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STORM BREWING: Hurricane Idalia continues to intensify as it barrels toward Florida, prompting mass evacuations and threatening millions of residents with “life-threatening” storm surges, flooding, and tornadoes. But Idalia is also poised to worsen the state’s longtime property insurance crisis, driving up premiums for millions of residents and exacerbating the mass exodus of insurance providers in Florida.
As a result, many residents have been forced to adopt the state’s “insurance of last resort,” which itself has pushed for a rate increase of 12% to deal with the rising exposure.
The insurance crisis isn’t new — but it is getting worse, fast. Florida’s home insurance premiums have been rising for years, and especially in the wake of Hurricane Ian, the high-end Category 4 storm that plowed through Florida last year and caused damages of some $112 billion, the highest in state history.
According to data from the Insurance Information Institute, Florida homeowners are now shelling out an average of $6,000 for insurance policies, four times the average of other U.S. states, and major providers, including Farmers Insurance and AAA, have announced plans to end or pare down their operations in the state. At least six others went insolvent in 2022 alone. Farmers, for its part, announced it was pulling out of the state just last month.
While some residents had to give up their private insurance because they could no longer afford it — one Pinellas County woman told the Guardian she was paying more for her insurance premium than her mortgage — many others have been dropped by providers.
As a result, many residents have been driven into the arms of Citizens Property Insurance Corporation, the so-called insurance of last resort designed to protect people who are considered too high-risk to receive private coverage.
These programs are limited, high risk, and typically only cover those who can prove they’ve been denied coverage or faced a rate increase of more than 20% by their current provider. But they are also increasingly serving as a “relief valve” for states that have seen an uptick in natural disasters, including California, Louisiana, and Texas, according to the American Property Casualty Insurance Association.
Citizens is now the No. 1 property insurance provider in Florida, underscoring just how dire the home insurance crisis in the Sunshine State has become.
The heightened frequency and intensity of these extreme weather events has led to what APCIA described in a recent white paper as the “hardest market in a generation for property insurance.”
And it’s only expected to get worse. According to research from catastrophe modeling firm Karen Clark & Company, climate change is “increasing the severity but not the frequency of hurricanes,” exacerbating coastal flooding, sea level rise, and the number of hurricanes that intensify into Category 4 or Category 5 storms.
“As inland flood frequency and severity are projected to rise from tropical cyclones and heavy precipitation, this will pose a challenge for companies that insure flood, and residents who live in low-lying areas,” APCIA said of its findings.
Where things stand: Ahead of Idalia’s expected landfall tomorrow, Gov. Ron DeSantis (R-FL) declared a state of emergency in 46 counties, or nearly half of the state.
He also noted that Idalia is expected to continue to intensify quickly given the warm water temperatures in the Atlantic. “The water is warm, and there’s not going to be much to slow it down” before it makes landfall, he said at a press conference.
Forecasters warned that Idalia is an volatile and erratic hurricane that is expected to strengthen rapidly and cause significant harm to areas stretching hundreds of miles away from its center.
“Rapid intensification is likely through landfall,” National Hurricane Center specialist Eric Blake said in a statement. “Idalia is forecast to become an extremely dangerous major hurricane before landfall on Wednesday.”
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment Writers Breanne Deppisch (@breanne_dep) and Nancy Vu (@NancyVu99). Email [email protected] or [email protected] for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
GLOBAL HEALTH THREAT: Rising air pollution is now a major risk to life expectancy globally, with certain parts of Asia and Africa bearing the greatest burden but lacking the key infrastructure to address the problem, according to a new Air Quality Life Index study by the Energy Policy Institute at the University of Chicago.
The study outlines air pollution outpacing tobacco use, along with child and maternal malnutrition, as a major global threat to life expectancy. Permanently reducing fine-particle air pollution globally to meet the World Health Organization’s guidelines would add 2.3 years onto the average human life expectancy, or a combined 17.8 billion life years saved, according to the study’s analysis.
South Asia and parts of Central and West Africa are being hit particularly hard. South Asia is home to the world’s four most polluted countries — and data from the AQLI show that residents in Bangladesh, India, Nepal, and Pakistan are expected to lose about five years of life expectancy on average if the current levels of air pollution persist. The Democratic Republic of the Congo, Rwanda, Burundi, and the Republic of the Congo are among the 10 most polluted countries in the world. And now, air pollution is as much of a health threat in Central and West Africa as HIV/AIDS and malaria are.
