Climate Action
6 Ways A Changing Climate Is Hitting Your Bank Balance
December 2, 2025
People who don’t understand science seem to have come up with a host of reasons not to save the planet we all depend on, many of which seem a little absurd. But maybe their purses and pocketbooks should do the talking because climate change is making life less affordable.
1. Energy Bills Are On the Rise and We All Know It
Energy bills have risen sharply in the U.S in a short period, up an average of 5.5% compared to last year, and natural gas is up ~13.8%. Several factors are contributing to this, including the war in Ukraine, rising energy demand from AI data centers, and newly introduced tariffs.
But underlying these spikes is a deeper problem: the U.S. electric grid—and the way bills are calculated—was never designed to handle climate-related stresses. Extreme heat, storms, and aging infrastructure now strain the system, forcing higher costs onto consumers. Europe and Asia face similar pressures, as growing demand collides with limited supply, highlighting the urgent need to modernize grids and invest in resilient, sustainable energy sources.
Similar challenges are occurring in Europe and Asia, where rising demand and constrained supply are pushing prices higher. In Germany, for example, a recent study projected that as mobile A/C adoption increases under future heatwave scenarios, peak load could jump significantly—potentially creating new stress points in the power grid. It is a self-fulfilling circle.
What is more, extreme heat makes the electric grid more vulnerable as natural gas turbines are 25% less efficient in hot weather. In the U.S., utility companies are trying to cope by upgrading the grid.
2. Home Insurance If You Can Get It
The U.S. home insurance market is being reshaped by climate change. Between 2020 and 2023, homeowners’ insurance premiums rose by more than 30%, driven in part by the increasing frequency and severity of natural disasters. As a result home insurance companies are charging nearly everyone higher premiums to cover more claims for damaged or destroyed homes.
States at higher risk, such as California, Florida, and Louisiana, are seeing particularly sharp increases, Florida has seen massive spikes in premiums after storms like Hurricane Ian (2022) or Hurricane Ida (2021). While some insurers have withdrawn entirely from the riskiest areas.
Countries like Australia, Japan, and parts of Europe are also seeing climate-driven insurance hikes. For example, according to a report by the Australia Institute, the average home insurance premium rose 14% between 2022 and 2023 — the biggest jump in a decade.
Regulatory differences also matter: states with weaker oversight, like Oklahoma, may see higher premiums as companies adjust to risk.
Beyond climate, other factors—elevated interest rates, rising construction costs, and skilled labor shortages—also push prices higher. However, climate change remains a central driver, as insurers are forced to cover increasingly frequent claims for hurricanes, wildfires, floods, and other extreme events.
3. Climate Change Impacts Human Health Costs
Climate change threatens human health in countless ways – natural disasters cost lives, from wildfires to flooding to extreme heat. Researchers from Imperial College London found that 2 out of 3 heat deaths in Europe this summer were directly linked to global warming.
In hard numbers that equates to 16,500 deaths.
It is not just extreme weather hurting us, climate change causes atmospheric pollution, such as raised levels of ground ozone and particulate matter which impact lung health.
Studies show that climate change will have enormous health-related costs globally. One study of 69 low and middle income countries, estimates that by 2050, climate-related health problem (like heat stress, infectious diseases, malnutrition) and deaths could cost $8.6–$20.8 trillion, with sub-Saharan Africa and South Asia hit hardest.
In the U.S., extreme temperatures drive up both health insurance premiums and healthcare use. Heat‑event days are linked to roughly 235,000 extra emergency department visits and more than 56,000 additional hospital admissions each summer — adding about $1 billion in healthcare costs. There is even evidence that climate change might increase the likelihood of pandemics.
4. Groceries
Food prices are rising worldwide due to climate change. Extreme weather events like flooring, storms and extreme heat, are making it harder to grow crops and fruits.
This in turn is causing sudden, unpredictable leaps in prices for many types of food. For example, vegetable prices rose by 80% in California in November 2022, cabbage prices rose by 70% in South Korea in the summer of 2024, and rice jumped by 48% in Japan in September 2024, all due to extreme heat events. Studies suggest that for every degree the Earth warms, the world loses the ability to produce 120 calories of food, per person, per day.
If the climate warms by 3 degrees, that’s basically like everyone on the planet giving up breakfast.
Solomon Hsiang, professor of environmental social sciences at Stanford Doerr School of Sustainability
Climate change and extreme weather can reduce food supply and raise prices, forcing low-income families to buy cheaper, less nutritious food. This can worsen health outcomes, causing a myriad of health problems, including heart disease, diabetes, and mental health conditions. Food scarcity also increases social stress and can contribute to inflation and unrest, could potentially influence political behavior.
5. Gas Prices Are Vulnerable
Oil is both unsustainable and nonrenewable. It forms from the remains of ancient plants and animals over millions of years, meaning the world is depleting oil far faster than it can ever be replaced. Because our dependence on oil remains high, shrinking supplies eventually push prices upward.
Climate change makes this volatility worse. In the U.S., for example, hurricanes—made more intense by warming oceans—can force refineries to shut down, sending gas prices soaring within hours. Extreme heat also disrupts refinery operations by reducing efficiency, limiting how much gasoline can be produced and raising prices on the smaller output.
Extreme heat—another consequence of climate change—reduces refinery efficiency, limiting how much gasoline (petrol) they can produce. With less output, prices rise. And the longer we rely on oil without investing in alternative energy sources, the more frequent and severe these disruptions will become.
6. Water
Climate change increases the chances of drought in many parts of the world, leading not only to water contamination but also contributing to higher prices. In America, water and sewer bills rose by 50% from 2013-2023, in part due to climate change harming water infrastructure, and partly as a result of city councils trying to “encourage water conservation” due to droughts.
Likewise, a recent study in England found that, while prices have been intentionally suppressed for several years, this will become increasingly impossible to maintain in the future. To modernize aging infrastructure and deal with population growth, UK households will have to start paying around 30% more between now and 2030 for their water supply.
Changes in water availability are also projected to decrease hydroelectric power generation up to 23% by 2050. This too may increase electric bills. Additionally, rising water costs may impact food production and again harm human health. The impacts of climate change are clearly having a compounding effect on our health and over all affordability.
If this incentivizes you to make pro-planet choices – check out our EARTHDAY.ORG 2025 theme, OUR POWER, OUR PLANET. We’re calling for the world to triple its renewable energy generation by 2030, and every person who petitions their government to transition to renewable energy is helping to secure a better and more affordable future for us all.
Sign the Renewable Energy Petition today.
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