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Disasters are already spurring Americans to renovate their homes.
Home remodeling is something of an American subculture. Shows like Property Brothers, Fixer Upper, and Flip or Flop have sold us on the glamour, the righteousness, even, of taking hammers and drills and panels of drywall to old houses and making them appealing to Brooklynites with babies, replete with stainless steel and minimalist tiling. All that work doesn’t come cheap: The remodeling industry, as of 2021, is a $500 billion juggernaut.
But remodeling is good for more than just aesthetics: It’s also, increasingly, becoming an essential tool for living with the effects of climate change.
According to a new study from Harvard’s Joint Center for Housing Studies (JCHS), Americans are spending more money on repairing houses that were damaged by disasters — between $20 and $25 billion in 2020 and 2021, up from an average of $17 billion in the 2010s and $12 billion in the 2000s. These huge sums alone indicate the increasing toll disasters are taking on Americans; both 2020 and 2021 saw at least 20 so-called “billion-dollar disasters,” or single disasters that caused damages north of a billion dollars each.
“Historically, people focused on improving their homes,” said Carlos Martín, project director of the Remodeling Futures program at JCHS. Take, for example, the stainless steel and crisp tiling: They’re primarily aesthetic improvements that might bring some side benefits, like energy-efficiency. “What we're seeing now is that it's almost an even balance [between upkeep and improvements],” Martín said. “More people are doing repairs just to keep up their homes.”
In part, this is just because American housing stock is the oldest it’s ever been: As of 2021, the median age of owner-occupied homes in the country is 41 years old, and they’re starting to show their age. As extreme weather becomes more common, however, those repairs will be even more pressing; a well-maintained home will be better insulated against the forces of nature, whether they be headline-grabbing hurricanes and wildfires or the more quotidian snow, hail, or wind that is responsible for nearly half of the money spent on repairs in 2020 and 2021.
The problem (surprise!) is money. Remodeling is expensive, and while policies like the Inflation Reduction Act will help homeowners pay for climate-mitigation upgrades like heat pumps that will reduce household emissions, there’s no policy analogue for disaster-mitigating upgrades. Homeowners usually only receive assistance after a disaster hits, in the form of insurance payouts.
“Unfortunately, our climate policy is disaster policy in this country,” Martín said.
American housing is already deeply inequitable, and the cost of preparing for — or repairing after — a disaster only deepens that inequity. Households of color make up only 27 percent of all the homeowners in the country, and they tend to be less able to pay for renovations: according to the report, white homeowners have nearly three times as much median wealth as Black homeowners and nearly double the wealth of Hispanic homeowners.
These disparities are dominoes: Lower-income homeowners tend to only be able to purchase homes that are already in a less-than-ideal state, which drives up the cost of repairs. This leaves them more vulnerable to damage from extreme weather, which can send repair costs even higher.
The result is that, more often than not, homeowners just wait and see if a disaster hits — and if it does, to rely on insurance payments to rebuild. This can sometimes mean their homes are repaired to a higher standard, using new materials that weren’t around before or, if they were entirely destroyed in a disaster, built to new codes that may include better hardening against storms.
This is, of course, not a solution at all, for the simple fact that it forces people to wait until their home is destroyed to have a chance at ... preventing their home from being destroyed. And, because insurance companies are insurance companies, most homeowners — particularly if they’re not rich and lawyered up — have to wait interminably long to have their claims paid out. Houstonians, for example, are stillrebuilding after the damage caused to their city by Hurricane Harvey in 2017.
Some privately-administered incentives for disaster preparedness do exist, usually in the form of insurance companies offering lowered premiums for making changes such as installing storm shutters or raising houses in hurricane-prone areas. But those upgrades still come with large upfront costs, and the programs aren’t available everywhere.
People also tend to underestimate their personal risk, which means they undervalue the benefits of mitigating that risk. They might be willing to invest in electrification and energy-efficiency upgrades, such as a heat pump, new refrigerator, or an electric vehicle, because those products have a dual use: They lower the climate impact of a household while also providing an increased level of comfort for its inhabitants. Disaster-proofing, however, only proves its worth when disasters hit. Flood insurance is a classic example: Insurance companies see an uptick in flood insurance sign-ups in the immediate aftermath of floods hitting a region, but policyholders tend to drop their coverage if there are no floods for a few years.
As extreme weather becomes more common, this might be less of an issue. “If these events are more frequent, people will realize there‘s a benefit,” Martín said. “Just because then they don’t have to wait two or three years, or for their insurance to kick in. They’ll see the immediate benefit.”
That makes creating policies to fund preventative remodeling — an IRA for disaster-proofing, essentially — even more pressing; as the most recent IPCC report made clear, the world needs to both acknowledge and prepare for the effects of climate change while still trying to reduce emissions.
