The past year has been characterized by very visible climate impacts — record-breaking heat, floods, and other natural disasters. An ongoing megadrought led to increasingly pressing concerns over the future of water security in the American West. Hurricanes pummeled Puerto Rico, Florida, and much of the Eastern seaboard. And cities and towns in between experienced searing heat, torrential floods, and epic snowfall. Despite the obvious signs of planetary peril, the industrialized world continues to fall short of the emissions goals outlined in the Paris Agreement. 

But through it all, some hard-earned victories have given climate advocates reasons to be hopeful. In August, the United States passed its most meaningful piece of climate legislation ever with the Inflation Reduction Act, a win that caught many by surprise after months of gridlock. The law will make roughly $369 billion available for cutting emissions and protecting frontline communities. Last month, negotiators at COP27 worked through challenging conditions to forge a historic agreement to establish a fund for loss and damage — a critical step toward global climate justice. And on smaller stages everywhere, businesses, organizations, and individuals are advancing their own solutions, from increasingly widespread technologies like heat pumps to nature-based initiatives like wetland restoration

We took a look back at some of the biggest climate stories from the past year and asked 23 experts to forecast what 2023 holds in a few key areas: water, ecosystems, politics and policy, mitigation and adaptation, technology, and business. Their predictions provide a glimpse of what progress could look like in the months ahead, and a rubric for measuring success. (Comments have been edited for length and clarity.)


Close-up of dry, cracked lake bed
Drought-stricken Lake Mead in Boulder City, Nevada, provides electricity to several parts of Arizona, California, and Nevada and is also a source of water across the southwest. Frederic J. Brown / AFP / Getty Images

Water

A critical juncture for water security

Almost 47 percent of the U.S. including Puerto Rico remain parched by the worst drought in 1,200 years, a crisis impacting 196 million people. It is particularly acute in the seven western states that rely on the Colorado River for much of their water. The region’s continued growth and the drier, hotter conditions of a warming world have so imperiled the river that lakes Mead and Powell — two of the nation’s largest reservoirs — reached record lows in 2022. Federal officials have told those states to reduce water usage by as much as 4 million acre-feet per year, or face mandatory cutbacks. The steps they take in 2023 could radically shape the lives of more than 40 million people throughout the west, impact 5 million acres of agricultural land, and influence water policy nationwide.

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  • Western states must find common ground managing the Colorado River

    Western states must find common ground managing the Colorado River

    Sarah Porter, director of the Kyl Center for Water Policy at Arizona State University


    We’ve been working on the Colorado River system for a long time, and so far, the measures we’ve taken haven’t been successful. I think a lot of people feel we need to stop living on the edge. We’re finally facing up to the prospect of no hydropower production, or dead pool, and that could be catastrophic.

    In 2023, we [must] figure out a way to save at least 2 million acre-feet of water in the system. That has to be a multiyear commitment to allow the reservoirs to recover. If that doesn’t happen, we could be in a situation where we’re really staring in the face of dead pool in 2024. The only thing we have control over in this situation is how much water we take out of the system. We can’t control how much water goes in. We need to make this commitment to leave a lot of water [in the basin] over multiple years to enable it to recover.

    I’m hopeful that the region will come to an agreement. Honest reckoning with where we are is motivating. It’s one of the most challenging water-policy scenarios that the Western U.S. has ever faced — arguably, the biggest challenge that the U.S. has ever faced.

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    Photo courtesy of Sarah Porter

  • Nature-based solutions and Indigenous input will make 2023 a turning point

    Nature-based solutions and Indigenous input will make 2023 a turning point

    Felicia Marcus, attorney, founding member of Water Policy Group, and visiting fellow at Stanford University’s Water in the West program


    We’re facing an eminently predictable “hitting of the wall” with the Colorado River, followed closely by the Sierras [where dwindling snowpack provides less water]. We’re going to see communities and hundreds of thousands of acres of farmland running out of water — 2023 will force us to make hard structural decisions that have been put off for decades. 