However, despite that, both continents contribute 92.7% of years of life lost due to pollution, they lack the basic infrastructure to address the problem. Less than 10% of governments in both regions provide fully open air quality data, and just 35.6% and 4.9% of countries in Asia and Africa, respectively, have air quality standards. Read the study here.
TREASURY PUSHES FOR HUGE TAX CREDITS FOR CLEAN ENERGY COMPANIES: The Treasury Department issued a proposed rule today that would significantly boost the number of available tax credits for clean energy companies that pay their workers prevailing wages and utilize registered apprentices, as part of an effort to create good-paying jobs in the clean energy space.
According to the proposed rulemaking, companies that adhere to the prevailing wage incentives practices outlined under the Inflation Reduction Act will be eligible for up to five times the value of certain clean energy tax credits.
White House clean energy adviser John Podesta described the enhanced tax credit provisions on a call yesterday as “one of the most powerful ways that targeted investments in workers and communities have been woven into the fabric of the Inflation Reduction Act.”
“If businesses do their part to create good-paying jobs and bolster the pipeline in the clean energy industry, they’ll reap the rewards with both a strong, well-trained, dependable workforce as well as these enhanced tax credits,” he told reporters.
The proposed rulemaking is intended to give a shot in the arm to companies who adhere to the Inflation Reduction Act’s prevailing wage incentive and, in turn, drive up the number of good-paying clean energy jobs available nationwide.
It’s the first time the prevailing wage requirements, which set a minimum wage that a majority of workers on similar projects must be paid, will be applied to the clean energy sector.
But it also comes at a critical time for President Joe Biden, who has struggled to balance his goals on electric vehicles and clean energy manufacturing without also alienating his longtime union allies in the process. Read more from Breanne here.
WIND ENERGY BACKING DECLINES IN NJ: Support for wind energy has plummeted in New Jersey, with many residents tying an uptick in whale beachings to wind farms and contending that it could hurt the state’s summer tourism economy.
In a new Monmouth University poll published today, just over half of New Jersey residents (54%) favor placing electricity-generating wind farms off the state’s coast, while 40% oppose this action. This is a change from just four years ago, where wind energy support stood at a much higher 76%, with just 15% opposing this action. And prior to that, support for offshore wind farms was at a high 80-84% from 2008 to 2011.
The decline in wind energy support has been largely partisan, with Republican support dropping 41% in the last four years and independent support dropping 25%. Democratic support has remained relatively stable over the years.
“There was a time when wind energy was not really a political issue. It consistently received widespread bipartisan support for more than a decade. That is no longer the case,” Patrick Murray, director of the independent Monmouth University Polling Institute, said in a statement.
Four in 10 residents think that wind farms could hurt the state’s summer tourism economy, with nearly half of the survey takers claiming that development of offshore wind is either definitely or probably contributing to whale strandings. Plus, there are few New Jerseyans that see wind energy development as a boon for the overall state economy, with only 22% saying that the industry would create a lot of jobs for the state.
There is little concrete evidence to show that wind farms are to blame for the recent uptick in whales washing along the shores of the U.S. Experts have been pointing to ship strikes as a more likely explanation for the occurrence. Read the poll here.
MONTICELLO GETS NEW LEASE ON LIFE: The Minnesota Public Utilities Commission voted unanimously on Thursday to allow Xcel Energy to store additional spent nuclear fuel at the Monticello Nuclear Generating Plant, enabling operations to continue through at least 2040.
As Utility Dive reports, the plant’s license allows it to operate until 2030, but Xcel Energy asked the Nuclear Regulatory Commission for a two-decade extension. A decision is expected in late 2024, Utility Dive reports.
Xcel Energy in March temporarily stopped operations at Monticello to fix a second radioactive water leak, four months after an initial repair failed to fix the problem. In July, the utility said low concentrations of leaked tritium did not pose a risk to public health. More on that here.
The Rundown
Washington Post Louisiana sees ‘unprecedented’ wildfires amid record heat, drought
Bloomberg London Is Now the World’s Largest Low-Emissions Zone. Was the Fight Worth It?