Martín also thinks the country is badly in need of a national conversation about property insurance akin to the health care shifts we saw a little over a decade ago with the implementation of Obamacare. One way to start is by establishing a framework that would incentivize insurance companies to help defray the costs of protecting homes; doing so now would inevitably reduce the downstream costs for government, insurance companies, and homeowners alike.
It would also provide a way to preserve the deep-rooted relationships people have with the places they call home. While it’s easy to just tell people to move away from disaster-prone areas, that does little to acknowledge the realities of how people live — or the fact that climate change is going to affect every place on the planet in different ways, and some of the best adaptation measures will be found within the places we live and work.
“There are lots of other climate effects,” Martín said. “Flooding from sea level rise or hurricanes is only one effect. You can't build a seawall for heat.”
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Current conditions: States left flooded from recent severe storms are now facing freezing temperatures • Firefighters are battling blazes in Scotland due to unusually warm and dry weather • Hospitals in India are reporting a 25% rise in heat-related illnesses compared to last year. Yesterday the country’s northern state of Rajasthan reached 115 degrees Fahrenheit, about 13 degrees higher than seasonal norms.
President Trump’s sweeping new tariffs came into effect at 12:01 a.m. on Wednesday, rattling the world’s markets and raising the risk of a global trade war. The levies, which include a 104% tariff on Chinese imports, triggered a mass sell-off in U.S. Treasury bonds, hiking yields as investors worry about a potential recession and flock to alternative safe-haven investments. The price of oil fell for the fifth day in a row to its lowest since 2021, with Brent futures at about $61 per barrel, well below the $65 level that oil producers need in order to turn a profit drilling new wells nationwide. As Heatmap’s Robinson Meyer explained recently, the tariffs are an outright catastrophe for the oil industry because they threaten a global downturn that would hurt oil demand at a time when oil cartel OPEC+ is increasing its output. Trump’s slate of tariffs will impact the cost of just about everything, from gasoline to e-bikes to LNG to cars. China imposed retaliatory tariffs, increasing them from 34% to 84% in response to the U.S. escalation. Meanwhile, the European Union will vote today on whether to impose its own retaliatory fees. European shares plummeted, as did Asian and Australian stocks.
As Heatmap’s Emily Pontecorvo reported today, a new study published in the journal Nature Climate Change finds that the transition to clean energy could create a world that is less exposed to energy price shocks and other energy-related trade risks than the world we have today. “We have such a concentration of fossil resources in a few countries,” Steven Davis, a professor of Earth system science at Stanford and the lead author of the study, told Pontecorvo. Transition minerals, by contrast, are less geographically concentrated, so “you have this ability to hedge a little bit across the system.”
The White House issued several executive orders on Tuesday aimed at boosting U.S. coal production and use, pointing to rising electricity demand from artificial intelligence. The series of orders direct federal agencies to:
Trump also said he plans to invoke the Defense Production Act to spur mining operations, “a move that could put the federal purse behind reviving the fading industry,” Reutersreported. Coal is the dirtiest fossil fuel, and its use has been in decline since 2007. As of last year, wind and solar combined surpassed coal for U.S. electricity generation.
President Trump signed a separate executive order on Tuesday that targets climate laws at the state level and seeks to remove threats to U.S. “energy dominance,” including “illegitimate impediments to the identification, development, siting, production, investment in, or use of domestic energy resources — particularly oil, natural gas, coal, hydropower, geothermal, biofuel, critical mineral, and nuclear energy resources.” The order references “state overreach” and suggests that some state and local governments are overstepping their constitutional authority in regulating energy through interstate trade barriers or fines on energy producers. It calls out New York and Vermont for their climate change superfund laws that require fossil fuel companies to pay for their planet-warming greenhouse gas emissions. And it mentions California’s carbon cap-and-trade system.
The executive order directs the U.S. attorney general to compile a list of all state and local laws “purporting to address ‘climate change,’” along with ESG, environmental justice, carbon taxes, and anything involving “carbon or ‘greenhouse gas’ emissions,” and put a stop to their enforcement. “The federal government cannot unilaterally strip states’ independent constitutional authority,” New York Governor Kathy Hochul and New Mexico Governor Michelle Lujan Grisham said in a statement. “We are a nation of states — and laws — and we will not be deterred. We will keep advancing solutions to the climate crisis that safeguard Americans’ fundamental right to clean air and water, create good-paying jobs, grow the clean energy economy, and make our future healthier and safer.”
