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This story was originally published by Grist. Sign up for Grist's weekly newsletter here.

On a 20-acre parcel outside the tiny Southern California town of New Cuyama, a 1.5-megawatt solar farm uses the sun’s rays to slowly charge nearly 600 batteries in nearby cabinets. At night, when energy demand rises, that electricity is sent to the grid to power homes with clean energy. 

To make renewable energy from intermittent sources like solar and wind available when it is most needed, it’s becoming more common to use batteries to store the power as it’s generated and transmit it later. But one thing about the Cuyama facility, which began operations this week, is less common: The batteries sending energy to the grid once powered electric vehicles.

The SEPV Cuyama facility, located about two hours northeast of Santa Barbara, is the second hybrid storage facility opened by B2U Storage Solutions. Its first facility, just outside Los Angeles, uses 1,300 retired batteries from Honda Clarity and Nissan Leaf EVs to store 28 megawatt-hours of power, enough to power about 9,500 homes.

The facilities are meant to prove the feasibility of giving EV batteries a second life as stationary storage before they are recycled. Doing so could increase the sustainability of the technology’s supply chain and reduce the need to mine critical minerals, while providing a cheaper way of building out grid-scale storage. 

“This is what’s needed at massive scale,” said Freeman Hall, CEO of the Los Angeles-based large-scale storage system company.

Electric vehicle batteries are typically replaced when they reach 70 to 80 percent of their capacity, largely because the range they provide at that point begins to dwindle. Almost all of the critical materials inside them, including lithium, nickel, and cobalt, are reusable. A growing domestic recycling industry, supported by billions of dollars in loans from the Energy Department and incentives in the Inflation Reduction Act, is being built to prepare for what will one day be tens of millions of retired EV battery packs.

Before they are disassembled, however, studies show that around three quarters of decommissioned packs are suitable for a second life as stationary storage. (Some packs may not have enough life left in them, are too damaged from a collision, or otherwise faulty.)

“We were seeing the first generation of EVs end their time on the road, and 70 percent or more of those batteries have very strong residual value,” said Hall. “That should be utilized before all those batteries are recycled, and we’re just deferring recycling by three, four, or five years.”

Extending the useful life of EV batteries mitigates the impact of manufacturing them, said Maria Chavez, energy analyst at the Union of Concerned Scientists. 

“The whole point of trying to deploy electric vehicles is to reduce emissions and reduce the negative impacts of things like manufacturing and extractive processes on our environment and our communities,” Chavez told Grist. “By extending the life of a battery, we reduce the need for further exploitation of our natural resources, we reduce the demand for raw materials, and we generally encourage a more sustainable process.”

Just as batteries have become crucial to reducing emissions from transportation, they’re also needed to fully realize the benefits of clean energy. Without stationary storage, wind and solar power can only feed the grid when the wind is blowing or the sun is shining. 

“Being able to store it and use it when it’s most needed is a really important way to meet our energy needs,” Chavez said.

The use of utility-scale battery storage is expected to skyrocket, from 1.5 gigawatts of capacity in 2020 to 30 gigawatts by 2025. EV packs could provide a stockpile for that buildout. Hall said there are already at least 3 gigawatt-hours of decommissioned EV packs sitting around in the United States that could be deployed, and that the volume of them being removed from cars is doubling every two years. 

“We’re going from a trickle when we started four years ago to a flood of batteries that are coming,” he said. 

B2U says its technology allows batteries to be repurposed in a nearly “plug and play fashion.” They do not need to be disassembled, and units from multiple manufacturers — B2U has tested batteries from Honda, Nissan, Tesla, GM, and Ford — can be used in one system.

The packs are stored in large cabinets and managed with proprietary software, which monitors their safety and discharges and charges each battery based on its capacity. The batteries charge during the day from both the solar panels and the grid. Then B2U sells that power to utilities at night, when demand and prices are much higher. 

Hall said using second-life batteries earns the same financial return as new grid-scale batteries at half the initial cost, and that for now, repurposing the packs is more lucrative for automakers than sending them straight to recyclers. Until the recycling industry grows, it’s still quite expensive to recycle them. By selling or leasing retired packs to a grid storage company, said Hall, manufacturers can squeeze out more value out of them.

That could even help drive down the cost of electric vehicles, he added. “The actual cost of leasing a battery on wheels should go down if the full value of the battery is enhanced and reused,” he said. “Everybody wins when we do reuse in a smart fashion.”

B2U expects to add storage to a third solar facility near Palmdale next year. The facilities are meant to prove the idea works, after which B2U plans to sell its hardware and software to other storage-project developers. 

At the moment, though, planned deployment of the technology is limited. B2U predicts only about 6 percent of decommissioned EV batteries in the U.S. will be used for grid-scale storage by 2027. 

“People are skeptical, and they should be, because it’s hard to do reuse of batteries,” said Hall. “But we’ve got a robust data set that does prove reliability, performance, and profitability. We’re at a point where we really can scale this.”

This article originally appeared in Grist. Grist is a nonprofit, independent media organization dedicated to telling stories of climate solutions and a just future. Learn more at Grist.org.

This article is sponsored by Alibaba

In an era when environmental consciousness is becoming increasingly important, consumers worldwide are expressing a strong desire for more sustainable lifestyles. However, a recent independent study commissioned by Alibaba Group reveals that convenience and affordability remain significant barriers to adopting sustainable practices. 

This article explores the findings of the study and highlights the crucial role that businesses can play in making sustainability more accessible. Through transparency, affordability and a commitment to sustainability, businesses can engender the trust of consumers and empower them to make conscious choices for a better future.

Bridging the gap: Convenience and affordability 

The study, titled "The Sustainability Trends Report 2023," surveyed over 14,000 consumers across 14 markets. It found that convenience and affordability are key factors for consumer behavior. Consumers cite lack of information (48 percent) and high prices (45 percent) as the major obstacles preventing them from making more sustainable purchases. Businesses can address these concerns by making sustainable options more convenient and affordable.

Building trust through transparency

Consumers surveyed showed skepticism (38 percent) toward businesses' claims of sustainability, with only 15 percent expressing complete trust in such claims. Building trust is essential for businesses looking to engage consumers in sustainable practices, and transparency is key to bridging this trust gap. 

By providing concrete evidence of their sustainable practices, businesses can demonstrate their commitment and earn the trust of consumers. This might be particularly important for consumers in European markets, where we measured higher levels of skepticism of sustainability claims.