    [The solution] starts with conservation, recycling, and stormwater capture and recharge. Nature-based solutions, from the top of the watershed to the bottom, is something we’ve been talking about in the environmental community for 40 years. But now it’s finally starting to take off with real money. Nature-based solutions, including the Klamath River dams coming down, can help with biodiversity and water. [These] will be the biggest restoration and redemption moves in the country, not only for ecosystems but for the relationship between tribes and the federal government. This is the year we are going to look back at as a turning point in our relationships with nature and each other.

    Photo: Vice Media

    This prediction has been updated for clarity.

  • Data-driven technology will shape how we use water

    Data-driven technology will shape how we use water

    Newsha Ajami, hydrologist and chief development officer for research at Lawrence Berkeley National Laboratory’s Earth and Environmental Sciences Area


    All signs point to the coming year being another very dry year. I anticipate that leading to significant changes in how we manage water and think about outdoor water use in the Western U.S. I expect more communities to embrace native landscapes versus all of this grass, and I think we’re going to start embracing a lot of new technologies. I see more data-driven technology improving [utility] systems, from identifying leaky pipes to operations efficiency to water-use patterns, and more. A lot of things can be done with AI and this data.

    Our hydrological patterns are changing. It’s generally the same amount of water, but in different forms: less snow, more rain, and more intense events, rather than gradual precipitation. We need to think about how and if our infrastructure is suited to handle all that change. Instead of borrowing from the past, continuing to build the same things over and over and expecting a different outcome, we need to consider what kinds of solutions to put in place to help us build water security and manage our water in a different way. 

    Photo: Stanford University


Fall-colored trees growing within a burn scar from a forest fire
Aspen trees grow in a burn scar from a forest fire in Utah’s Wasatch Mountains. Jon G. Fuller / VW Pics / Universal Images Group / Getty Images

Ecosystems

The next wave of conservation

Marine, forest, and wetland ecosystems sequester vast quantities of carbon dioxide and provide an essential defense against the impacts of climate change. In 2022, the Inflation Reduction Act marked a major recognition of the government’s role in protecting and managing these imperiled spaces. It allocates roughly $22 billion to, among other things, conserve wetlands, restore coastal habitats, preserve old-growth forests, and reduce fire risks for communities in forested regions.

Much of the IRA is focused on technological solutions to the climate crisis. But the legislation, along with other funding streams and programs, also recognizes an essential truth: Nature is a profound ally in the fight against climate change, and by saving it, we save ourselves. 

  • 2023 will bring more environmental threats — and more money for solutions

    2023 will bring more environmental threats — and more money for solutions

    Tarik Benmarhnia, environmental epidemiologist at Scripps Institute of Oceanography


    In California, there’s a change in precipitation regime — more rain, but at the same time, more drought. That’s the worst of each, because you have a lot of accumulation of contaminants on the landscape that run off into the ocean and into a lot of water systems and erode the coastlines.

    This concept of compounded impacts, being exposed to more threats at the same time, is going to become more and more problematic. But [in 2022], we already saw a big change in terms of funding for climate and specific initiatives focusing on vulnerable communities, and I expect next year to be even more explicit. Five years ago, funding innovative solutions to climate change, vulnerable communities, and partnerships wasn’t happening at all. Right now is a really good time, funding-wise. In the upcoming year, we’ll need to provide the evidence to create as-specific-as-possible policies that can help the most vulnerable communities. 

    I think we will move toward designing and implementing adaptation strategies and solutions immediately, rather than being in this moment where we know things are going wrong if we don’t do anything — and I see that taking up way more room in the future political agenda. 

    Photo courtesy of Tarik Benmarhnia

  • Wetlands (finally) get the attention they deserve

    Wetlands (finally) get the attention they deserve

    Eric W. Sanderson, senior ecologist at Wildlife Conservation Society


    In 2023, and in the year after that and the year after that, wetlands are going to keep getting wetter [due to floods and storm surges], even in places that don’t look like they’re wetlands now. The United States has lost lots of its wetlands, particularly in coastal cities. Those are the places that are increasingly subject to storm surge and coastal flooding, in large part caused by climate change. 

    We’re at a turning point in our consciousness about this. For a long time, we talked about marshes and swamps as things we don’t want. People have come to realize the many benefits these wetlands provide, number one of which is flood protection. Almost all of our carbon is stored in wetlands. Society is finally realizing that these places aren’t to be drained. 