Wood Mackenzie issued its annual U.S. wind energy report this week. It finds that 2024 marked the worst year for new onshore wind capacity in the past decade, with just 3.9 gigawatts installed. Through 2029, the firm expects developers to install another 33 gigawatts of onshore capacity, 6.6 gigawatts of offshore capacity, and carry out 5.5 gigawatts of upgrades and refurbishings. The five-year outlook marks “a 40% decrease quarter-on-quarter from a previous total of 75.8 gigawatts.” The report warns of enduring “uncertainty” thanks to the Trump administration’s attacks on the wind industry. “Growth will happen, but it’s going to be slower,” wrote Michelle Lewis at Electrek. “[Trump] has managed to get some projects canceled, and he’ll make things more of a slog over the next few years.”
President Trump has pulled the U.S. out of international talks to decarbonize the shipping industry and vowed to reciprocate against any fees on U.S. ships, Politicoreported. The International Maritime Organization's Maritime Environmental Protection Conference is unfolding this week in London, where negotiators are trying to agree on a policy to curb shipping pollution through carbon taxation. Shipping accounts for about 3% of global greenhouse gas emissions. Trump reportedly sent a letter to the conference saying “the U.S. rejects any and all efforts to impose economic measures against its ships based on GHG emissions or fuel choice. Should such a blatantly unfair measure go forward, our government will consider reciprocal measures so as to offset any fees charged to U.S. ships and compensate the American people for any other economic harm from any adopted GHG emissions measures.”
“What’s next, a mandate that Americans must commute by horse and buggy?”
–Kit Kennedy, a managing director at the Natural Resources Defense Council, in response to Trump’s executive orders aimed at revitalizing the U.S. coal industry.
Rob and Jesse get into the nitty gritty on China’s energy policy with Joanna Lewis and John Paul Helveston.
China’s industrial policy for clean energy has turned the country into a powerhouse of solar, wind, battery, and electric vehicle manufacturing.
But long before the country’s factories moved global markets — and invited Trump’s self-destructive tariffs — the country implemented energy and technology policy to level up its domestic industry. How did those policies work? Which tools worked best? And if the United States needs to rebuild in the wake of Trump’s tariffs, what should this country learn?
On this week’s episode of Shift Key, Rob and Jesse talk with two scholars who have been studying Chinese industrial policy since the Great Recession. Joanna Lewis is the Provost’s Distinguished Associate Professor of Energy and Environment and Director of the Science, Technology and International Affairs Program at Georgetown University's School of Foreign Service. She’s also the author of Green Innovation in China. John Paul Helveston is an assistant professor in engineering management and systems engineering at George Washington University. He studies consumer preferences and market demand for new technologies, as well as China’s longstanding gasoline car and EV industrial policy. Shift Key is hosted by Robinson Meyer, the founding executive editor of Heatmap, and Jesse Jenkins, a professor of energy systems engineering at Princeton University.
Subscribe to “Shift Key” and find this episode on Apple Podcasts, Spotify, Amazon, or wherever you get your podcasts.
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Here is an excerpt from our conversation:
Robinson Meyer: One kind of classical hard problem about industrial policy is selecting the technology that is going to eventually be a winner. And there’s a few ways to get around this problem. One is to just make lots of bets.
One thing that’s been a little unclear to me about the set of technology bets that China has made is that it has seemed to pick a set of technologies that are now extremely competitive globally, and it did seem to pick up on those technologies before Western governments or firms really got to them. Is that entirely because China just made a bunch of technology bets and it happened that these are the ones that worked out? Is it because China could look ahead to the environmental needs of the world and the clean development needs of the world and say, well, there’s probably going to be a need for solar? There’s probably going to be a need for wind? There’s probably going to be a need for EVs? Or is it a third thing, which is that China’s domestic needs, its domestic energy security needs, just happen to align really well with the direction of development that the world is kind of interested in moving in anyway.
John Paul Helveston: All of the above. I don’t know — like, that’s the answer here. I’ll add one thing that’s a little bit nuanced: There’s been tremendous waste. I’ll just put that out there. There’s been all kinds of investments that did not pan out at all, like semiconductors for a long, long time. Just things that didn’t work.
I think where China has had a lot of success is in areas where … It’s like the inverse of what the United States innovation ecosystem does well. China’s ecosystem is really driven around production, and a lot of that is part of the way the government’s set up, that local provinces have a ton of power over how money gets spent, and often repurpose funds for export-oriented production. So that’s been a piece of the engine of China’s economic miracle, is mass producing everything.
But there’s a lot of knowledge that goes along with that. When you look at things like solar, that technology goes back many, many decades for, you know, satellites. But making it a mass produced product for energy applications requires production innovations. You need to get costs down. You need to figure out how to make the machine that makes the machine. And that is something that the Chinese ecosystem does very well.
