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Rob and Jesse talk with Wharton’s Benjamin Keys, then dig into Trump’s big Day One.
The Los Angeles wildfires have killed at least 27 people, destroyed more than 17,000 structures, and displaced tens of thousands. In the next few months, the billions of costs in damage to homes and property will ripple through the state’s insurance market — and likely cause its insurer of last resort to run out of money.
Benjamin Keys has studied how natural disasters, rising sea levels, and increasing exposure to risk have driven up insurance costs nationwide. He is a professor of real estate and finance at the University of Pennsylvania’s Wharton School, and one of the country’s top experts on climate change, home values, and insurance markets.
On this week’s episode of Shift Key, Rob and Jesse talk with Keys about how California broke its insurance market, why insurance costs are rising nationwide, and how homeowners, home buyers, and communities can protect themselves. They dive into President Donald Trump’s dizzying first day of executive actions and how they’ll affect the future of energy development. 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:
Jesse Jenkins: We should have warned you ahead of time that this podcast always devolves back to the tri-state area. It’s just sort of inevitable. We saw this dynamic on the Jersey Shore after Hurricane Sandy, where a lot of more working class-type communities that had homes there, they ended up either getting wiped out or having to leave and sell, and moving out. And what replaced them were very large houses — some of them built in a more secure way, up above the floodplain on elevated floors. But most of them, as I understand it, don’t have insurance.
So they are self insured, in the sense that people think they’re wealthy enough that they can just absorb the loss. That’s one type of self insurance. The folks who are coming off the federal flood insurance plan are probably folks who are not really self insured. They can’t diversify there. They don’t have enough wealth to absorb that risk. They’re just simply exposed now and rolling the dice.
Benjamin Keys: And for the time being, the cost of flood insurance is still subsidized. And so, you know, even if you see your rate jump by 18% and you say, wow, that’s expensive, it’s going to get substantially worse. And so it’s a huge mistake to leave that path, and have interrupted flood coverage. That’s a tough one. And you know, most of the flood policies that are out there are mandatory. Those are ones that are being required by the mortgage market that, say, if you live in a flood zone, you have to have flood insurance.
So actually, I have flood insurance on my house in Philadelphia. I live close enough to the Schuylkill River, a couple of blocks away, that — and my neighborhood did flood just a few years ago. We fortunately weren’t harmed by it, but that flood insurance policy is mandated by the mortgage market. And so that’s where most of the coverage comes from.
But when you look at the voluntary take-up of flood insurance, it’s very low.
Jenkins: Are we likely to see something similar for wildfire risk? That effectively, insurers say, we'll continue to write policies in California, but if you're in a wildfire prone area, we're not going to give you wildfire insurance, which would create a kind of similar issue.
Keys: It's possible that we could see a national wildfire program or a broader national disaster program develop. The insurance industry would love to carve out these risks, right? These are very difficult things.
This episode of Shift Key is sponsored by …
Intersolar & Energy Storage North America is the premier U.S.-based conference and trade show focused on solar, energy storage, and EV charging infrastructure. To learn more, visit intersolar.us.
Music for Shift Key is by Adam Kromelow.
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After Trump’s executive orders took aim at wind developers, they’re mostly keeping a stoic silence.
The newly inaugurated president does not like the wind industry. Especially the offshore wind industry.
Donald Trump Monday night issued an expansive executive order targeting the sector that the industry is only just starting to digest. And while the executive order was mostly being seen as a pause or moratorium on new offshore leasing, it could have much more wide-ranging effects. It calls for the Secretary of the Interior and the Attorney General to “conduct a comprehensive review of the ecological, economic, and environmental necessity of terminating or amending any existing wind energy leases, identifying any legal bases for such removal,” thus calling gigawatts of existing, permitted projects into doubt.
“The executive order pausing new offshore wind leasing and permitting is a blow to the American offshore wind industry and hurts the hundreds of U.S. supply chain companies and thousands of workers already building more American energy,” Liz Burdock, the chief executive officer of the Oceantic Network, an offshore wind industry group, said in a statement. “Today’s actions threaten to strand $25 billion already flowing into new ports, vessels, and manufacturing centers, and curtail future investments across our country.” Companies that have active offshore projects have been largely mum on the order. A spokesperson for Orsted, the Danish company behind the under-construction Revolution Wind project off the coast of Rhode Island and the Sunrise Wind project off the coast of Long Island, told me only that it was “in the process of reviewing it to assess the impact on our portfolio.”
A spokesperson for Equinor, which is working on the Empire Wind project, projected to start serving New York City in 2026, told me, “Equinor is committed to advancing a broad energy portfolio that supports a domestic supply chain, generates skilled jobs, and makes a lasting contribution to American energy security. We will continue to assess all policy developments and work with the Trump administration as we deliver long-term energy solutions for the growing American economy.”
