Adaptation Blended Finance Doubled in 2025, Supreme Court Hears Climate Damages Case, Weather Data for Employers' Health Partnership, and More

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Adaptation finance in blended deals more than doubled in 2025 on the year before, rising 133% to US$5.6bn, according to Convergence’s latest State of Blended Finance report. This represents the theme’s strongest annual increase in a decade. While mitigation still drew the most blended finance, at US$9.9bn, this was down 26% year-on-year.

The wider blended finance market — covering deals involving public and private contributions — held steady at US$25.8bn, while the number of transactions leapt to 181 from 160 in 2024. Two-thirds of all blended deals had a climate focus. Significantly, commitments from private institutions rose 27% to US$11.2bn overall, mostly from commercial banks.

“Several investors have emerged in recent years with an explicit adaptation focus, which has helped lift numbers in the sector. For instance, Rabobank and Aqua for All being standout players in driving adaptation investments in agriculture and the ocean economy, respectively,” said Ilsa Weinstein-Wright, a Senior Associate at Convergence, on the report’s launch.

Still, adaptation remains a niche in the broader market. There were only 21 adaptation-specific deals identified by Convergence last year, versus 50 for mitigation. The report says investors struggle to work out how climate-proofing projects can generate the revenues needed to justify their outlays.

Convergence recommends standardizing investment-stage grants so that they cover the extra cost of resilience measures that don’t earn returns on their own: “Some climate investments are commercially viable at their core but require additional expenditures to manage physical climate risk,” the report says.

Hurricane Isaias is likely to cost insurers mid-single-digit billions of dollars, according to a Gallagher Re report, with losses unlikely to change the trajectory of policy rates heading into the January 1 reinsurance renewal season. “This reflects the substantial amount of capital currently available to the global reinsurance market, where record levels of traditional and alternative capacity have left the sector well positioned to absorb moderate catastrophe losses,” the report reads. Isaias is the season’s first Atlantic hurricane and the first to batter the eastern US since 2024. (Gallagher Re)

Every US$1bn the federal government spends on flood adaptation would cut disaster relief outlays by US$1.8bn over 30 years in present-value terms, the Congressional Budget Office said. Projects funded through the Army Corps of Engineers and Federal Emergency Management Agency (FEMA) avoid US$3–4 of flood damage per federal dollar. Payoffs vary by project type: property elevations save US$2.5bn per US$1bn, while buyouts save US$1.5bn. (Congressional Budget Office)

The European Investment Bank (EIB) plans to double its climate adaptation lending to €30bn (US$34bn) through 2030, even as Brussels weighs cuts to development finance in the next EU budget. Focus areas include agriculture, water, cities, and vulnerable regions and communities. The institution says it has already tripled its annual financing for adaptation since 2021 to €4.5bn (US$5bn) in 2024. (European Investment Bank)

Europe’s summer heat may have cut EU output by about 1%, or roughly €180bn (US$210bn), according to an early estimate cited by Olaf Sleijpen, president of De Nederlandsche Bank and chair of the Network for Greening the Financial System (NGFS). Sleijpen said heat wiped almost 9 million tonnes off the European grain harvest — at a cost of some €2bn — and could add more than 1 percentage point to food inflation next year. (Bank of International Settlements)

Germany fell short of its €6bn (US$6.7bn) annual climate finance target in 2025, following cuts to the country’s development ministry, which supplies some 85% of the total. Berlin contributed €4.7bn (US$5.5bn) in climate finance to developing countries last year, around 20% less than promised. Including mobilized and leveraged private funds, the country’s contribution came to €11bn (US$12.3bn). (Clean Energy Wire)

Brazil’s climate finance efforts could shudder to a halt if Liberal Party senator Flavio Bolsonaro wins the country’s presidential runoff against President Luiz Inácio Lula da Silva on October 25. Lula’s Eco Invest program has mobilized 190bn reais (US$37.8bn) towards the green economy since 2024 — including some US$600mn in adaptation-related blended finance last year, according to Convergence. Development bank BNDES has also channeled about 15bn reais (US$3bn) into forest recovery and protection. Bolsonaro has yet to say whether he would keep Lula’s green finance programs if he were to triumph. (Reuters)

Floods across Thailand have caused an estimated 6bn baht (US$178mn) in damage to the country’s industrial sector, the Federation of Thai Industries said last Wednesday. Raging waters unleashed by heavy rainfall have swept through parts of the country since September. (Reuters)

Pacific leaders used a pre-COP31 summit in Fiji to criticize rich nations for the poor accessibility and tardy deployment of international climate finance. The Pacific Resilience Facility, a regional fund owned by island governments built to generate annual returns for small adaptation projects, holds about US$180mn against a US$500mn target for COP31. Fiji, Ireland and others added roughly US$15mn last Wednesday. (Reuters)

The US Supreme Court appeared divided last Monday over whether local governments can sue oil companies under state law for climate damages, in a case that could decide the fate of dozens of lawsuits playing out across the US.