So that’s one throughline across all of these things, is that the technology got to a certain level of maturity where production improvements and cost decreases were the bigger things that made them globally competitive. I don’t think anyone would be considering an EV if we were still looking at $1,000 a kilowatt hour — and we were there just 15 years ago. And so that’s the big thing. It’s just production. I don’t know if they’ve been exceptionally good at just picking winners, but they’re good at picking things that can be mass produced.
Music for Shift Key is by Adam Kromelow.
That’s according to new research published today analyzing flows of minerals and metals vs. fossil fuels.
Among fossil fuel companies and clean energy developers, almost no one has been spared from the effects of Trump’s sweeping tariffs. But the good news is that in general, the transition to clean energy could create a world that is less exposed to energy price shocks and other energy-related trade risks than the world we have today.
That’s according to a timely study published in Nature Climate Change on Wednesday. The authors compared countries’ trade risks under a fossil fuel-based energy economy to a net-zero emissions economy, focusing on the electricity and transportation sectors. The question was whether relying on oil, gas, and coal for energy left countries more or less exposed than relying on the minerals and metals that go into clean energy technologies, including lithium, cobalt, nickel, and uranium.
First the researchers identified which countries have known reserves of which resources as well as those countries’ established trading partners. Then they evaluated more than a thousand pathways for how the world could achieve net-zero emissions, each with different amounts or configurations of wind, solar, batteries, nuclear, and electric vehicles, and measured how exposed to trade risks each country would be under each scenario.
Ultimately, they found that most countries’ overall trade risks decreased under net-zero emissions scenarios relative to today. “We have such a concentration of fossil resources in a few countries,” Steven Davis, a professor of Earth system science at Stanford and the lead author of the study, told me. Transition minerals, by contrast, are less geographically concentrated, so “you have this ability to hedge a little bit across the system.”
The authors’ metric for trade risk is a combination of how dependent a given country is on imports and how many trading partners it has for a given resource, i.e. how diverse its sourcing is. “If you have a large domestic supply of a resource, or you have a large trade network, and you can get that resource from lots of different trading partners, you're in a relatively better spot,” Davis said.
Of course, this is a weird time to conclude that clean energy is better equipped to withstand trade shocks. As my colleagues at Heatmap have reported, Trump’s tariffs are hurting the economics of batteries, renewables, and minerals production, whether domestic or not. The paper considers risks from “random and isolated trade shocks,” Davis told me, like losing access to Bolivian lithium due to military conflict or a natural disaster. Trump’s tariffs, by contrast, are impacting everything, everywhere, all at once.
Davis embarked on the study almost two years ago after working as a lead author of the mitigation section of the Fifth National Climate Assessment, a report delivered to Congress every four years. A lot of the chapter focused on the economics of switching to solar and wind and trying to electrify as many end uses of energy as possible, but it also touched on considerations such as environmental justice, water, land, and trade. “There's this concern of having access to some of these more exotic materials, and whether that could be a vulnerability,” he told me. “So we said, okay, but we also know we're going to be trading a lot less fossil fuels, and that is probably going to be a huge benefit. So let's try to figure out what the net effect is.”
The study found that some more affluent countries, including the United States, could see their energy security decline in net-zero scenarios unless their trade networks expand. The U.S. owns 23% of the fossil reserves used for electricity generation, but only 4% of the critical materials needed for solar panels and wind turbines.
One conclusion for Davis was that the U.S. should be much more strategic about its trade partnerships with countries in South America and Sub-Saharan Africa. Companies are already starting to invest in developing mineral resources in those regions, but policymakers should make a concerted effort to develop those trade relationships, as well. The study also discusses how governments can reduce trade risks by investing in recycling infrastructure and in research to reduce the material intensity of clean energy technologies.
Davis also acknowledged that focusing on the raw materials alone oversimplifies the security question. It also matters where the minerals are processed, and today, a lot of that processing happens in China, even for minerals that don’t originate there. That means it will also be important to build up processing capacity elsewhere.
One caveat to the paper is that comparing the trade risks of fossil fuels and clean energy is sort of apples and oranges. A fossil fuel-based energy system requires the raw resource — fuel — to operate. But a clean energy system mostly requires the raw materials in the manufacturing and construction phase. Once you have solar panels and wind turbines, you don’t need continuous commodity inputs to get energy out of them. Ultimately, Davis said, the study’s conclusions about the comparative trade risks are probably conservative.
“Interrupting the flow of some of these transition materials could slow our progress in getting to the net zero future, but it would have much less of an impact on the actual cost of energy to Americans,” he said. “If we can successfully get a lot of these things built, then I think that's going to be a very secure situation.”