Alibaba's commitment to sustainability

Alibaba Group’s approach to help address the sustainability challenge recognizes our unique capabilities as a digital platform company. As a result of Alibaba’s platform model and ecosystem, we are pioneering the concept of "Scope 3+." Scope 3+ refers to the emissions generated by a wider range of participants in a digital platform’s ecosystem, currently outside of the Scope 1, 2 and 3. Scope 3+ business ecosystem decarbonization supports technological and business model innovations to enable and engage with a broad range of stakeholders in more decarbonization actions

In our latest Environmental, Social, and Governance (ESG) Report, Alibaba disclosed its first annual Scope3+ decarbonization progress with state-of-the-art scientific measurements and third-party verification. Alibaba showed how a platform can help reduce barriers, increase transparency, and expand sustainable choices for consumers. Our Carbon88 carbon ledger and Low-carbon Friendly Products Program offers over 180 million consumers information and rewards for green choices across our diverse platforms, from selecting no cutlery in food delivery to choosing certified green products. Our Decarbonization-friendly Actions program works with leading consumer brands to design and offer more sustainable products sold on our platforms. 

The result of these efforts is to make sustainable choices more abundant and transparent, while maintaining their affordability.

Empowering consumers for a sustainable future

On a positive note, the survey results show that consumers globally are eager to learn and engage in sustainable practices. Over three-quarters (76 percent) express a desire for more information on how to be more sustainable, with emerging Asian markets showcasing the highest willingness to learn. 

Businesses can facilitate this learning process by providing accessible information and educational resources. Respondents also emphasized the importance of affordability, sustainable packaging, and wider product choices. By fulfilling these expectations, businesses can help consumers make sustainable choices with ease.

Technology as a catalyst for sustainability

The research shows that technology and digitalization can be pivotal in supporting consumers to lead more sustainable lives. Over half of online shoppers (57 percent) are utilizing digital marketplaces dedicated to sustainable products. This trend is particularly prominent in Asian emerging markets, with the Philippines (76 percent), Indonesia (73 percent) and Thailand (70 percent) leading the way.

Businesses have an opportunity to leverage technology to streamline information and search processes to address consumers who cite a lack of information (48 percent) and a time-consuming research process (27 percent) for discouraging buying sustainable products. Companies might also consider digital marketplaces tailored to sustainable products. The study highlights the untapped potential of digital platforms, particularly in Asian emerging markets, where online shoppers express high preferences for buying sustainable products.

Businesses, particularly digital platform operators like Alibaba Group, have a crucial role to play in overcoming these obstacles. By prioritizing transparency, affordability and a diverse abundance of sustainable options, businesses can earn the trust of consumers and give them more conscious options. Together, businesses and consumers can pave the way for a sustainable future that benefits both the environment and society as a whole.

This article is sponsored by Alibaba

Standard business practices have stretched far beyond planetary boundaries — placing Earth’s climate biodiversity and ecosystem services on the brink of collapse. Companies must reduce environmental impacts. It isn’t only a moral imperative — it’s essential to business survival.

Planetary boundaries are nine critical thresholds that delineate the limits of Earth’s essential functions. When the world operates within these limits, the planet functions like a well-oiled machine, benefiting businesses and the general well-being of all species. When the world operates outside those limits, there are devastating consequences — such as extreme weather events, mass extinctions, land degradation, droughts and pollution.

But it’s not all sacrifice. Bringing business operations back within planetary boundaries will unlock competitive benefits, such as increased economic resilience, reduced operational risk and an edge against competitors.

A matter of business survival, not just success

An analysis of financial disclosures found that over 200 of the world’s biggest corporations will face $1 trillion in climate change-related costs in the decades ahead. These companies also estimated $250 billion in assets may need to be written off or retired early due to high-risk location and government regulation. Other studies go even further, estimating up to $24.2 trillion in costs to the global financial sector.

While markets have not yet collapsed, there are many examples of significant business challenges related to droughts, biodiversity loss and extreme weather.

Droughts: Back in 2015, drought conditions in California contributed to a 28 percent decline in Campbell’s carrot business profit and forced Starbucks to move its water bottling operations to Pennsylvania. And last year, heatwaves and droughts in Europe resulted in steep drops in corn, sunflower and soybean yields.

As the planet warms, scientists predict droughts will become more frequent and severe. Local and federal governments will make tough decisions on who can use limited water resources, prioritizing essential services and citizens. Businesses producing non-essential goods and services will be at risk.

Extreme weather: In 2019, PG&E filed for bankruptcy due to $30 billion in liabilities from wildfires potentially caused by its power lines. Hurricanes have repeatedly devastated the tourism industry in Puerto Rico, causing hundreds of billions in damages. Due to record-high precipitation, floods in the U.S. Northeast are estimated to result in $5 billion in losses from New Jersey to Vermont this year. Businesses large and small can expect devastating liabilities, service disruptions, and loss of revenue as workforce continuity takes a hit.

Biodiversity loss: More than half of the world’s gross domestic product depends on ecosystem services, and their functional decline already costs the global economy $5 trillion a year. Food businesses are particularly strained by biodiversity loss. More than 75 percent of global food crops rely on pollinators, which are dying at rapid rates. Marine species loss from climate change and overfishing has resulted in insurmountable challenges for fisherman and the rapid decline of cod, crab and shrimp in the U.S. In Europe, Baltic fisheries are even forced to shutter operations due to regulatory pressure or just a lack of fish to catch.

Less biodiverse ecosystems are also sensitive to invasive species. Roughly 20 percent of Earth’s land and water are currently at risk, and scientists estimate the effects of invasive species have already taken a $1.3 trillion financial toll in just 40 years.

The benefits of heeding planetary boundaries

Despite the risks, many corporate leaders cite "high investment, low return" and industry competition as excuses to maintain or even increase environmental impact. But by bringing operations within planetary boundaries, companies can fortify their economic resilience and even outpace peers.

Improve economic resilience: The organic agriculture market is a great example of how alignment with planetary boundaries can increase economic resilience. Most nitrogen-based fertilizers are derived from the ammonia manufactured through natural gas. When the Russia-Ukraine war began, international sanctions on Russia caused natural gas prices to skyrocket. But due to industry standards that forbid the use of nitrogen-based fertilizers, organic producers kept costs stable while the rest of the market struggled. 

As the world works to reduce the consumption of fossil-based materials, companies that are less dependent on fossil-based resources are shielded from risks posed by regulatory and inflationary challenges.
 
Outpace competitors: Contrary to popular belief, global studies show that the most sustainable companies are usually also the most profitable. Take Patagonia, for example: It’s one of the world’s largest and best-known outdoor apparel brands, approaching $1 billion a year in profits. Yet its "slow fashion" model helps the company align with planetary boundaries. Patagonia makes over 80 percent of its products from recycled materials, and the company’s free repair services and Worn Wear program extend the lifecycle of damaged and secondhand products.

See also the industry rise of sustainable native companies such as Veja, Native, Who Gives a Crap and Beyond Meat. These startups have embraced sustainable operations from the start and have flourished in the market both from a consumer brand perception and financial perspective, forcing traditional competitors to adapt.

Taking the first step

Humanity has an unconscious belief that it has separated itself from nature. The reality is that we are more dependent on the planet than ever before.

