The Imperfect Science of Home Climate Risk Scores
Zillow’s climate risk scores have disappeared from home listings, but the risks themselves are very real. Modeling those threats down to the home level, though, is challenging.
Today’s newsletter looks at the struggle tobalance helpful information for buyers in a warming world with the fact that risk modeling is still in its relative infancy. Plus, how Trump’s national security strategy veers away from climate and a look at how far battery prices are expected to fall next year.
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Risky business
By Eric Roston
When Zillow Group Inc. removed climate risk scores from its home listings last month, following a complaint from the real estate industry, many observers took to the press and social media to warn — correctly — that disappearing the data doesn’t get rid of the risk.
In a country assailed by extreme weather, it’s crucial that people be able to learn about a home’s vulnerability to wildfire or flooding. But the information that’s increasingly available is not as straightforward as it might seem.
Climate risk modeling is far from perfect, a growing body of research shows, with different models often yielding different results. And it’s not always obvious to experts, let alone homebuyers, what the data represent or how they should inform decisions.
In October, a UK industry group, the Climate Financial Risk Forum, looked at how 13 different climate-risk companies each rated the same 100 properties around the world. The ratings were all over the place. Some saw a given property as highly vulnerable to flooding, for example, while others saw no risk there at all. For 20 of the properties, the study designers provided incomplete location data, to see if models could pinpoint the address. One model placed “a well-known store in Boston” on an Atlanta road with a similar name.
Risk modeling “is a relatively new discipline and it will take time for norms to emerge and become established,” the authors of the analysis wrote.
Oversimplifying climate-impact projections — or worse, getting them wrong — could lead to some people’s assets losing value for no reason, as well as distorting market pricing.
Zillow’s sitewide score removal took effect Nov. 14 and was first reported by the New York Times two weeks later. According to a spokesperson, the company acted to comply with the “varying requirements” of a major aggregator of real-estate listings.
The aggregator, California Regional Multiple Listing Service, said it found during routine auditing of real-estate portals that many houses carried very high probabilities of flooding, despite not having flooded in decades. “We grew very suspicious,” Art Carter, the listing service’s CEO, said in a statement.
“‘Climate risk’ is much more than just the physical hazard,” said Adam Pollack. “The relationship of hazard and the built environment — and damage — is the actual risk.”
Pollack, an incoming assistant professor at the University of Iowa, recently published an open-source software tool that he hopes will help researchers or companies think through uncertainties related to physical buildings.
Standardizing an approach to climate-risk data would help solve the fundamental problem: Healthy markets need trustworthy information to accurately price homes, but nobody wants to sell their house for less than they’re asking.
“What level of model output disclosure is appropriate in the public domain?” asked Oliver Wing, chief scientific and product officer at Fathom, a flood modeler that’s part of Swiss Re. “I don’t have a clear and coherent answer to that.”
What’s clearer, he said: “Greater transparency around climate risks, the general public being aware of flooding risks when they’re buying a property — I think that’s brilliant. That’s a force for good in aggregate.”
Read the full story on Bloomberg.com.
Mismatched models
The outdated 30-year mortgage
“The fundamental problem here is that you have properties that in a fixed period of time are going to have no real value because of the risk of fire or flood.”
Sheldon Whitehouse
Senator, Rhode Island
2026 battery forecast
By Mark Chediak
Battery prices are forecast to drop next year, though it’ll be a smaller dip than 2025 due to high costs of raw materials and tariffs .
The average price for a battery pack is expected to fall 3% next year to $105 per kilowatt-hour, according to a new BloombergNEF survey. The report attributes the dip to a glut of manufacturing capacity in China, increased competition and an ongoing shift to products that use lower-cost and safer lithium-iron phosphate technology.
That projected drop isn’t as large as this year’s, though: Battery prices by fell 8% to $108 per-kilowatt-hour in 2025, the report said. That decrease came despite higher battery metal prices due to supply chain risks at Chinese lithium mines and restrictions on cobalt exports from the Democratic Republic of Congo that sent prices climbing 124% between January and October.