    In 2023, I’ll be looking at the historical geography of New York City’s five boroughs. Every street, every pond, all of the Lenape sites, where the shoreline was, how deep it was under the water. The more we can reveal the nature of this landscape, the more we’ll be able to ensure our long-term sustainability and resilience. American society is finally realizing that it’s not about people dominating nature, but living with nature for the future of our planet.

    Photo: Han-Yu Hung

  • Reforestation will uplift frontline communities

    Reforestation will uplift frontline communities

    Michael French, forester and director of operations at Green Forests Work


    In the past 20 years, we’ve lost about a billion acres of forest, which is about half of the continental United States. We need to increase the momentum and scale of tree planting across the nation. We need people who have the skill to go out there and who know which tree belongs in which area. 

    There have been a lot of really good things passed into legislation recently: the Inflation Reduction Act, the bipartisan infrastructure law, and the REPLANT Act. The U.S. Forest Service received quite a bit of funding for urban reforestation, which is crucial as well. The federal government is going to play a huge role in the upcoming year. In the face of all of these catastrophic fires we’ve been seeing in California and Oregon and Washington, I imagine that a lot of it will go out West. 

    If you look at Appalachia, ecological restoration is just one of the reasons reforestation is important. Others are economic development, environmental education, and creating employment opportunities throughout a frontline region. We’ve all benefited from the coal and steel that’s gone into building our cities, and we need to give back to those regions. In the face of climate change, that is more crucial than ever. 

    Photo: Green Forests Work


A cloud rises behind the U.S. Capitol dome
The U.S. Capitol building in August, when temperatures in Washington, D.C. neared 100 degrees as heat domes in the Pacific Northwest and the East put 150 million Americans under alert. Chip Somodevilla / Getty Images

Politics & Policy

Political momentum for climate and climate justice

Climate policy got off to a rough start in 2022. By July, President Biden’s plan to cut greenhouse gas emissions was faltering, and the Supreme Court had limited the government’s ability to regulate that pollution. Yet political will to address the crisis proved remarkably resilient. The Inflation Reduction Act squeezed through Congress. The predicted “red wave” in the midterm elections didn’t materialize, and eco-friendly governors and state legislators won key races, with roughly half of all voters calling climate change a top concern in one pre-election poll.

Meanwhile, the Biden administration has delivered some wins for environmental justice, with initiatives like a new EPA office dedicated to that goal and a promise to allocate at least 40 percent of federal climate investments to historically disadvantaged communities.  

The coming year will show whether action can match up to promises. Congress and the courts could stymie further progress, or even throw a lasso around gains already made. And the Inflation Reduction Act, a historic victory for climate mobilization, will present challenges — as well as opportunities — in its implementation.

  • A new EPA office could mean additional protections for vulnerable communities

    A new EPA office could mean additional protections for vulnerable communities

    Catherine Coleman Flowers, founder of the Center for Rural Enterprise and Environmental Justice; vice chair of the White House EJ Advisory Council


    I was in Warren County, North Carolina, at the 40th anniversary of the launch of the EJ movement, where the announcement was made about the Office of Environmental Justice and External Civil Rights being launched at the EPA. I thought that that was a significant development — especially having just come back from visiting the [Houston neighborhood] of Manchester and seeing how people are grappling every day with the possibility of death from disease or exposure to contaminated air. It’s frightening. Out of this [new] office, I hope to see more actions to protect communities like Manchester. 

    Environmental justice is at the center of everything the federal government is doing now. That has never happened before. I think, over the next couple of years, the challenge is going to be: How do we build resilience in all communities?

    One of the biggest developments [for my work] in 2022 was the visit to Lowndes County [in Alabama] in March by the EPA administrator. This is the first time the EPA and USDA have worked together on trying to solve the sanitation issues in rural communities. Out of this we can hopefully see some long-term policy that could ultimately lead to water and sanitation becoming a human right.

    Photo: MCarson Photography

    Correction: An earlier version of this post incorrectly stated the location of Lowndes County.