Discussing planetary boundaries in the boardroom starts with understanding operational dependency on nature. Start with these questions:

• Which commodities or sourcing areas is the business model most dependent on?
• How will climate change, biodiversity loss, and water scarcity impact key commodities or sourcing areas?
• What ecosystem services (such as pollination, water purification or soil moisture) are critical to business operations?
• If these ecosystem services ceased their function, how much would it affect the bottom line?
• Is the company currently replacing an ecosystem service (such as diverting water to a drought-stricken area, or transporting bees to pollinate plants)? If so, how much does it cost each year?

Every company is dependent on nature in some way, but many will quickly realize they don’t have answers to these simple questions. Nature dependencies are often missing from risk evaluations.

Once identified, leaders can develop a holistic plan to address environmental impact on all operational levels. While there is no silver bullet, companies must stop working against nature and begin working within planetary boundaries. The cost of inaction far exceeds action, and nature is coming to collect.

Climate action and climate justice movements don’t always feel like spaces that recognize or welcome folks from diverse and underrepresented backgrounds. Effective storytelling can create a sense of belonging and inspire real action on the ground. Yet too often the power of storytelling is underestimated.

A rising chorus of young and diverse storytellers want to change that narrative, building on a growing body of evidence that demonstrates storytelling can change human behavior. Connecting personal narratives to the challenge of climate change sparks emotional responses that ease anxiety and promote a sense of agency rather than helplessness, according to a 2023 analysis published in Psychology Today.

That is the experience of a group of young climate activists who distilled their approach to effective storytelling in a panel discussion on storytelling for climate action and climate justice at the Nest Climate Campus event during Climate Week this fall. 

As they shared their personal histories and experiences, six distinct themes emerged as the throughlines of an effective narrative to win not just the minds, but also the hearts of those who might feel disenfranchised or disaffected by the climate movement. Done well, storytelling around the climate crisis will:

1. Invite a sense of belonging
2. Create an emotional connection
3. Acknowledge the importance of culture
4. Actively engage the listener
5. Embrace each person’s unique identity
6. Offer solutions and action, not gloom and doom

Invite a sense of belonging

When he became interested in plants more than a decade ago, Nelson ZêPequéno said he was looked down on for working with flowers as a Black male.  

“In our culture, it wasn’t encouraged for us to be in nature,” said ZêPequéno, a Los-Angeles-based artist and founder of the viral Instagram page @BlackMenWithGardens. “There is the traumatic history of our forced tutelage in the fields and a lack of access to these natural spaces. As a result, a lot of our culture is based on other things. It was more likely for me growing up to think that I could be an NBA player than a climate justice warrior.” 

He began to see more and more people in his community interested in gardening at home and farming, but he saw few visual references to that growing movement. To bring these stories to light he started @BlackMenWithGardens, which today has more than 152,000 followers. 
@BlackMenWithGardens features reposted stories of Black men and boys connecting with nature and chronicles ZêPequéno's own journey in the garden — creating a shared online space that allows people traditionally left out of this community feel included in it. Storytellers can do the same by being open about their own stories of entering a space that wasn't always inclusive and sharing their platforms with others who are navigating similar challenges, helping audiences to see they are not alone.

As ZêPequéno felt more connected to the environment and part of nature through plants, he brings the stories of “other men, boys, fathers, sons, uncles reconnecting with nature and, by doing so, encouraging them to take more stewardship for it,” he said. 

Create an emotional connection

Sustainable fashion blogger, photojournalist and labor rights activist Aditi Mayer was inspired to make fashion her storytelling platform when she learned about the collapse of the Rana Plaza factory building in Bangladesh in 2013 — the garment industry’s worst industrial incident in history in which 1,110 lives were lost and over 2,000 people were injured. 

“It got me thinking about the politics of labor in the fashion industry and to look at the ills of our dominant fashion model from a social and environmental perspective,” Mayer said. “As time went on, I got interested in the solutions part of the space. What does the alternative look like? From there, storytelling became a really critical tool.”

Today she is a self-described “multi-hyphenate,” using film, photography, and journalism to examine the fashion industry through a lens of decolonization and sustainability, including as a storytelling fellow for National Geographic. From her immigrant family, she learned the value of “using fewer resources, mending clothes and passing things down,” she said.

“Today I use my platform to challenge the Instagram influencer who never wears the same outfit twice to instead champion that sustainability is a lifestyle you embody,” she said. “I work from an emotional, heart-centered space, which I think is critical because if this work was about shocking statistics to make us act, we would have acted a long time ago.”

A key learning for Mayer as a storyteller was understanding the broader historical and cultural context of the issue she wanted to spotlight: environmental and social harm in the fashion industry. As she learned, an effective story isn’t about having all the answers but in asking the right questions of the right people, like the woman artisans of rural India whose stories and knowledge were often overlooked in the modern fashion industry. 

Acknowledge the importance of culture

As a young girl spending her earliest years in her native Iran, Kiana Kazemi, co-founder and programs director for the climate justice collective Intersectional Environmentalist, recalled how her grandparents took her traveling all over the rich and varied landscape of the country, wanting to pass along a connection to the land. Those impressions stayed with her, and part of that legacy is a sense of optimism, she said.

“It was the first time I learned that my relationship to nature was deeply connected to nature, language, spirituality,” Kazemi said. “When I moved to the U.S. when I was 16 and heard about climate justice, all these ideas clicked for me — all these frameworks could exist together and make us better environmentalists and have a deeper impact on this earth.” 

Kazemi works with her team at Intersectional Environmentalist to highlight diverse voices by offering training and consulting, creating resources and activations, and deepening awareness about environmental justice and solutions.

Climate storytelling often becomes more persuasive when people can connect on a deeper and more personal level. That could be how family heritage is intimately linked to nature and landscape, as in Kazemi’s case, or, for example, by acknowledging that connection to nature is also about language, spirituality or some other cultural touchstone.

Actively engage the listener

It was the story of Kenyan activist and Nobel Prize winner Wangarĩ Muta Maathai, who founded the tree-planting Green Belt movement, that inspired Clara Kitongo on her path.

Through her work as the tree equity manager of Tree Pittsburgh, Kitongo brings her Ghanaian roots of responsibility for the land to engage communities in creating healthy urban forests, she said. She finds that their active engagement makes all the difference. 

While meeting with a group of elderly women about tree planting, Kitongo was struck by how the women’s memories of the trees they enjoyed in childhood “brought the entire project to life for them. I have learned not to assume I have all the solutions but to listen,” she said. It is the same experience when she meets with children and young adults. When she listens to their stories, they are more likely to engage.

Indeed, “the most important predictor of young people talking about their climate feeling was whether they felt listened to,” according to a recent survey of young people’s experience talking about the emotional impacts of climate change.

Similarly, when ​​ZêPequéno gardens with Black men and boys, he encourages them to “get their hands in the dirt,” he said. “I want them to learn organically. With disaffected communities, that is the main way they will learn. Storytelling is a great way to indirectly teach someone something. It becomes a core value received through a narrative.” 