Boulder, Colorado, sued Exxon Mobil Corp. and Suncor Energy Inc. in 2018 to make them pay for the costs of heatwaves, wildfires, droughts, and floods exacerbated by climate change. The suit alleges the companies misled the public about climate risks while producing and promoting fossil fuels. The case before the Supreme Court is not to determine whether the oil majors are liable. Rather, it is to determine whether such cases should be heard in state or federal courts.

Opening questions from the justices centered on this state-federal question. Justice Brett Kavanaugh, who was appointed by President Trump, said court precedents “make crystal clear that interstate air and water pollution are matters for federal law unless Congress specifically preserves state law.” Liberal Justice Elena Kagan, meanwhile, rejected the companies’ broad constitutional claims but asked whether the Clean Air Act already blocks the suit.

Ahead of the hearing, Justice Samuel Alito recused himself from the case. While the announcement did not provide a reason, the Justice owns stock in two oil companies and traveled on the private jet of an investor in a company involved in the suit.

His absence makes a 4-4 split on the case a possibility. A tie would leave in place a Colorado Supreme Court ruling that allowed Boulder’s case to proceed — however, it would not set a national precedent. A ruling is due by late June 2027.

UN Secretary-General António Guterres renewed his call for every city to adopt a heat action plan by 2030 at the Global Heat Forum in Bangkok last Tuesday. “That means every part of government — health, housing, energy and transport — working as one…backed by the systems and resources to make it real,” he said. Event organizers estimate that scaling heat-health warning systems could protect 1.5 billion people and avoid almost 100,000 deaths a year. (WMO)

The US Government Accountability Office (GAO) urged Congress to widen the National Flood Insurance Program’s (NFIP) mandatory purchase requirement to cover every type of flooding — including heavy rainfall inundations that federal maps leave out. According to the GAO’s report, just 14% of high-risk properties held an NFIP policy as of April 2026. While private carriers are covering some of those outside the NFIP’s coverage, they accounted for just 14% of all flood policies in 2025. The GAO also recommended that Congress make property-level flood risk information public, force home loan lenders to provide flood insurance quotes for properties eligible for federally backed mortgages, and raise NFIP coverage limits so property owners can be reimbursed for more of their potential losses. (GAO)

Representative Virginia Foxx, a North Carolina Republican, reintroduced the Disaster Recovery and Resilience Act — a reform package aimed at overhauling aid to regions of the country ravaged by natural disasters. The bill would create an Emergency Recovery Board made up of federal and state officials that would recommend temporary suspensions of rules and regulations deemed to obstruct recovery after a disaster declaration. It would also let the Homeland Security secretary waive the Jones Act — which limits the transport of goods between US ports — for 180 days so more waterborne vessels can join relief operations, and suspend local prevailing-wage requirements on disaster repair projects. (Representative Virginia Foxx)

The UK government has formed a Flood and Drought Resilience Taskforce, charged with assessing the country’s winter flood readiness and crafting responses to worsening drought conditions in summer. The new body is made up of more than 50 organizations, including the Environment Agency, the Met Office, mayoral authorities, fire services, and the farming, water, and insurance industries. Its first meeting is on October 14. (UK Government)

The Insurance Bureau of Canada (IBC) urged Quebec’s incoming government to appoint a Minister of Resilience to coordinate adaptation, land-use planning, infrastructure, and civil protection. Last week’s elections saw Parti Québécois (PQ) take control of the province for the first time. Insured natural catastrophe losses in Quebec more than doubled to C$8.1bn (US$5.7bn) over 2016-2025 from C$3.7bn (US$2.6bn) over the prior decade. IBC also wants lawmakers to introduce bigger financial incentives for property-level adaptation measures and to curb new construction in flood-prone areas. (IBC)

The City of Port Phillip in Melbourne has become the 14th Australian council to call for a National Climate Compensation Fund, a dedicated adaptation, resilience, and disaster recovery payment scheme made up of contributions from coal, oil, and gas producers. The Australia Institute estimates climate-driven disaster costs have risen twelvefold in 20 years while local government revenue has only tripled. A state assessment found a quarter of Port Phillip, including St Kilda and Port Melbourne, faces high flood risk from sea level rise. (Climate Media Centre)

