the second largest loss-making peril” behind tropical cyclones. The Midwest accounted for the highest percentage of insured losses from severe thunderstorms in the U.S. last year:
Swiss Re
The report calls for adaptation measures, but concludes that “in the face of climate change, adaptation and insurance can only go so far. Mitigation of greenhouse gas emissions is also essential to counter the build-up of physical risks.”
Nissan yesterday announced a new business plan it hopes will “ensure sustainable growth and profitability” as it faces competition from Chinese rivals. Perhaps unsurprisingly, the strategy leans heavily on electric vehicles. The Japanese carmaker will launch 16 new EV models over the next three years and slash EV manufacturing costs by 30% in an effort to reach cost parity with internal combustion engine vehicles by 2030. It’ll bring down costs by incorporating battery innovations and new manufacturing processes. And the company will make EVs in “families,” starting with a “main vehicle” and then building on that design with new variations that can be significantly cheaper and faster to produce.
The New York Stock Exchange yesterday halted trading of electric vehicle startup Fisker Inc.’s shares and said it planned to delist the stock due to “abnormally low” share prices. The company had been in talks with a major automaker about a potential investment, but the deal fell through, which means its financials are in bad shape and bankruptcy may be looming. If the cash-strapped company fails, it would join the ranks of other embattled EV startups including Aptera and Detroit Automotive. Last week Fisker paused its EV production.
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Trader Joe’s is hiking the price of bananas for the first time in two decades. The grocery chain has long sold individual bananas for just 19 cents, but has raised the price to 23 cents. A spokesperson told CNN the change was due to cost increases. Earlier this month, industry experts gathering at the World Banana Forum warned that climate change was hurting banana production and supply chains and that this would soon result in higher banana prices for consumers.
Special “cooling” paint can significantly reduce the temperatures of surfaces in cities and help pedestrians feel cooler, according to a new study published in the journal Sustainable Cities and Society. The research is the first demonstration of how paints made to reflect the sun’s heat actually perform in the real world. For the study, researchers at Singapore’s Nanyang Technological University covered surfaces such as walls, rooftops, and pavements in an industrial neighborhood in Singapore. They found those surfaces were up to 2 degrees Celsius cooler than uncoated areas during the hottest time of the day, and that this helped pedestrians feel 1.5 degrees cooler. “This is a minimally intrusive solution for urban cooling that has an immediate effect,” said the study’s lead author, Dr. E V S Kiran Kumar Donthu. “By reducing the amount of heat absorbed in urban structures, we also reduce heat load in buildings, consequently reducing indoor air-conditioning energy consumption.” Below you can see some of the coated test surfaces:
Nanyang Technological University
Ohio has approved the Oak Run Solar Project, a 6,000-acre solar farm in Madison County that will also graze 1,000 sheep and grow crops. The farm will be the nation’s largest “agrivoltaics” project.
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The Loan Programs Office is good for more than just nuclear funding.
That China has a whip hand over the rare earths mining and refining industry is one of the few things Washington can agree on.
That’s why Alex Jacquez, who worked on industrial policy for Joe Biden’s National Economic Council, found it “astounding”when he read in the Washington Post this week that the White House was trying to figure out on the fly what to do about China restricting exports of rare earth metals in response to President Trump’s massive tariffs on the country’s imports.
Rare earth metals have a wide variety of applications, including for magnets in medical technology, defense, and energy productssuch as wind turbines and electric motors.
Jacquez told me there has been “years of work, including by the first Trump administration, that has pointed to this exact case as the worst-case scenario that could happen in an escalation with China.” It stands to reason, then, that experienced policymakers in the Trump administration might have been mindful of forestalling this when developing their tariff plan. But apparently not.
“The lines of attack here are numerous,” Jacquez said. “The fact that the National Economic Council and others are apparently just thinking about this for the first time is pretty shocking.”
And that’s not the only thing the Trump administration is doing that could hamper American access to rare earths and critical minerals.
Though China still effectively controls the global pipeline for most critical minerals (a broader category that includes rare earths as well as more commonly known metals and minerals such as lithium and cobalt), the U.S. has been at work for at least the past five years developing its own domestic supply chain. Much of that work has fallen to the Department of Energy, whose Loan Programs Office has funded mining and processing facilities, and whose Office of Manufacturing and Energy Supply Chains hasfunded and overseen demonstration projects for rare earths and critical minerals mining and refining.
The LPO is in line for dramatic cuts, as Heatmap has reported. So, too, are other departments working on rare earths, including the Office of Manufacturing and Energy Supply Chains. In its zeal to slash the federal government, the Trump administration may have to start from scratch in its efforts to build up a rare earths supply chain.
The Department of Energy did not reply to a request for comment.
This vulnerability to China has been well known in Washington for years, including by the first Trump administration.
“Our dependence on one country, the People's Republic of China (China), for multiple critical minerals is particularly concerning,” then-President Trump said in a 2020 executive order declaring a “national emergency” to deal with “our Nation's undue reliance on critical minerals.” At around the same time, the Loan Programs Office issued guidance “stating a preference for projects related to critical mineral” for applicants for the office’s funding, noting that “80 percent of its rare earth elements directly from China.” Using the Defense Production Act, the Trump administration also issued a grant to the company operating America's sole rare earth mine, MP Materials, to help fund a processing facility at the site of its California mine.
The Biden administration’s work on rare earths and critical minerals was almost entirely consistent with its predecessor’s, just at a greater scale and more focused on energy. About a month after taking office, President Bidenissued an executive order calling for, among other things, a Defense Department report “identifying risks in the supply chain for critical minerals and other identified strategic materials, including rare earth elements.”