Storytelling as an indirect teaching tool is powerful, as these activists found. Bombarding people with frightening facts and big numbers that don’t seem to have bearing on their own lives or communities can make people despondent or cynical. Stories, on the other hand, bring data to life and place it into a context, creating relevance about why it matters.

Embrace each person’s unique identity

For Jothsna Harris, founder of Change Narrative, her work to build capacity for the climate justice movement by using the power of diverse voices came after understanding the threads of her complex past. Her grandmother was a farmer in rural India, and her father immigrated to the United States in 1969 to create new opportunities for his family.

“I was raised knowing my worth and my value, but also that we should assimilate to be successful,” said Harris, who has farmed for the past eight years, following in her grandmother’s footsteps. “It has taken me years to unpack that and really understand we need to stand in our own unique identity.”

Her work today is dedicated to “shifting the narrative to include the perspectives and stories that are typically missing” and “the emotions and identities and vulnerability, as this is what connects us as human,” she said.

Storytelling that invites a sense of belonging for all people, no matter their background, is a vital tool for creating a narrative around climate action and justice that is more democratic and inclusive.

Offer solutions and action, not gloom and doom

Studies show that eco-anxiety — a chronic fear of environmental catastrophe as a result of the impacts of climate change — is on the rise. Sixty-nine percent of Gen Z respondents feel anxious after consuming content about climate change, according to a Pew Research Center study. 

Storytelling can help assuage that anxiety. Young people “have been confronted with gloom-and-doom stories on media, of cities being demolished by climate disasters, and that is heartbreaking," Kazemi said. "But it is important that we talk about the solutions and the frontline communities that are really doing the action-oriented solutions work.”

Harris agreed. “Any culture movement I can think of has always included the power of narrative as the underbelly. When I think of social movements, I think about the stories,” she said. 

The key in shifting to a more positive narrative is to tap into every human being’s connection to nature, which will almost always create the space for a deeper understanding of how climate change is threatening that connection.

Great storytelling passes the mic to climate heroes

Matt Scott, director of storytelling and engagement at the climate solutions nonprofit Project Drawdown, knows the power of story through his role as the producer of  “Drawdown’s Neighborhood,” a documentary series that highlights unheralded climate heroes.

“For a long time, I did not connect with the culture of the environment and the stories being told. When you don’t see yourself represented, you don’t enter those spaces,” Scott said. “Today my role is to pass the mic to climate heroes whose stories aren’t heard as often and to elevate climate action in the process.”

Bringing underrepresented groups into the story circle is a critical element in climate justice, Harris said. “These are the people experiencing not only a disproportionate amount of the impacts but who have proximity to and perspective on the issues. Their stories are the essential testimonies needed to understand how to incorporate justice into the solutions we’re seeking.”

This story on converting unused office space to affordable housing is part of The Solutions Effect, a monthly newsletter covering the best of solutions journalism in the sustainability and social impact space. If you aren't already getting this newsletter, you can sign up here. 

All year we’ve seen companies across the United States take their stance on returning to in-person work. We can debate the importance of in-office collaboration and whether remote work boosts or hampers productivity well into next year, and I bet we will. But what if returning to the office doesn't mean people working there?

Downtowns are struggling without office workers. Small businesses built to meet the needs of those commuting to work, like lunch spots and corner stores, cannot survive when their clientele stops showing up. Many companies are requiring their employees to return to in-person work at least part-time, but remote work seems to be here to stay. Around 40 percent of businesses still say the majority of their employees work both from home and in the office, though this rate has decreased significantly since last year, according to a 2023 survey of over 500 business owners and facilities managers by the hybrid workplace platform Robin.

This year, office space is on track to reach a net decline for the first time since 2000 — likely for the first time in history, but the data doesn’t go back further than that — as Bloomberg reported in July. Seventy-five percent of businesses plan to downsize their office space next year, and 82 percent are worried they can’t keep their current space due to underutilization or a recession, according to Robin’s 2023 survey.

Meanwhile, cities are facing a concurrent problem: an affordable housing shortage. The U.S. is 7.3 million rental homes short of meeting the needs of renters with extremely low incomes, according to the National Low Income Housing Coalition. “That is, incomes at or below either the federal poverty guideline or 30 percent of their area median income, whichever is greater. Only 33 affordable and available rental homes exist for every 100 extremely low-income renter households.”

So, the U.S. needs millions of affordable apartments, and downtowns full of half-empty offices need foot traffic to sustain the local economy. You can probably see where this is going.

In the rural part of the Midwest where I grew up, it’s become normal to enter a Family Video building — recognizable by the signature glass pillar out front — with no intention of picking out a movie, as many of them were transformed into entirely new stores when everyone stopped renting DVDs. Our buildings evolve with us. Who’s to say that what we think of as a high-rise building stuffed with cubicles now can’t be a typical apartment building in the future?

Across the country, 45,000 offices are currently under renovation to become rental apartments, according to a 2023 report from the apartment listing service RentCafe. Converting empty commercial and office space into living space offers the opportunity to address both problems with a single solution. Some developers already made this a reality. In Rochester, New York, designers added windows, courtyards, and rooms to an old Sears building to convert it into a 73-unit apartment complex for low-income seniors, Fast Company reported earlier this month. The project was made possible with tax credits for low-income housing and financial support from the city.

In Philadelphia, an office building from 1929 was converted into 206 apartments back in 2014. Buildings from this era were designed with features like opening windows and offices with no more than 26 feet between the outer wall and the central corridor. Thus, they are easier to turn into rental units that get plenty of natural light without having to significantly alter the structure of the building, The New York Times reports.

It’s not impossible to transform modern offices that are wider, taller and further away from the design of a typical apartment building, either. A 457,000-square-foot office built in New York City in 1970 was made into an apartment complex in 2017, The New York Times reports. Still, redesigning buildings like this is an expensive, complicated task. Among other things, the developers had to add a courtyard through the center of the building and replace the exterior walls of inoperable windows to make it work. Laws that require residential units to have windows that open vary across the country, but they are necessary in New York.

Apart from the difficult design process, zoning regulations often limit what’s possible, and the overall cost often pushes rents into the luxury price point so developers can recoup their losses. But like the Sears project in Rochester, cities can make affordable units a feasible part of these projects with economic incentives like tax reductions and subsidies.

Starting in 2024, a new pilot project in Boston will offer reduced property taxes for those who convert their commercial office space for residential use. The mayor of Washington, D.C. also proposed expanding the city’s property tax break program for commercial-to-residential developments this year. Several projects are already underway in D.C., totaling an estimated 2,500 new apartments. At least one — a 1980s office building previously used as the headquarters for the National Association for the Education of Young Children — is set to be completed by next year.

Of course, there is no one-size-fits-all way to utilize vacant downtown spaces and address the housing crisis. This is just one option in the slew of solutions required to address the issues. While office space redesigns aren’t possible everywhere, they are succeeding in some locations, and many other buildings hold the same untapped potential. 