  • The midterm results will drive progress at the state and local levels

    The midterm results will drive progress at the state and local levels

    Leah Stokes, political scientist and professor of environmental politics at the University of California, Santa Barbara


    We now have people in place who understand the urgency of the climate crisis, and we need to use the opportunities that we have. The midterm elections made serious progress at the state and local levels by bringing new Democratic trifectas to several states. There’s a great opportunity to keep making [climate] progress in the places we have, like California and New York, and start making progress in places like Massachusetts, Maryland, Michigan, and Minnesota. That will accelerate the Inflation Reduction Act’s impacts. 

    The IRA is already making a really big difference and the industrial piece of it is going to be transformative, as far as creating good-paying clean-energy jobs as well as making policy real for communities. We need to make sure that the policies help disadvantaged communities and that the dollars flow out the door quickly and equitably.  

    It’s clear that we’re at an inflection point in the fight for a fossil fuel-free future. You see just how expensive and dirty fossil fuels are, and it’s clear that Americans would rather get an electric vehicle, which is cleaner and less expensive than a gas-powered car — so the demand is there, and I think it’s going to create a virtuous cycle.  

    Photo: Elaisha Stokes

  • Bipartisanship and pragmatism will shape climate policies

    Bipartisanship and pragmatism will shape climate policies

    Quill Robinson, vice president of governmental affairs at American Conservation Coalition


    For the first time, we are really looking at a political dynamic where both parties bought into this idea that climate change is a serious issue facing the U.S., and there needs to be competition over which policy ideas are the best ones to address it. An area that would be fertile in a divided Congress and Republican-led House is natural climate solutions, and these types of policies also get the most agreement on both sides of the aisle.

    Russia’s invasion of Ukraine made a lot of people realize that climate change is not the number one issue for every national leader or for every citizen around the world. There’s going to be things that are prioritized higher than this longer-term, slower-moving, very serious issue of climate change. There was a realization in the climate space that the whole world can’t just hold hands and tackle this all together — policy cannot sacrifice the security or economy of a nation. If we’re going to see the world as it is, rather than the way that we’d like it to be, we need to make sure that it’s the U.S. and other nations that believe in democracy, human rights, and freedom that are promoting clean energy technologies.

    Photo: Kaleigh Cunningham / Adventure Forever Photography

  • Activists will pressure the U.S. to ‘walk the talk’ after COP27

    Activists will pressure the U.S. to ‘walk the talk’ after COP27

    Adrien Salazar, policy director at Grassroots Global Justice Alliance


    We are seeing the growing acknowledgement of the reality that the climate crisis is a crisis of inequality. You cannot address the carbon molecules in the atmosphere without also addressing histories of colonialism and racism that allow the impact of the climate crisis to be born unequally across the world and within the U.S. Our work in the next year is going to be holding the Biden administration accountable to the leadership that it is trying to posture in the international arena.

    When we came back [from COP27], the Biden administration approved the Sea Port Oil Terminal off the coast of Texas. It’s really a contradiction to see the U.S. talking about fossil fuel phaseout on the international level, and then continuing to approve oil and gas projects domestically. And so it’s going to be up to us as movements fighting for climate justice to hold their feet to the fire and get them to follow through on their position. I think this is where we are really going to put pressure on the administration to walk the talk.

    Photo courtesy of Adrien Salazar

  • SCOTUS will complicate, but not thwart, national EJ initiatives

    SCOTUS will complicate, but not thwart, national EJ initiatives

    Emily Hammond, energy and environmental law professor at George Washington University Law School


    If the Supreme Court chills efforts to directly consider race when implementing environmental justice reforms, those reforms might be harder to achieve — but in the coming year, we should watch for people working creatively to do just that.

    We’re seeing a lot of efforts in anticipation of the Supreme Court’s expected rulings [on race-conscious college admissions] already. When the Council for Environmental Quality put out its environmental justice mapping tool earlier this year, it didn’t include race among the various data sets. Next year, the momentum behind both federal and state initiatives for environmental justice is going to continue — but it’s going to look as though it’s carried out by governments that are worried about these upcoming opinions and rulings. [We’ll see] them nervously moving forward on environmental justice initiatives in ways that will not face legal challenges.