Then as part of the Inflation Reduction Act in 2022, the Biden administration increased funding for LPO, which supported a number of critical minerals projects. It also funneled more money into MP Materials — including a $35 million contract from the Department of Defense in 2022 for the California project. In 2024, it awarded the company a competitive tax credit worth $58.5 million to help finance construction of its neodymium-iron-boron magnet factory in Texas. That facilitybegan commercial operation earlier this year.
The finished magnets will be bought by General Motors for its electric vehicles. But even operating at full capacity, it won’t be able to do much to replace China’s production. The MP Metals facility is projected to produce 1,000 tons of the magnets per year.China produced 138,000 tons of NdFeB magnets in 2018.
The Trump administration is not averse to direct financial support for mining and minerals projects, but they seem to want to do it a different way. Secretary of the Interior Doug Burgum has proposed using a sovereign wealth fund to invest in critical mineral mines. There is one big problem with that plan, however: the U.S. doesn’t have one (for the moment, at least).
“LPO can invest in mining projects now,” Jacquez told me. “Cutting 60% of their staff and the experts who work on this is not going to give certainty to the business community if they’re looking to invest in a mine that needs some government backstop.”
And while the fate of the Inflation Reduction Act remains very much in doubt, the subsidies it provided for electric vehicles, solar, and wind, along with domestic content requirements have been a major source of demand for critical minerals mining and refining projects in the United States.
“It’s not something we’re going to solve overnight,” Jacquez said. “But in the midst of a maximalist trade with China, it is something we will have to deal with on an overnight basis, unless and until there’s some kind of de-escalation or agreement.”
A conversation with VDE Americas CEO Brian Grenko.
This week’s Q&A is about hail. Last week, we explained how and why hail storm damage in Texas may have helped galvanize opposition to renewable energy there. So I decided to reach out to Brian Grenko, CEO of renewables engineering advisory firm VDE Americas, to talk about how developers can make sure their projects are not only resistant to hail but also prevent that sort of pushback.
The following conversation has been lightly edited for clarity.
Hiya Brian. So why’d you get into the hail issue?
Obviously solar panels are made with glass that can allow the sunlight to come through. People have to remember that when you install a project, you’re financing it for 35 to 40 years. While the odds of you getting significant hail in California or Arizona are low, it happens a lot throughout the country. And if you think about some of these large projects, they may be in the middle of nowhere, but they are taking hundreds if not thousands of acres of land in some cases. So the chances of them encountering large hail over that lifespan is pretty significant.
We partnered with one of the country’s foremost experts on hail and developed a really interesting technology that can digest radar data and tell folks if they’re developing a project what the [likelihood] will be if there’s significant hail.
Solar panels can withstand one-inch hail – a golfball size – but once you get over two inches, that’s when hail starts breaking solar panels. So it’s important to understand, first and foremost, if you’re developing a project, you need to know the frequency of those events. Once you know that, you need to start thinking about how to design a system to mitigate that risk.
The government agencies that look over land use, how do they handle this particular issue? Are there regulations in place to deal with hail risk?
The regulatory aspects still to consider are about land use. There are authorities with jurisdiction at the federal, state, and local level. Usually, it starts with the local level and with a use permit – a conditional use permit. The developer goes in front of the township or the city or the county, whoever has jurisdiction of wherever the property is going to go. That’s where it gets political.
To answer your question about hail, I don’t know if any of the [authority having jurisdictions] really care about hail. There are folks out there that don’t like solar because it’s an eyesore. I respect that – I don’t agree with that, per se, but I understand and appreciate it. There’s folks with an agenda that just don’t want solar.
So okay, how can developers approach hail risk in a way that makes communities more comfortable?
The bad news is that solar panels use a lot of glass. They take up a lot of land. If you have hail dropping from the sky, that’s a risk.
The good news is that you can design a system to be resilient to that. Even in places like Texas, where you get large hail, preparing can mean the difference between a project that is destroyed and a project that isn’t. We did a case study about a project in the East Texas area called Fighting Jays that had catastrophic damage. We’re very familiar with the area, we work with a lot of clients, and we found three other projects within a five-mile radius that all had minimal damage. That simple decision [to be ready for when storms hit] can make the complete difference.
And more of the week’s big fights around renewable energy.
1. Long Island, New York – We saw the face of the resistance to the war on renewable energy in the Big Apple this week, as protestors rallied in support of offshore wind for a change.
2. Elsewhere on Long Island – The city of Glen Cove is on the verge of being the next New York City-area community with a battery storage ban, discussing this week whether to ban BESS for at least one year amid fire fears.
3. Garrett County, Maryland – Fight readers tell me they’d like to hear a piece of good news for once, so here’s this: A 300-megawatt solar project proposed by REV Solar in rural Maryland appears to be moving forward without a hitch.
4. Stark County, Ohio – The Ohio Public Siting Board rejected Samsung C&T’s Stark Solar project, citing “consistent opposition to the project from each of the local government entities and their impacted constituents.”
5. Ingham County, Michigan – GOP lawmakers in the Michigan State Capitol are advancing legislation to undo the state’s permitting primacy law, which allows developers to evade municipalities that deny projects on unreasonable grounds. It’s unlikely the legislation will become law.
6. Churchill County, Nevada – Commissioners have upheld the special use permit for the Redwood Materials battery storage project we told you about last week.