Several other major offshore and onshore wind developers, including Pattern Energy, Avangrid, and NextEra either did not respond to requests for comment or would not comment on their ongoing projects in light of the order.
Trade group officials and outside experts were skeptical that the order would stop projects currently under construction like Revolution Wind, Vineyard Wind in Massachusetts, or the Coastal Virginia Offshore Wind Project, backed by the utility Dominion. Projects like Empire and Sunrise Wind, which have started some onshore construction, may survive as well. But the Biden Administration also permitted a flurry of projects in its final year, including SouthCoast Wind, New England Wind, Atlantic Shores South, and the Maryland Offshore Wind Project, and those may now be in doubt.
“Projects with steel in the water are probably safe,” Cy McGeady, a fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies, told me. “I’d be shocked if a project with steel in the water has its permit revoked.” But of those that haven’t yet gotten started, he cautioned, “It’s those projects that are most at risk.”
Shares of Orsted fell over 9% in the United States Tuesday after the company announced $1.7 billion in impairments due to delays on its Sunrise Wind project — not related to the executive orders. The company also said it was marking down the value of its leases off the coasts of New Jersey, Maryland, and Delaware, and cited “considerably increased project costs,” as well as delays linked to transmission equipment for the wind turbines.
“Delivering the project within the updated schedule and cost is an absolute top priority for Orsted,” the company’s chief executive Mads Nipper said in a statement on the accounting changes.
The executive order comes after a dreadful few years for the offshore wind industry, which has been hammered by high costs, delays, and interest rate hikes, which led to several project cancellations even before Trump’s victory. The wind industry as a whole has seen slowing growth, thanks to difficulties building adequate transmission, exposure to high interest rates, and rising local opposition. New wind energy additions in the United States peaked in 2020 and 2021 with 14 gigawatts of added capacity, falling to just over 6 gigawatts in 2023.
The executive order also, at best, means no more new leasing for the duration of Trump’s time in office, calling into question the growth prospects of the whole offshore wind industry in the United States. Onshore wind may be on firmer ground, as many projects, especially in Texas, are not built on federal lands and do not require the full federal permitting process to be built.
“If the growth prospects are curtailed or drastically limited or at least diminished for the next four-plus years,” McGeady told me, referring to the offshore wind industry, “then it’s much harder to justify costs in the near term investment and expenditure of capital for an industry that might never launch.”
Not that the movie was correct, but it wasn’t totally wrong — and we could soon face the consequences.
At 2:30 a.m. on June 6, 1998, Whitley Strieber awoke to a knock on his hotel door. Strieber, a UFOologist — that is, a scholar of unidentified flying objects and other paranormal phenomena — was in Toronto that night on tour, promoting his latest book, and he groggily got up to let his visitor in, assuming it was room service. It wasn’t.
According to Strieber, he and his nocturnal visitor proceeded to speak on a wide range of topics in his room over the next half hour. Although he never heard from the man again after that night, Strieber took notes during their meeting, during which the visitor tipped him off about “what was then rather obscure climatology,” Strieber told me. Specifically — according to Strieber — the visitor told him about the pending collapse of the Atlantic Meridional Overturning Circulation, or AMOC, the system sometimes described as the oceanic conveyor belt responsible for influencing the climate of the Northern Hemisphere.
The late-night conversation became the premise of Strieber’s next book, 1999’s The Coming Global Superstorm, which he co-wrote with the paranormal radio show host Art Bell. The scientific community was not exactly impressed by the work: “I think they’d rather forget I even exist,” Strieber told me. (Bell died in 2018.)
But Strieber got the last laugh: The Coming Global Superstorm not only became the premise for The Day After Tomorrow, the 2004 disaster movie in which Dennis Quaid plays an NOAA paleoclimatologist, and New York freezes over and is beset by wolves, but recent modeling also indicates that the AMOC actually is slowing down. In some of the latest worst case scenario models, researchers say it could reach the point of no return, sending it into collapse as soon as this year. Once that happens, researchers predict that “the ice age pattern of a cooling north and warming south would play out again,” and while Northern Europe would bear the brunt of the effects, the Arctic temperatures experienced across North America this week — from a dangerously cold Inauguration Day to a blizzard warning for the Gulf Coast — could become a norm rather than an anomaly.
“I have watched [The Day After Tomorrow] a couple of times over the last few years, and I’m surprised at how the general premise isn’t that bad,” David Thornalley, a paleoceanographer at University College London, told me.