    So it’s not that the work will stop. In fact, I think we’re seeing increasing commitment to that work across many areas of our country and certainly in the federal government. And we still have at least two years of this administration to really see that work come to fruition. That’s exciting, but we’re going to have to really examine the way policies for environmental justice are being shaped and written to evaluate if they’re actually going to create the effects they’re aiming to.

    Photo courtesy of The George Washington University


A pink Florida home, with palm trees in its front yard, flooded with water
A house flooded by water due to Hurricane Ian in Key Largo, Florida. Daniel A. Varela / Miami Herald / Tribune News Service / Getty Images

Mitigation & Adaptation

Reactions to a year of climate disasters

Climate change has, for years, been making fires bigger, heat waves hotter, and hurricanes stronger. But even by that measure, 2022 was extreme. 

Appalachia and the region around Yellowstone National Park saw record-breaking floods. More than 104 million people nationwide suffered from dangerous heat on a single day in July alone. Nearly 70,000 wildfires scorched over 7 million acres, predominantly in the American West — the largest number of fires in the past decade. Hurricanes Fiona and Ian barreled into Puerto Rico and Florida, killing at least 150 people and causing billions in damage.

Such events were, in the words of one expert we spoke to, an eye-opener for many — but shouldn’t have been. Ninety percent of U.S. counties have experienced a weather disaster of some kind in the past decade. In 2023, the ways in which we address, prepare for, and respond to such extreme weather events will not only impact our climate future, but will shape our very existence on earth.

  • People will hold governments accountable

    People will hold governments accountable

    Njoki Mwarumba, assistant professor of emergency management and disaster preparedness at the University of Nebraska


    The catastrophic flooding in KwaZulu-Natal, South Africa, has implications for 2023 in the way in which the community reacted. In a fearless and very daring move, a civil-society organization took the president and members of parliament to court, accusing them of being culpable for homicide by ignoring climate action. To imagine that someone can do that anywhere, let alone on a continent where there’s so much supposed vulnerability, is an indicator for the inherent strength and social capital and legal frameworks that can be leveraged. The threats on lives for doing that are very real. Taking a president to court for something like that is not an easy thing, but it’s a metric of where people are at when it comes to inactivity. 

    People are exhausted with so much talk, and the ones on the ground are now able to say, “Enough is enough, we’re going to take matters into our own hands.” In 2023, different countries are going to continue to send out this flare of very tangible and actionable hope. It’s about climate governance — we need good governance that is consistent and more responsive to what science is telling us.

    Photo courtesy of Njoki Mwarumba

  • Communities will drive a bottom-up transformation in renewables

    Communities will drive a bottom-up transformation in renewables

    Arturo Massol-Deyá, executive director of Casa Pueblo


    In Puerto Rico, we’ve seen that it’s not the storm but the aftermath that is the problem. Without power, it’s very difficult to rebound and regain some sense of normalcy. Education gets interrupted, water isn’t available, those needing medical attention aren’t able to get it. We have already suffered a lot from Hurricane Maria, earthquakes, the pandemic, and now Fiona. If you add up all of those compromises for education and medical attention, and so on, it’s a huge burden upon society. So we’re going to keep pushing for self-sufficiency in energy generation at the point of consumption, to break the dependency on fossil fuels and the centralized grid. 

    Individual communities are the driving force for a bottom-up transformation of renewable energy. The government [of Puerto Rico] hasn’t done anything in the last 10 years to improve this generation’s clean energy sources, everything is still pretty much the same. We’re already seeing 6 percent or more of total residential consumption being produced by solar power. It might not sound huge, but it is. It’s not enough yet, but it’s showing the path. 

    Photo: María Mari-Narvaez

  • We need to be open to the possibility of relocation

    We need to be open to the possibility of relocation

    Auroop R. Ganguly, professor of civil and environmental engineering at Northeastern University


    Events in 2022 shouldn’t have been, but still were, an eye-opener. It was a “predictive surprise.” Hurricane Ian, the floods in Tennessee and Kentucky, the wildfires — things have progressively gotten worse. If we are rebuilding, what [building] codes do we follow? Usually as civil engineers, we follow a very prescriptive code. But what we’re seeing more and more is that these codes are getting very hard to anticipate. We have to create new codes and design for worst-case scenarios, which is hard, but we have to. 