Dive deeper into this solution: 

• This old Sears store is now an apartment building, Fast Company 
• Here’s How to Solve a 25-Story Rubik’s Cube, The New York Times 
• Video: What It Takes to Convert a Multimillion-Dollar Office Into Housing, The Wall Street Journal 

Kelly Bencheghib stands hip-deep in plastic in one of Bali’s most polluted rivers in the heart of Denpasar, the island’s capital city. While volunteer cleanup crews in the United States are picking up pieces of plastic deposited on their favorite beaches, in Indonesia, the plastic onslaught is a tsunami. 

Indonesia is the fifth largest contributor of marine plastic to the ocean, according to a 2021 study published in the peer-reviewed journal Science Advances. The country's Ministry of Environment and Forestry says 59 percent of its 564 rivers are heavily polluted.

Bencheghib and her siblings, Gary and Sam, are attacking the issue alongside 120 ”river warriors” they employ to clean rivers and beaches in the province of Bali and beyond. Their environmental organization — Sungai Watch — sees people, not just technology, as the ultimate solution.

The goal: keep plastic from reaching the ocean and beaches by cleaning rivers.

Global interests, from the United Nations to the world’s largest corporations, are grappling with the changes needed to address the ocean plastic crisis. However, some of the best solutions are happening where the crisis hits home, run by people like the Bencheghib siblings.

They grew up in Bali, surfing, going to the beach, and seeing plastic pollution impact their home. “We thought it wasn’t normal and wanted to do something,” Kelly Bencheghib said. “As teenagers, we didn’t have any funds, but we had tons of energy.”

They started a youth-led organization called Make a Change Bali when Kelly was 16, Gary was 14 and Sam was 12. The group cleaned beaches every weekend and generated community interest to help. As they grew older, the three expanded the scope of the organization and renamed it Make a Change World. 

“Our goal was just to get plastic pollution on front-page news by mixing expeditions and adventure with the topic,” Bencheghib said. They used film and social media to reach large audiences. In 2016, Gary and five friends navigated a raft down the Mississippi River while making an award-winning documentary called “Traveling on Trash.”

A year later, Gary and Sam made two plastic bottle rafts and floated down the plastic-polluted Citarum River in Indonesia. “That’s when we realized rivers are the connection point between life on land and life on the ocean,” Bencheghib said.

The Citarum expedition caught the attention of Indonesia’s president. After he saw the videos the siblings produced, he mobilized 7,000 soldiers for the largest river cleanup in Indonesia to date.

After they graduated college, Kelly, Sam and Gary redoubled their efforts. They started by experimenting with various barriers to capture trash in rivers. Even though they weren’t a formal organization, WWF gave them their first grant which allowed them to rent a place to sort trash other than in their parents' garage.

Now, the siblings are the core organizational group at Sungai Watch, where they and their team of river warriors work six days a week to clean 180 trash barriers. 

All of the warriors are paid employees. “It is such hard work. It is a given that they should be taken care of as much as possible and be given job security,” Bencheghib said. Volunteers are also a huge resource, particularly for weekly village cleanups. 

Data is critical to their work. In its 2022 Impact Report, Sungai Watch audited 235,218 individual waste items to identify the source of the pollution to drive conversations with the government and the companies most responsible.

Sungai Watch installed its first trash barrier on October 10, 2020. As of October 30 of this year, 180 barriers are installed, 800 community cleanups were held, and the organization has collected more than 1.5 million kilograms (over 3.3 million pounds) of plastic.

Yet, the organization pointed out in its impact report that no matter how many barriers are installed, plastic continues to enter the rivers at devastating speeds. So, having just passed the three-year anniversary of deploying its first barrier, the group is using what it learned to develop a village-based intervention model to stop the plastic before it reaches the river.

There are three primary sources of the trash that makes its way into Indonesia’s rivers: people throw it into the canals that flow past their homes, it’s dumped in illegal landfills and it’s thrown off bridges.

Changing these practices at the village level is the critical step to stopping the flow of plastic. “We learned that we have to work closely with communities and that it is very cultural,” Bencheghib said. “How you speak to people is super important. You have to be very humble. Community work must be accomplished before the why, the how, and the what needed to move forward.”

While the ultimate goal is to keep the ocean free of plastic and help the people relate more to the river through culture. Stories from the older generation evoke fond memories of being able to swim and fish. Returning a sense of ownership is essential to the villages’ understanding that restoring rivers to a more pristine state is achievable. 

Sungai Watch hopes to finalize the intervention model in the next few months and will share it with “whoever wants to replicate it, get inspired from it and adapt it to their community,” Bencheghib said. The basic elements include removing 100,000 kilograms (just under 220,500 pounds) of plastic per year, installing 15 trash barriers, hosting weekly community cleanups and monthly community outreach sessions, establishing one local sorting and processing station, and employing a local team of river warriors.

The organization’s effort is already showing success. Fish returned to one of the nine villages they work with, as have a community of fishermen who fish in mangroves that were cleaned up by Sungai Watch. “When you clean rivers, the fish life comes back, and we hope to see that replicated in many more rivers,” Bencheghib said.

The scope of its work continues to expand. To better utilize plastic waste, the Bencheghib siblings launched an in-house social enterprise called Sungai Design which creates furniture out of  some of the plastic collected. They are putting together the first catalog of products, and profits will go directly to supporting Sungai Watch. In addition to working with more villages in Indonesia, they plan to expand to the Philippines in 2024. 

In an economy that often pits people against the planet, outdoor recreation retailer REI is trying out a different path with its new distribution center in Lebanon, Tennessee. The center, which ships goods to more than 60 stores in the area, was specifically designed to address both worker well-being and environmental impact simultaneously.

“At its core, if we start with climate, we're solving for a healthy environment, right? A healthy world well into the future that supports all types of ecosystems,” said Andrew Dempsey, senior manager of sustainability at REI. “But it's really the intersection of that in support of people. That's an outcome that we feel is most important.” It all goes back to REI’s core mission, Dempsey said, “which is to get folks outside.”

A changing climate does not bode well for outdoor activity

The future of outdoor recreation is undoubtedly under threat as the climate crisis worsens. With rates of extreme temperatures intensifying, being active outside is hazardous more and more days per year — even for healthy people. It’s not just heat waves or extreme cold that threaten recreation. Increasing wildfire risks put recreational areas and nearby outdoor enthusiasts in danger, while the smoke from those fires further contributes to negative health effects. Bigger storms, longer droughts, and changing rainfall patterns that lead to flooding are all contributing to an untenable situation for those who want to enjoy the great outdoors. And it’s bad for the businesses that supply them with gear, too.

“We do feel it's an existential threat to the future of our business and to the future of life outside,” Dempsey said. REI’s response to this is an all-hands-on-deck approach, which is why the company paid special attention to every aspect of the design for its new distribution center. 

“We really did seek to consider the entire lifecycle carbon impacts of the building, from design through construction and operation,” he said. “We looked at the embodied carbon of a couple of major material types within the building — concrete and steel — and worked with our builder to [source] materials for both of those that have lower embodied carbon than would have been their standard in the area.”

