Picking up the pace: Loans for residential climate-proofing

Abstract

picking up the pace: loans for residential climate-proofing aymeric bellon cameron lapoint francesco mazzola guosong xu unc chapel-hill yale som escp europe erasmus rsm the mortgage market research conference federal reserve bank of philadelphia may 2024 how to accelerate green transition of housing? homes are affected by climate change adaptation and mitigation ▶ accounted for 26% of global energy-related emissions in 2022 (iea, 2023) ▶ 1 in every 10 homes in the us was impacted by natural hazards in 2021 (corelogic 2022) investment in green residential projects is insufficient (climate policy initiative 2023) ▶ total global investment in mitigation alone is currently $28.7 bil./year ▶ yet, $827.1 bil./year needed to reach net zero emissions by 2050 we study a new class of financial contracts which aims to reduce this investment gap ▶ residential property assessed clean energy (pace) loans ▶ borrowers pay off loans through local property tax bill bellon, lapoint, mazzola, & xu (2024) pace loans for climate-proofing federal reserve bank of philadelphia how to accelerate green transition of housing? homes are affected by climate change adaptation and mitigation ▶ accounted for 26% of global energy-related emissions in 2022 (iea, 2023) ▶ 1 in every 10 homes in the us was impacted by natural hazards in 2021 (corelogic 2022) investment in green residential projects is insufficient (climate policy initiative 2023) ▶ total global investment in mitigation alone is currently $28.7 …

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