Hamilton, Ontario became the first city in the Canadian province to make landlords responsible for keeping rental units cool. The new pilot bylaw requires at least one room per unit to stay below 26°C, a safety threshold recognized by Health Canada. The pilot covers downtown Ward 2, where most residents rent, and runs from 2027 through September 2028. Landlords can seek exemptions where structural or electrical barriers prevent compliance. A staff report warned the costs of the cooling mandate could lead to above-guideline rent increases. (Global News)

The Weather Company will open access to its forecasting data and meteorological briefs to more than 11,000 employers through a new partnership with the Health Action Alliance. The tie-up will equip businesses and workers with extreme weather risk data in advance of a winter season likely to be made more volatile by a strong El Niño.

The joint initiative sees The Weather Company become the official weather intelligence partner of the alliance’s Extreme Weather + Work initiative, whose founding members include Google, Disney, CVS Health, and Bristol Myers Squibb. Members will receive custom risk data and workforce resilience workshops, together with research designed to encourage businesses to incorporate weather intelligence into business continuity planning.

“Over 82% of workers have been directly impacted by extreme weather, yet very few organizations have comprehensively mapped their workforce’s exposure,” said David Leathers, director of Extreme Weather + Work at the Health Action Alliance, adding that The Weather Company partnership should help business leaders “move from reactive response to proactive resilience.”

The Weather Company’s current winter outlook shows warm temperatures this fall lasting into early winter, and pushing winter storm risks into early 2027. A sequence of storms could drench California in the coming months, raising the risk of floods and landslides. Meanwhile, warm and dry conditions in the Pacific Northwest could exacerbate drought risks and elevate the region’s wildfire risks next spring and summer.

Fire suppression start-up FireDome has opened US operations at a 600-acre demonstration site at Yuba County Airport in California, where it plans to validate its autonomous wildfire defense system ahead of commercial launch in 2027. Its stationary launchers detect emerging fires and eject capsules of retardant up to 1,000 feet, protecting up to 70 acres of terrain without the need for local water, power, or firefighting personnel. (FireDome)

The UK Space Agency awarded £500,000 (US$670,000) to seven projects leveraging satellite data to create commercial climate risk tools. Recipients include WieldMore, an investment firm that uses Earth Observation inputs to produce asset-level adaptation and resilience metrics, and Quantum Risk Solutions, which is developing a Home Horizon tool that can identify what social housing units are likely to overheat during high temperature events. (UK Space Agency)

Karen Clark & Company (KCC) has released version 5.0 of its US severe convective storm (SCS) catastrophe model. The updated tool now draws on AI-informed 4D atmospheric modeling rather than relying solely on historical storm reports, allowing for improved simulation of tornado risks and wind intensities along the Southeast coast. (Karen Clark & Company)

The Iowa Flood Center has launched an upgrade to its Iowa Flood Information System, designed by the University of Iowa to send flood early warning data to all Iowans. The updated system allows for email and text alerts and monitors real-time flood conditions for all 99 counties. It also offers flood frequency maps for 2- to 250-year events and high-resolution inundation maps for dozens of cities. (KIMT)

A radiative cooling coating developed by researchers at King Abdullah University of Science and Technology could raise the current-carrying capacity of overhead power lines by up to 18% during extreme heat events. The special polymer reflects 92% of sunlight while transferring heat away from the conductor. In outdoor tests in Saudi Arabia, coated cable ran about 5°C cooler than bare cable at midday. (Light: Science & Applications)

New Zealand’s Natural Hazards Commission is committing NZ$3.6mn (US$2mn) to eight three-year university research programs, including work on flood adaptation and coastal cliff collapse. The University of Auckland is taking the lead on five projects. One using image data from drones and computer modeling to predict coastal cliff collapses in residential areas; another is analyzing where and when managed retreat in the face of rising flood risks makes sense for communities, and crafting tools that can detail “fair and informed adaptation decisions.” (Natural Hazards Commission)

Does Nature Loss Raise Public Borrowing Costs? (Oxford Business Law Blog)

Stabilizing home insurance and enhancing wildfire resilience for existing California homes (Terner Center for Housing Innovation)

Assessing urban heatwave vulnerability through a multiscale and multicriteria GIS-based approach: Evidence from three Spanish cities (Cities)

Refined crop modelling reveals intensifying impacts of droughts and heatwaves on global wheat productivity (Nature Food)

Selecting climate solutions creates new institutional authority (Nature Climate Change)

Thanks for reading!

Louie Woodall
Editor