Harnessing renewable energy while increasing efficiency at the new REI distribution center

Normally buildings like this are heated with natural gas. The Lebanon distribution center has a 1.1-megawatt rooftop solar array that meets about two-thirds of its energy needs. The remainder is procured from a renewable energy provider. “We're not burning any fossil fuels on-site. We have electric heat pump heating systems,” Dempsey said. “So 100 percent electric, 100 percent renewable energy.”

Not only is all of the energy renewable, but the building was also designed with efficiency in mind — beating code requirements by over 30 percent. “We feel like we've built a building that sets up a best-in-class sample for warehouses and for this building type in fighting the climate crisis,” he said.

Bringing the outdoors into the workday

Using electric forklifts and conveyor belts with sensors that only run when they are moving product makes the new distribution center much quieter than what's typical, which is better for employees for whom noise can take a toll. The 90 skylights on the roof — twice as many as the company’s last distribution center — are also a big part of creating a more natural environment inside. Adding more windows is a simple thing companies can do to nurture a connection to the outdoors, Dempsey said. 

“When you're in these spaces it feels different. Natural daylight feels different. You have a connection to where the sun is, what time of day it is outside,” he said. “Typically, warehouses are dark, cavernous spaces. Where you don't have a connection to the outside. You have no access to views, no access to daylight. And you're working in a space that, from a basic human level, may not be all that comfortable.” 

A walking and biking trail and habitat restoration are two projects currently in development on the campus to give employees more access to the outdoors. Covered bike racks encourage carbon-free commutes, and the showers and changing rooms in the employee gym make doing so a more comfortable experience for everyone. There are also six charging stations available for workers who own electric vehicles, Dempsey said.

Raising the bar for distribution centers

REI is not immune to the issues like layoffs and employee dissatisfaction that are prevalent across sectors like retail right now. But this new building design is raising the bar for both employee well-being and environmental responsibility at distribution centers. 

Though many retailers may be relatively insulated from the effects of the climate crisis compared to brands that rely on outdoor activity for sales, like REI, eventually all bottom lines will be affected. It would be wise for more distributors to design their buildings to mitigate the climate crisis. Doing so while valuing employee well-being will pay dividends in tenure and productivity.

This story is part of a new solutions journalism series focused on refillable packaging, how refillables are used around the world, and what's holding these systems back from scaling further. Follow along with the series here. 

You'll likely notice something different when you order a Corona in Mexico — and we're not just talking about the taste. If you look closely at the label, more often than not you'll see it's a little faded, evidence of the container being washed and reused dozens of times. Return and refill systems like this are prevalent across Latin America and around the world, and not just for beer. The world's largest soft drink companies, Coca-Cola and PepsiCo, sell billions of units in refillable plastic bottles every year across Latin America, Asia, Africa and Europe. 

To people in other markets, the news that major bottled beverage brands — among the largest producers of single-use plastic globally — are already operating successful refill systems may come as a surprise. "The refillable bottle is a very common packaging type, but one of the reasons why it's not as visible is that it's not present in the U.S. and the U.K.," said Matt Littlejohn, who leads the refillables program as part of his role as SVP of strategic initiatives at the ocean conservation nonprofit Oceana.

About 14 percent of Coca-Cola's global beverage sales were sold in refillable bottles last year. PepsiCo is around 10 percent. And major beer companies like Heineken and AB InBev, which owns Corona, sell upwards of 30 percent of all products in refillable containers globally, Littlejohn said. So, why don't these companies talk about refill more, and why aren't they selling them in the U.S.? 

How do refillable bottle programs work?

From Mexico to Chile, Germany to the Philippines, millions of people around the world see bottle return and refill as commonplace. But for the uninitiated, it may sound confusing at first. How does that even work? Really, it's pretty simple. 

When people head to their local corner store, they'll see drinks in refillable containers alongside those in single-use bottles. In Mexico, for example, most bottled beers distributed by Grupo Modelo — including Corona, Modelo and Victoria, among others — can be refilled. Customers simply bring their empties back, leave them in a designated place in the store, and pick up new beers for about 15 percent less than what they'd pay if they didn't return the packaging. When the Modelo truck arrives at the store with a new beer delivery, the driver takes the empties back to the bottling plant to be washed, refilled and used again. 

Soda and water brands owned by companies like Coca-Cola and PepsiCo have separate containers that are marked as returnable, which are made from a more durable plastic than what's used for single-use. Otherwise, the system is the same: Customers bring their empty returnable bottles back to the store and choose a new product from the shelf.

In Latin America, Coca-Cola products cost up to 25 percent less for customers returning a refillable bottle, said Andres Wainer, chief financial officer of Embotelladora Andina, a major Coca-Cola bottler in Argentina, Brazil, Chile and Paraguay. Around 30 percent of all the soft drinks Andina sells are in refillable containers, Wainer said at a panel discussion hosted by Oceana and HSBC last year. In some markets, such as Argentina and Paraguay, it's even higher — around half of all products sold. 

In short: These systems are working, and not just in Latin America. Around half of Coca-Cola's volume in the Philippines is sold in refillable containers, and similar systems are thriving in European countries like Germany, Spain and France, Littlejohn said. 

Each refillable container displaces dozens of single-use bottles, reducing the burden on waste processors around the world as well as the chance for packaging to end up as litter in the environment. Durable plastic bottles can be reused around 25 times, and glass bottles can be refilled 50 times or more, according to Oceana.

Returnable bottles also come with a substantially lower carbon footprint compared to single-use, even taking into account transportation and the water and energy needed for wash and refill. Coca-Cola claims its refillable bottle comes with 47 percent less lifecycle greenhouse gas emissions, and Wainer said he's seen estimates as high as 90 percent for some systems. 

So, why aren't brands using refillables in the U.S.?

"Really there are two things holding this back from coming to the U.S.," Littlejohn said. "The main thing is money. It's expensive. You actually have to invest." 

Bottling plants are typically constructed to move in one direction — sanitizing new bottles, filling them up and sending them out to be sold. Introducing new equipment to process and clean refillable bottles can be costly. Arca Continental, a major bottler in Mexico and Ecuador that accounts for around 12 percent of Coca-Cola's annual refillable sales, says about 20 percent of its capital expenditures go toward the refill system, Littlejohn said. 

Though the price-tag on transitioning a bottling plant to process refillables can be in the billions of dollars, it's not insurmountable considering the size and scale of these companies, Littlejohn told us. And he pointed to a straightforward solution: green bonds, sums of money raised from investors that are specifically earmarked for environmental projects.

While many consumer goods companies have issued green bonds, most have gone to purchase recycled plastic or support plastic recycling initiatives. Leveraging those instruments to support refill can help companies cover the upfront cost until the systems are up and running, Littlejohn said. "And it’s an asset," he told us. "You're investing in trucks and bottles and machines. These are depreciable assets. [Bottlers] book the deposits as a revenue source. This is in line with your business. Yes, you have to invest, but you get the money back and there's money for it." 