Of course, there is more wrong in The Day After Tomorrow (and The Coming Global Superstorm, for that matter) than there is right: Thornalley added that following an actual AMOC collapse, weather-related changes would take place on a “multi-decadal time scale” rather than in the mere weeks of exaggerated calamity depicted in the film.
Still, The Day After Tomorrow — which predated Al Gore’s An Inconvenient Truth by two years and was many Americans’ first introduction to the idea of anthropogenic extreme weather — can seem, in retrospect, to have been eerily prescient. It anticipated global warming-caused fresh water runoff from Greenland, which is upsetting the salinity of the ocean — essentially making it less dense — and breaking down the warm-and-cold water circulation across the globe that currently keeps our climate stable. With enough fresh water, the planet’s circulatory system could shut down for the first time since the Neanderthals went extinct.
And while Los Angeles isn’t going to be leveled by tornadoes and wolves won’t roam the tundra of Midtown Manhattan, Europe couldcool by as much as 1.5 degrees Celsius (2.7 degrees Fahrenheit), which would have disastrous consequences for the continent’s agriculture. Additionally, the sharp temperature disparities between Northern Europe and the Mediterranean region could result in expansive (albeit not global) storms. While the U.S. would likely dodge the worst of an AMOC-induced cooldown, an ensuing sea level rise would impact many of the nation’s populous and iconic seaboard cities.
As shrewd as Day After Tomorrow and its source material might seem now, research into the possibility of an AMOC collapse dates back to the work of oceanographer Henry Stommel, who made the ocean salinity-conveyor belt connection in 1961. “That wasn’t taken very seriously because it wasn’t really an ocean model but just a sort of conceptual view on salt and heat interaction on the density,” Henk Dijkstra, a professor of physical oceanography at Utrecht University and one of the authors of the recent modeling that points toward an impending AMOC collapse, told me.
By 1986, however, the field of paleoclimatology was expanding rapidly. Researchers sampled ice cores collected from places like Greenland, and learned that there had been “very abrupt changes in climate” in the past, Thornalley told me. The Northern Hemisphere “would appear to be switching from a warm climate to a cold climate — flickering back and forth. And [scientists] put two and two together.”
The news was something of a revelation. “We started to develop this paradigm that, yes, we’ve had abrupt climate change in the past, and we think we can relate it to these changes in the Atlantic circulation, and the climate models suggest that, if possible, it could happen in the future,” said Thornalley, who began his PhD the year that Day After Tomorrow was released. The precedent wasn’t exactly reassuring news — the last time the AMOC collapsed, after all, “there were massive ice sheets and wooly mammoths,” Thornalley added. “It’s not a nice world for humans to try and live in.”
Despite the dire warning in the ice cores, an AMOC collapse wasn’t on the public’s radar before its introduction via Quaid and Jake Gyllenhaal. That isn’t to say it wasn’t a buzzy topic of discussion in the scientific community (not to mention that of beings who make a habit of dropping in on UFOlogists in the wee hours of the night). “It was really a hot topic” in climate circles, Thornalley confirmed. The film was “very much of its time.”
The Day After Tomorrow’s scientific resonance today, then, is due more to the fact that AMOC modeling has continued to hone in on the theory of a pending collapse with precision than because of any stunning predictive qualities of the movie itself. The scientific community is still in deep debate over the possibilities and potential outcomes and timelines of the process — a new paper out last week even argues that the AMOC hasn’t been declining — but for all the messiness and caveats, Thornalley ultimately lands in a place not so far from Strieber’s own position. “I don’t think we should be happy to wait until we’re really confident because, by then, it’d be too late,” Thornalley told me. “It’d be rubbish if in 30 to 40 years time, [the AMOC has collapsed] and people go, ‘Well why didn’t you warn us about it?’ ‘Oh, because we wanted to make sure we were really, really, really sure.’
Modern modeling of an AMOC collapse circles back to its speculative offshoots in other ways. Dijkstra told me he’s been working recently on models that consider how to encourage AMOC’s recovery, including via the rapid reduction of emissions. But his team has also run experiments that consider climate geoengineering, including “putting aerosols in the stratosphere” and “closing the Bering Straight,” both of which have the potential to limit freshwater from pouring into the Atlantic. “It’s a bit science fiction, but in models you can do everything,” Dijkstra said.
UFOlogists and mainstream scientists don’t often find themselves on the same side. But while many would dismiss Strieber as an environmental conspiracy theorist, the epigraph to The Coming Global Superstorm reads as urgently and poignantly today as it did umpteen AMOC models ago: “May the children of tomorrow look back on our era as the one where the healing of the earth began.”
Talking executive orders, global conflict, and Greenland with the Center for Climate & Security’s Erin Sikorsky.