    We are reaching a stage where we need to be open to the possibility of relocation. It doesn’t sit well with anybody, so it needs to be done through financial incentives and through understanding and awareness in a voluntary way. And we need to make sure this relocation is equitable, so that there is no forceful gentrification of people who cannot afford to move. 

    Photo: News@Northeastern

  • We must make bold moves towards resilience

    We must make bold moves towards resilience

    Maxwell Alejandro Frost, representative-elect for Florida’s 10th congressional district and the first member of Gen Z elected to Congress


    The role of Gen Z has been to really raise the stakes and try to shake people and tell them the climate crisis is happening. We need to deal with it now. We are the ones that are going to be paying the bill on this, and when we do take power completely, we will handle this. But the more we wait, the ability to handle it shrinks. And the bill continues to grow. 

    What’s top of mind for me is the correlation between all of these natural disasters and what we’re doing as humans to exacerbate the problem. In Florida, we just had two major hurricanes that completely wiped out some of our communities. It put a spotlight on the fact that there are so many communities that did not have the resources they needed to be resilient. 

    Resiliency and infrastructure are top priorities for me. In my district in Central Florida, flooding is our biggest problem. We have to make sure that homes are more resilient to flooding and manage the flow of water. These hurricanes are becoming stronger and lasting longer. The cost of not doing anything is far greater than the cost of making bold moves right now.

    Photo: Craig Barritt / Getty Images


A driver, illuminated by the green, glowing charging station, charges their electric vehicle
An electric vehicle charging station in California, which in August adopted rules banning the sale of new gas-powered cars by 2035. Frederic J. Brown / AFP / Getty Images

Technology

New voices and spending in clean energy

The windfall provided by the Inflation Reduction Act is designed to encourage more institutions and individuals to participate in the transition to clean energy. It should help car manufacturers establish a domestic electric vehicle supply chain, and make it easier for families to buy EVs — accelerating an already growing market for EVs. It will offer tax credits for solar and offshore wind projects, and incentives to help households electrify their appliances. In 2023, the impact of these new funds will start to become clear. But without circular pathways for the materials needed to ensure widespread electrification, these technologies won’t go far in mitigating our climate impact. 

  • The IRA will supercharge a circular, domestic EV supply chain

    The IRA will supercharge a circular, domestic EV supply chain

    Alexis Georgeson, vice president of government relations and communications at Redwood Materials


    The Inflation Reduction Act is a complete game-changer for incentivizing the onshoring of the battery supply chain. The greatest vulnerability to electrification is a supply chain that is predominantly dependent on Asia for the most costly and important parts of an electric vehicle. It’s a 50,000-mile journey from mining through refining through component manufacturing. It creates geopolitical risks as well as costs, and the CO₂ affiliated with that logistics network is tremendous. 

    The IRA completely changes this paradigm. We’re now going to onshore the most technical and important components of batteries, which creates high-paying jobs and helps capture what amounts to several hundred billion dollars of economic value in the next decade that was otherwise earmarked to be spent overseas.

    I think we’ll see more battery-cell manufacturing, but also more of the upstream-component anode and cathode manufacturing here in the U.S., which is critically important to being able to meet the administration’s goals of 50 percent EV sales by 2030.

    Photo: Redwood Materials

  • Tribes will lead the next phase of the EV transition

    Tribes will lead the next phase of the EV transition

    Robert Blake, executive director of Native Sun Community Power Development


    We got started on the Upper Midwest Inter-tribal EV Charging Community Network about four months ago. We’ll be ordering about 20 electric vehicles to bring into tribal communities and spacing charging stations throughout Minnesota, North Dakota, and South Dakota on tribal reservations. We’ve been encouraged to expand the network into Wisconsin and Michigan.

    This is an opportunity for the tribes to take ownership of the EV transition. They’ll be learning the operation and maintenance of these vehicles, and learning how to install charging stations. 