Along with cost, the second challenge hinges on the way companies communicate about refill, which is somewhat curious considering we're talking about firms like Coke and Pepsi that have used the magic of marketing to stay relevant for over a century. 

In places like Asia and Latin America, refillables are primarily marketed as a way for customers to save money. In his conversations with leaders at major brands, Littlejohn found that many seem convinced this angle won't work in places like the U.S., particularly as inflation stabilizes.

But even in markets where brands sell reusables on cost, field research from Oceana indicates people can and do recognize the environmental benefit of choosing reusable (check out the video above). 

"This is a way to save money. They could sell that asset in the U.S. They think they can't, but they could," Littlejohn said. "And then in addition, they need to market the environmental benefit of this. The only place they sell it on the environmental benefit is in Germany."

Turning the corner on the rise of refillables  

While refillables are already working in major markets around the world, they're highly under-leveraged and ready to scale, Littlejohn said. Doing so can come with major environmental benefits: Along with reducing lifecycle carbon emissions, every 10 percent increase in refillable bottle use across coastal countries could yield a 22 percent reduction in plastic bottle pollution in the world's oceans, Oceana estimates. 

Brands say they're ready to be part of the transition. Coca-Cola, for example, aims to increase its sales in refillable containers from 14 percent today to 25 percent by 2030. But they have a long way to go when it comes to raising awareness and getting more bottlers and distributors around the world involved. 

"They should be telling people about this," Littlejohn said of brands like Coke and Pepsi. "They’re doing this at such a huge level, and no one really knows it." 

In a small sign of change, Arca Continental, Coca-Cola's primary bottler in Mexico, also serves Texas and started rolling out refillables in select markets last year. After a successful 2022 pilot in El Paso — the first time Coca-Cola used refillable containers in the U.S. in over a decade — Arca expanded the program to San Antonio this year. 

"This is a direction that I think generally a lot of consumer branded companies are going to have to move in, because they're going to have to deal with the waste issue, and this is a way you can do it," Littlejohn said. "It's a simple thing, but it is such a radical simple idea, because it's not single-use." 

The global petrochemical industry continues to expand, adding to concerns that oil, gas, and coal are being consumed at an unsustainable level. Meanwhile, the green chemistry movement has already begun to introduce bio-based plastics, cleansers and other familiar consumer products that don't require fossil fuel feedstocks. Now, a new round of green chemistry innovation is going beyond common household products to decarbonize industrial processes, supply chains and fuels.

Petrochemicals are growing

Fossil fuels are not only used for heat and energy, but also as the building blocks for plastics, chemicals and more. The field of petrochemicals includes compounds made from natural gas as well as petroleum. In some countries, notably China, coal is also used as a chemical building block.

Common household petrochemical products include synthetic fabrics, rubber and detergents, in addition to a wide range of fuels and plastic items.

Plastics are often cited as the main driver of petrochemical growth and pollution. New research by the firm Emergen, though, indicates that global automotive and pharmaceutical sectors have also become powerful growth factors.

“Petrochemicals are set to account for more than a third of the growth in world oil demand to 2030 and nearly half the growth to 2050,” the International Energy Agency warned in a widely cited 2018 report, which also forecast a rise in petrochemical demand for natural gas.

Similarly, Fortune Business Insights predicts the global petrochemicals market will experience strong growth in the coming years, reaching $886 billion by 2030, compared to around $628 billion today.

Spotlight on sustainability

Notwithstanding this activity, signs of change are emerging. Rachel Carson’s influential 1962 book "Silent Spring" motivated new generations of 20th-century chemists to focus on sustainability. Those efforts culminated in the 12 principles for harm reduction outlined in the 1998 book "Green Chemistry: Theory and Practice" by John Warner and Paul Anastas.

The book did not stop the petrochemical industry, but it did lay the groundwork for change. "Green Chemistry" continues to guide the field today, and its full effect is beginning to emerge with new advances in molecular science.

The new wave of green chemistry replicates photosynthesis, the natural process by which plants create new molecules from carbon dioxide.

“We’re accelerating it and doing it in real time,” said Mahlet Garedew, innovation program manager at the Brooklyn-based chemistry startup Air Company. “Why don’t we start assembling these molecules at the molecular level and mimicking what nature is doing? This is the core of green chemistry. It’s the design of products and processes. That’s why this technology is exciting.”

The molecular approach is reflected in the six winners of the 2023 Green Chemistry Challenge, a program of the U.S. Environmental Protection Agency (EPA).

Among the awardees is the Texas firm Solugen. The company’s proprietary “Bioforge” enzyme-based platform reassembles sugars, air and carbon dioxide into plastics, construction materials and other products. The New Jersey company Modern Meadow's bio-based protein foam replaces petrochemical dyes, reducing water use by 95 percent and energy consumption by 75 percent.

The follow-on health and safety benefits of green chemistry are also illustrated by an award to the Georgia firm Captis Aire. The company captures compounds called terpenes from wood processing facilities and converts them to biofuels, fragrances and other products. “Currently these terpenes can be an air pollutant, an irritant to eyes, lungs and skin, and are commonly burned as waste which releases greenhouse gases,” the EPA notes.

Starting the recarbonization conversation: A new biofuel made from biofuel emissions

Air Company was also included among the 2023 awardees for its trademarked “AirMade System” that recombines carbon dioxide and water into new forms. The award underscores how green chemistry can help support other elements of the bioeconomy.

The company launched in 2017 with two signature products, a vodka and a perfume, made with carbon from ethanol fermentation plants. The launch helped raise awareness about green chemistry's potential to impact a wide variety of industries, Garedew said. The company also produced hand sanitizer during the COVID-19 pandemic and even worked with NASA to convert carbon dioxide into sugars, with the aim of one day synthesizing food in space.

In the area of ethanol and biofuels alone, the potential for green chemistry is vast. U.S. ethanol producers, for example, are depending on new carbon capture and sequestration projects to cut their carbon footprint. However, new pipelines and sequestration proposals are encountering roadblocks, including the cancellation of a proposed 1,300-mile carbon pipeline for the U.S. Midwest.

A new McKinsey report also indicates that capture and sequestration is not an effective pathway to net zero. McKinsey advocates for a “recarbonization” of the biofuels and chemistry industries, using biomass and carbon from the atmosphere instead of fossil sources.

The AirMade System meets the recarbonization standard while raising the potential to avoid new pipelines. The modular, transportable system can be located at or near the point of carbon emissions. The system also includes water-sourced green hydrogen technology, powered by renewable energy.

This distributed-by-design business model eliminates the need for a centralized carbon sequestration facility. It creates the potential to deploy existing pipeline, road and rail infrastructure, and it enables ethanol producers to generate additional fuel from the same amount of biomass. 

The company can use a variety of industrial emissions for carbon, but its main focus is currently on fuel from ethanol plant emissions and other bio-based sources. “Really the big impact is in chemistry and fuel industries, specifically aviation,” Garedew said. 