President Donald Trump signed 33 executive orders, memoranda, and proclamations after dinnertime on Monday, giving journalists, pundits, and concerned citizens plenty of material to work through after his first day in office. His Day One mandates included ordering federal workers to return to office full-time — never mind that the U.S. presidency is perhaps the most famous work-from-home job in the world — and formalizing his hatred of a two-inch-long fish. Trump also ordered an end to all wind permits, which my colleague Jael Holzman described as “the worst-case scenario” for the nearly $50 billion industry; paved the way to fire potentially thousands of civil servants; withdrew the U.S. from the Paris Agreement (again); and followed through on his promise to wage all-out war on electric vehicles.
One more of the most significant implications related to climate, however, came buried in Trump’s sweeping reversal of 78 Biden-era executive orders: the overturning of Executive Order 14008, “Tackling the Climate Crisis at Home and Abroad.” Biden had signed the executive order during his first week in office and, in doing so, declared that the U.S. “places the climate crisis at the forefront of foreign policy and national security planning.”
To fully understand the consequences of Trump rescinding this order, I spoke with Erin Sikorsky, the director of the Center for Climate & Security, a nonpartisan think tank that specializes in the intersection of climate change and national security policies. Our conversation has been lightly edited and condensed for clarity.
Last night, President Trump rescinded a Biden-era executive order designating climate change a foreign policy and national security priority. Why do you find that concerning?
Regardless of who’s in the White House, climate change continues apace — and continues to threaten U.S. national security and foreign policy interests. We just saw this in the past couple of weeks in Los Angeles with the wildfires there, which caused significant devastation to American lives and livelihoods, but also required the deployment of U.S. troops, threatened U.S. military bases, and interrupted other U.S. foreign policy objectives. President Biden had to cancel his last foreign visit to Europe, where he was supposed to meet with President Zelenskyy to talk about the war in Ukraine; he had to do the same thing during Hurricane Helene and cancel foreign visits that were about competition with China and the war in Ukraine. By sending the message that the U.S. administration is taking a step back from climate as a security issue, it creates a blind spot for the U.S. and creates risks.
When speaking to the press last night, Trump said his No. 1 foreign policy goal is keeping America safe. In your experience, how does climate change fit into that picture?
Keeping America safe means continuing to project military power and stand up to adversaries and competitors — and climate change is shaping all of that. It affects our military operations and our ability to deploy. It also affects Chinese national interests and the threat that China poses.
Our allies and partners in the Indo-Pacific, which are key to our military strategies for countering China in that region, are all threatened by climate change. Their airports, their economies, their military bases and structures, and the U.S. military facilities that are hosted in those places — they’re all threatened. If you’re not going to focus on that, or you’re not going to address it, then you’re creating a weakness. China’s overarching national security strategy includes environmental and ecological security. It is thinking about how climate affects its strategies.
In other words, our adversaries are acting on this, even if we’re not?
Exactly. And that’s the thing with stepping back from the Paris Agreement, as well: It creates a vacuum of leadership that China is more than happy to step into.
Would you expect the U.S. intelligence community or the Department of Defense to continue to act on climate change as it relates to foreign policy, just in less overt ways? Or do moves like this by the new administration hamstring those efforts?
The Department of Defense’s mission is still to be able to fight and win wars and to preserve its installations and operations. I expect that efforts to invest in resilience and adaptation will continue. There’s been bipartisan support on Capitol Hill for about a decade now to make sure that these issues are taken seriously. When Hurricane Michael decimated Tyndall Air Force Base on the Gulf Coast a few years ago, it was under the last Trump administration that they deployed money to rebuild that base. So I think that will continue.
The same will be true for the U.S. intelligence community, which remains independent from policy. It’s not the State Department, where you have to implement the president’s policies — you’re supposed to warn of risks. Your job is to give the president a decision advantage and warn of threats to the U.S., which means calling it like you see it.
Is there any particular region or conflict that could suffer from politicizing climate change in the coming years?
In Europe in the past year, Poland faced the worst floods in its history and had to deploy thousands of troops to manage those risks.
NATO has been a real leader in this space, partly because of the Arctic and the changes and challenges we see there. And so if the U.S. steps back, other leaders will continue to step forward. We’ve already seen that a bit from some European leader statements. Still, we risk U.S. resilience and dominance in the Arctic if we do not understand how climate affects our ability to operate there.
Speaking of national security in the Arctic, what do you make of the whole Greenland situation?
If the real concern is about U.S. security in the Arctic, there are a lot of other policies that the U.S. can pursue. I don’t think expanding our territory and threatening the purchase of other sovereign nations is the right way to go.