“Cutthroat competition is making batteries cheaper every year,” said Evelina Stoikou, head of the battery technology team at BNEF. “This is an important moment for the industry, as record-low battery prices create an opportunity to lower EV costs and accelerate the deployment of grid-scale storage to support renewables integration around the world.”
Read the full story and subscribe to Bloomberg News for even more reporting on the energy transition.
Trump’s war on net zero
By Lili Pike
The Trump administration’s new national security plan mentioned “climate change” only once—and dismissed it. “We reject the disastrous ‘climate change’ and ‘Net Zero’ ideologies that have so greatly harmed Europe, threaten the United States, and subsidize our adversaries,” the document states while calling for the US to pursue “energy dominance” instead.
Some Trump administration cabinet members, including Defense Secretary Pete Hegseth, have used similar language to describe climate change. Now, that message is encoded in a key document.
The national security strategy, typically published early in a new presidency, sets the agenda for foreign policy across government agencies. Trump’s plan is a departure from former President Joe Biden’s 2022 National Security Strategy, which identified climate change as the world’s greatest shared challenge, stating warming is at “the very core of national and international security and must be treated as such.”
The Biden administration deployed a slew of tariffs and industrial policies in a bid to revive domestic green industries to lower emissions and compete with China, its other core national security challenge. Trump’s new plan still identifies China as a priority, and the “subsidize our adversaries” line appears to be a reference to Beijing, which dominates green tech.
The White House didn’t immediately respond to a request for comment.
The administration has dismantled the policies Biden put in place to help the US catch up to China. Instead, Trump aims to use the US’s ample fossil fuel resources to gain global leverage. In recent months, Trump officials have scuttled an international deal to cut emissions from shipping and pushed US fossil fuel exports at trade talks.
There’s a risk that hostility toward cutting emissions could hurt Trump’s other national security priorities, though. The administration’s attacks on renewables risk undercutting the country’s ability to meet rapidly rising data center energy demand — and therefore compete with China on AI. Trump’s new plan also calls for “resilient national infrastructure that can withstand natural disasters” — many of which are being worsened by burning fossil fuels — even as the administration is considering dismantling FEMA.
Subscribe to Green Daily for free to get more exclusive content on the Trump administration’s approach to climate risks.
This week’s Zero listen
In his new book Breakneck, tech analyst Dan Wang argues China’s engineering mindset has given it an edge in all sorts of domains, including climate technologies, while America’s lawyerly mindset is holding it back. This week on Zero, Wang tells Akshat Rathi what the world can learn from China and how the US could start to compete on green tech in the future.
Listen now, and subscribe on Apple, Spotify or YouTube to get new episodes of Zero every Thursday.
More from Green
Asian and Norwegian shipping dynasties are among investors offering support for modern-day sail technology that claims to have potential to slash the amount of fuel needed by vessels.
The family office of Norway-based shipping group Odfjell SE and Singapore-based Octave Capital, backed by storied conglomerate Tsao Pao Chee Group, supported a new $44 million fundraising round for bound4blue, a developer of wind propulsion systems, the company said on Tuesday.
Spain-based bound4blue’s technology — tube-like structures up to 36 meters (118 feet) high — suck in wind during a vessel’s journey and use fans to create thrust, reducing emissions and cutting fuel consumption by as much as 40%, according to the firm. Maersk Tankers A/S and Eastern Pacific Shipping Pte. are among the developer’s customers, with the technology so far deployed on seven ships.
The fundraising, which also won backing from investors including ReOcean Fund, co-managed by the Prince Albert II of Monaco Foundation and Monaco Asset Management, will support plans to extend manufacturing capacity from Spain to China and other parts of Asia.
Read the full story on Bloomberg.com
Energy Impact Partners, an investment firm that recently closed a new fund of nearly $1.4 billion, is looking to buy out struggling companies working on the energy transition.
The EU reached a tentative deal to slash ESG requirements, as the bloc faces intensifying pressure from the US to rein in such rules.
This year is on track to be the second-warmest on record, tied with 2023, according to data from the EU’s Copernicus agency.