    EVs are where I really see the future heading for rural communities and tribal nations. There’s going to be a huge used-EV market soon. That’s where a lot of these communities are going to get their introduction to this space. Let’s face it, $6 a gallon when you have to drive 50 miles to get to the grocery store — that starts to add up.

    We really did this project in the beginning because we wanted to show Native peoples’ resistance to fossil fuel infrastructure. You guys are going to build oil pipelines. We’re building electric vehicle charging network pipelines. Let’s see what the market does. 

    Photo: Joe Parkhurst

  • American homes will electrify faster than ever

    American homes will electrify faster than ever

    Sam Calisch, head of special projects at Rewiring America


    The Inflation Reduction Act will provide the average American household an “electric bank account” of $10,600 in incentives to electrify. This includes a first-of-its-kind electrification-rebate program with $4.5 billion to help low- and moderate-income households purchase heat pumps, induction stoves, and other electric appliances. 

    This is going to be the year of rolling out these consumer incentives to American households. When older appliances break down, now the cheapest option will be for them to get an electric heat pump or an electric-heat-pump water heater. That’s a huge step from where we were before. 

    I think it’s going to supercharge deployment. We’re going to start seeing heat pumps on our blocks. Your neighbor is going to have one, and tell you how great it is. 

    Not only does [electrification] have big climate impacts, it improves quality of life. An average household would save about $1,800 a year by electrifying, plus [get] all the accompanying health benefits of not burning fossil fuels in our homes. These benefits are going to change people’s hearts and minds about the role they can play to help solve climate change. 

    Photo courtesy of Sam Calisch

  • The mining required for clean energy will create new EJ battles

    The mining required for clean energy will create new EJ battles

    Jade Begay, climate justice campaign director at NDN Collective


    A lot of the focus on the IRA and getting it passed is going to morph into a real fight from Indigenous and frontline communities around how we are going to make this massive transition to clean energy happen. We’re going to need to mine a lot of critical minerals. And those minerals are in Indigenous territories — in the U.S., but also in Africa, in South America. 

    We see the White House putting out commitments and proclamations around how they want to integrate Indigenous knowledge into decision-making. But how do we protect Indigenous knowledge when there are mines being fast-tracked for the sake of energy security? 

    One of the things I’m not seeing us talk about in a brave and sensitive way is that we are using too much energy — as nations, as cities, as families. We don’t have enough resources in the world to be using energy the way that we’ve gotten so used to on fossil fuels. 

    In the coming year, we’re going to have to really grapple with the mining issue. I don’t see any other way of working through this dilemma without questioning how we shift the ways we consume energy so that we don’t need to extract every last mineral from this earth. 

    Photo: Cara Romero


Three-tiered conveyor system full of hanging clothes inside a ThredUp facility
A three-tiered conveyor system at the ThredUp sorting facility. ThredUp is an online consignment store that has been part of a rise in resale shopping. Matt York / AP

Business

Business models that prioritize sustainability

In a capitalistic economy, profitability and sustainability often seem at odds. But when a billion-dollar company decides to give away all its profits, or a venture-capital firm invests millions in circular businesses, it begins to feel like that might finally be changing. 

This year, retail businesses explored ways of generating revenue without extracting new resources, a key principle of a circular economy. Investors demanded more meaningful signs of good ESG, ones that went beyond how well companies protected themselves from climate risk to examine their own impact on climate and communities. Such practices have, in the past, been relegated to companies and investors known to prioritize sustainability, but others are now showing that there is money to be made in sustainable, circular, and equitable businesses.

As 2022 ends with some of the biggest Wall Street firms backpedaling on their climate commitments, 2023 is poised to demonstrate whether there is building momentum, as well as consumer demand, for change.

  • Underrepresented founders will get the funding they deserve

    Underrepresented founders will get the funding they deserve

    Destana Herring, associate at Regeneration.VC


    During the pandemic, social justice movements called for impact investors to act. In 2022, the Inflation Reduction Act signaled massive investments in climate technology. Next year, these two causes are poised to join forces through intersectional environmentalism. It’s going to take representation at the investment-manager level as well as at the [startup] founder level, but we can bring into the conversation how different communities feel and are affected.