More pressure on petrochemicals

Pressure on the petrochemical industry is beginning to rise from other sources. One example is the Beyond Petrochemicals initiative, launched in 2022 by Bloomberg Philanthropies and aimed at stopping the construction of new petrochemical plants in the U.S. 

Academic resources are also gathering force. The new Center for Green Chemistry and Green Engineering at Yale University, for example, is a partnership with the United Nations to introduce green chemistry in key industries around the world, beginning with the replacement of hazardous materials in the textile and construction sectors.

The trade association American Chemistry Society co-sponsors the EPA's Green Chemistry program as part of its support for an industry-wide pivot away from petrochemicals and other hazardous materials. In contrast to past practice, the group now encourages its members to create “a new reality for chemistry and engineering” based on pollution prevention, waste reduction, resource preservation, and energy conservation.

Next steps for green chemistry

The rising uproar over the toxic impacts of the “forever” chemical group PFAS indicates the American Chemistry Society has a lot of ground to make up. The field of green chemistry itself is also evolving, as advocates for the “sustainable chemistry” movement press for the inclusion of more holistic, long-term ecological goals.

Above all, chemists themselves are emerging as powerful change makers.

“By training I’m a biosystems engineer, and I worked in an organic chemistry lab on the bio-based side of green chemistry,” Garedew explains. “A lot of my Ph.D. work was promoting that, and thinking where we can implement the principles of green chemistry.”

“Innovation is always on the horizon,” she says. “There are so many things we can do with carbon dioxide.”

This story is part of Equalizing Wealth, a guest-contributed column that takes a sharp look at the interconnected factors driving racial wealth disparities in the United States — and puts forward evidence-based ways to address them. If you're interested in contributing your perspective to this column, please get in touch with us here. 

Last year, Drs. Nathan Connolly and Shani Mott, a Black couple from Baltimore, Maryland, sought out a home appraisal to refinance their mortgage, and their home was estimated at $472,00. Recognizing the valuation was out of line with homes in the area, the couple removed any traces of their race, including family photos and books by Black authors. The pair then outfitted the home with generic artwork, white family photos and asked a white colleague to pretend to own the home. After conducting this social experiment in racial bias, their second appraiser estimated the home value to be $750,000.

Drs. Connolly and Mott believe the initial appraisal process used subjective criteria to evaluate their home, including proximity to a majority-Black neighborhood and proximity to a busy street. The couple tried to challenge the appraisal with their initial lender but were met with silence.  

On the other side of the country in San Francisco, California, another Black couple, Paul Austin and Tenisha Tate-Austin, sought out an appraiser to refinance their mortgage to pay for major upgrades. The initial appraiser valued the home at $995,000. What’s most shocking is that approximately a year earlier, the home was appraised for $1.45 million. Fortunately for the Austins, when they challenged their home appraisal, the lender agreed that the appraisal's subjective criteria were “incorrect or inappropriate.” Like Drs. Connolly and Mott, the Austins removed items hinting at their racial identity, including family photos and hair care products, and also asked a white friend to pose as the homeowner. The second appraiser valued their home at $1,482,500, higher than the previous two estimations.  

Both scenarios illustrate the negative systemic conditions families of color often face during the homeownership process. These conditions contribute to our racial wealth divide. Whether a person is selling or buying their home, appealing a property tax assessment, applying for a home equity line of credit, or refinancing a loan, a home appraisal is necessary to ensure a home’s value is accurately assessed.

Home appraisals play a key role in setting a foundation for generational wealth, offering the homeowner access to the full equity when they pay off their mortgage. 

Home appraisers are intended to give an “independent, objective, and unbiased opinion of the estimated market value of a residential property” based on home condition, size, amenities and upgrades, according to the U.S. Department of Housing and Urban Development (HUD). While home appraisals should be a race-neutral process at face value, racial bias is still alarmingly present in the home appraisal process, and these two stories are not anomalies.  

A 2022 Fannie Mae study looked at 1.8 million appraisals for refinance applications in 2019-2020, and researchers found that white-owned homes were valued at higher rates in all neighborhoods but especially those in majority-Black neighborhoods. The researchers concluded that the overvaluation resulted in a 10 percent higher appraisal value in their automated valuation models. 

To address the racial bias in the appraisal process, the Joe Biden administration commissioned the Interagency Task Force on Property Appraisal and Valuation Equity (PAVE), a group of 13 key agencies that have an impact on the appraisal process, to create an Action Plan. The PAVE task force was inspired by U.S. Rep. Maxine Waters' (D-Calif.) plea to protect consumers in the appraisal process through letters to the Biden administration and her subsequent bill, House Resolution 2553. 

With homeownership as the primary way for most people to build wealth, racial bias in the home appraisal process can contribute to the divide between wealth for white families and that of their Black and Brown peers.

White households hold 11 times more wealth than Black households and nearly six times more wealth than Latinx households, according to Prosperity Now's State of Household Wealth and the Racial Wealth Gap in 2020 report. In fact, the PAVE report notes that the “financial returns associated with owning a home” is “perhaps [one of] the biggest drivers of the racial and ethnic wealth divide." If advocates are committed to eliminating racial inequities in wealth building, we must also be committed to disrupting the barriers that devalue home prices because of race. 

The PAVE task force devised five key recommendations that aim to create equity in the home appraisal process through arming consumers with knowledge to identify appraisal bias and how to combat it, diversifying the appraisal workforce, providing better data and research on bias and how to identify it, and reevaluating policies and guidance to ensure that bias is eliminated from the process.  

The PAVE task force’s recommendations are extremely robust and a major step in the right direction to ensure that Black and Brown families have equal access to homeownership. Although they get to the root of the deficiencies in processes among the relevant federal agencies, which should lead to better safeguards for homebuyers and homeowners, states still have a role to play in protecting homeowners from racial bias. In 2021, California passed Assembly Bill 948 that provides homeowners and home buyers with information about contesting the appraisal process if they suspect racial bias, modifies the appraiser licensing course to include cultural competency and bias courses, and directs the California Bureau of Real Estate Appraisers to present an assessment of appraisal complaints to relevant state lawmakers.  

States also have great flexibility to rethink their requirements for aspiring appraisers, including modifying or eliminating education or experience requirements to allow for a more equitable workforce.
 
For instance, states can innovate through partnerships with state universities and state agencies to create intentional pathways into the industry through bachelor’s degree programs. They could offer programs that help aspiring appraisers meet education and experience requirements, host appraiser mentorships, or provide stipends so that those who cannot afford to train in an unpaid capacity can still obtain the necessary experience.  

It is an all-hands-on-deck responsibility to ensure that racial bias is eliminated from the appraisal process in pursuit of greater wealth equity. Consumers and advocates can also play a role in ensuring that the recommendations are being implemented in their states and that key improvements, such as incentivizing current appraisers to train up-and-coming appraisers, are funded each year.