Is Your Company Losing Money Due to Climate Change? Consider Moving to the Midwest, Survey Says – Inside Weather News

The Midwest is being highlighted once again as a potential refuge from the threat of climate change, which continues to increase natural disasters around the world.

In the United States, devastating wildfires and hurricanes have caused insurance premiums to skyrocket in states like California and Florida, with some residents recently saying they are paying up to US$3,000 a month for home insurance. Rising prices and the threat of severe weather have pushed people to uproot their lives and relocate—often to the Midwest.

Now a new study from Michigan shows that businesses, once again, may be looking at America’s heartland as a place to set up shop in order to reduce the rising costs associated with global warming.

“The evidence for climate change is growing like a crescendo,” said Scott Thomsen, CEO of LuxWall, a Michigan-based window manufacturer. “We’re seeing it in our industry.”

Thomsen was one of 300 top executives interviewed in a survey published Sept. 30 by MIT Technology Review Insights and the Michigan Economic Development Corp., or MEDC. Executives, who work in 14 industries, including retail, financial services and manufacturing, all reported that their companies have been damaged to some extent by climate change. The damages include physical damage to assets, increased operating costs, higher insurance costs and disruption to their supply chains.

Three quarters of the respondents in this survey said that their companies have decided to relocate due to climate change, and a quarter said that they have already moved in part due to climate change. About 6 percent said they plan to relocate their businesses within the next five years.

About half of the survey participants also believe the Midwest is the least dangerous region when it comes to weather hazards.

Avoiding exposure to these risks is one reason LuxWall chose to call Michigan home, Thomsen said. Founded in 2016, the company considered six Midwestern states for its headquarters before settling on the city of Ypsilanti. In August, the company opened its second factory in the Michigan city of Litchfield, with another location planned for Detroit.

“We are fortunate in many ways,” said Hilary Doe, Michigan’s chief growth officer and MEDC’s chief marketing officer. “Michigan is ranked the best state for climate change when you consider drought or extreme heat, wildfires, floods — that kind of thing.”

“The evidence of climate change is growing like a crescendo. We are certainly seeing it in our industry.”

Scott Thomsen, CEO of LuxWall

Doe said that some of the “important reasons” companies end up choosing Michigan are in part because of the state’s abundant resources, its robust electrical grid and the help Michigan provides businesses with weather risk planning, including helping companies obtain weather-related benefits. Mali.

Minnesota has also seen an increase in business in recent years as companies look to expand their operations, said Catalina Valencia, executive director of business development at the Minnesota Department of Jobs and Economic Development.

The trend is more apparent when it comes to larger projects, Valencia said. While a $75 million project would have been considered significant a few years ago, he said, the state now approves a few projects each year that cost between $130 million to build, with one project costing more than $1 billion. .

Valencia noted that although companies consider climate risk when choosing to locate in Minnesota, the main factors attracting new business to the state have been the Bipartisan Infrastructure Law, the Inflation Reduction Act and other federal investments. Last year, state lawmakers passed legislation that provides state matching funds for projects that receive federal funding.

As climate change accelerates in the coming decades, Valencia and Doe expect more businesses to move to their regions. “Unfortunately,” said Valencia, Minnesota “could be one of the best places in the future, and not just now, but very much in the future.”

The Midwest is often described as a “climate zone,” in part because of its wet climate and proximity to the Great Lakes, which contain one-fifth of the world’s fresh water — a source that scientists say will become increasingly scarce. the world is warm. The Great Lakes also offer some shipping options from the U.S.

Extreme weather events cost the U.S. about $150 billion each year in damages, lost business income and lost costs, according to the Fifth National Climate Assessment, a federal report on the ways the world is affecting the world. Natural disasters causing losses of more than $1 billion now occur every three weeks on average, compared to every four months back in the 1980s, the study says.

Along the East Coast, from Florida to North Carolina, crews continued to shovel debris over the weekend following Hurricane Helene, which left 232 people dead and knocked out power to hundreds of thousands of people. Florida is now preparing for a second storm, Hurricane Milton, expected to make landfall near Tampa later this week at Category 3 strength or greater.

Helene, which made landfall in Florida as a Category 4 storm two weeks ago, has flooded six southeastern states and is the deadliest U.S. hurricane since Hurricane Katrina in 2005. Warmer ocean waters have previously helped fuel Helene, causing it to dump more water. as it was moving upwards.

Running the study, three scientists from the Lawrence Berkeley National Laboratory said Helene’s rainfall revealed the fingerprints of climate change.

“Our best guess is that climate change caused more than 50 percent of the rain during Hurricane Helene in some parts of Georgia and the Carolinas,” Michael Wehner, one of the scientists, wrote in an online statement. “We estimate that the rainfall observed in these areas has increased 20 times due to global warming.”