    In 2023, I’ll be looking for early climate investment opportunities led by diverse founders. We see incredible underrepresented talent emerging — some from the most climate-affected communities worldwide — but the businesses disproportionately fall short of our Seed/Series A investment stages.  

    At Regeneration.VC, over 50 percent of our portfolio companies have underrepresented founders, in contrast to the industry average of below 10 percent. 

    I’m eager to support brilliant founders who need early partners to close funding gaps and achieve milestones. By uplifting marginalized communities, these founders will play essential roles in regenerating our planet. 

    Photo: Carlos Eric Lopez

  • Brands will find new ways to generate revenue from their used products

    Brands will find new ways to generate revenue from their used products

    Nellie Cohen, director of circular business models at sustainability consultancy Anthesis


    The adoption of resale programs in retail was just insane this year, which is great. But brands are saying they’re not expecting resale to generate revenue. The problem with that is it keeps sustainability as a sideshow. It doesn’t transform us into a circular economic system. 

    Brands will quickly realize that they need a multipronged strategy for circularity. The same ways we sell new stuff — we sell it direct to consumers, we sell it in retail stores, we sell it through wholesalers — we’re going to have to have for circular. There will be resale. There will be leasing and rental. There will be eco-friendly subscription models where customers can rent clothes seasonally.

    What I hope to see in 2023 is the acknowledgement that we have to move from supplementing a linear economy to replacing a linear economy. Brands have to displace the production of new things with the sale of used things in order for the circular economy to achieve its sustainability aspirations.

    Photo: Tim Davis

  • Investors will zoom in on climate and impact

    Investors will zoom in on climate and impact

    Alyssa Stankiewicz, associate director of sustainability research at Morningstar


    The industry has become clearer over the past year on the difference between ESG risk and sustainable impact. 

    From the perspective of financial resilience, investors need to consider the effects of climate change on their portfolios. But sustainability-focused investors are looking beyond that in 2023. They’re looking for solutions-focused, impact-oriented versions of sustainable strategies. They’re prioritizing companies that not only manage their own internal risk, but that also look for ways to drive the renewable energy transition, or that go out of their way to better engage with their stakeholders. 

    The focus is also turning to the role of emerging markets in the energy transition — that emerging markets are disproportionately exposed to climate risks such as flooding, drought, and wildfires is becoming clearer. But investors are also increasingly aware of the need for the climate transition to be inclusive of all peoples and regions.

    For instance, many of the materials that are needed for the renewable energy transition are mined in countries with poor labor laws. It can’t just be that developed markets gain exclusive access to these materials and forget the entire Global South. As data improves, investors are scrutinizing the extensive supply chains associated with the products and services they invest in.

    Photo: Matthew Gilson

  • Companies will need to show they are taking the climate crisis seriously

    Companies will need to show they are taking the climate crisis seriously

    Corley Kenna, head of communications and policy at Patagonia


    Patagonia is now owned by the Patagonia Purpose Trust, which locks in the company’s purpose and values, and a new nonprofit called the Holdfast Collective, which takes all money that’s not being reinvested into the business and uses it to fight the climate and ecological crises. To our knowledge, this has never been done before. 

    I think we did ignite a global conversation about the future of business, and we hope to see evidence that more companies are taking the climate crisis seriously. That doesn’t mean that they need to give away all of their profits, but it does mean they can’t just run a marketing campaign saying that they’re doing all kinds of things to address the climate crisis, but then the next day not advocate for climate policies.

    Another thing to look at next year is who is at the table when big corporate decisions are being made. Are scientists at the table? Are frontline communities at the table? If they are, that’s a good indication that we’re moving in the right direction.

    We always get asked, “Are growth and profitability inherently in conflict with this crisis?” The answer is yes. We don’t have all the answers. But let’s acknowledge that we can’t just grow recklessly as businesses. There’s a need for capitalism to evolve. 

    Photo: Tim Davis

PROJECT CREDITS

Reporting by Gabriela Aoun Anguilera, Avery Schuyler Nunn, Claire Elise Thompson. Editing by Jaime Buerger, Chuck Squatriglia. Art direction by Mia Torres.