Climate Superfund Fight, UN Warning on Heat Stress, Chicago's New Flood Sensors, and More

Non-profit organizations are defending Vermont from a wave of lawsuits targeting its landmark Climate Superfund Act, which could raise billions for state-wide adaptation and resilience projects.

The Trump administration, US Chamber of Commerce, American Petroleum Institute, and 24 Republican-led states are seeking to gut the law, which came into effect last year, claiming it pre-empts federal jurisdiction over the regulation of greenhouse gas emissions and unfairly penalizes fossil fuel companies.

But in a motion to dismiss filed last Friday, two advocacy groups — Conservation Law Foundation (CLF) and Northeast Organic Farming Association of Vermont (NOFA-VT) — called this narrative “false”, arguing instead that the Superfund represents a legal effort by the state to raise revenue and protect the health, safety, and well-being of its residents.

“Our community has been enormously impacted by the climate crisis,” said Grace Oedel, NOFA-VT’s Executive Director. “This law helps Vermonters deal with the fallout by funding critical climate adaptation projects, and we are committed to defending this law that will help so many of our farmers and community members navigate these extreme challenges,” she added.

The non-profits’ intervention follows Vermont’s own motion to dismiss, filed on August 15, which argues the law does not seek to regulate oil and gas majors’ emissions, but simply make them pay for climate damages.

The first-of-a-kind act would force companies including ExxonMobil, Chevron, and ConocoPhillips to pay for climate damages in proportion with the emissions they released between 1995 and 2024. The funds generated would be handed out by Vermont’s Agency of Natural Resources to build climate-resilient infrastructure, protect buildings from extreme weather shocks, and invest in preventive health care for climate change-induced illnesses, among other things. Recovery demands to oil and gas companies would be issued by July 1, 2028, if the law survives legal challenges.

New York passed its own Climate Superfund law at the end of last year, and is facing a similar flurry of lawsuits from the federal government and petroleum interests. Under the New York plan, fossil fuel companies could pay up to US$75bn over 25 years for “climate change adaptive infrastructure projects.” As with Vermont, non-profit groups — including Food & Water Watch — are maneuvering to defend the New York law from legal challenges.

A coalition of 16 Democratic state financial officers overseeing more than US$3trn in pension assets is urging the asset manager BlackRock to strengthen its oversight of climate-related financial risks, warning that a rollback of its stewardship efforts threatens the security of retirees. In a letter led by Maryland Comptroller Brooke Lierman, the group rebukes the Republican-led State Financial Officers Foundation’s call for passive investment oversight, calling it “reckless” for encouraging investment managers to ignore material climate, governance, and supply chain risks. The coalition is pressing BlackRock CEO Larry Fink to reaffirm commitments to responsible stewardship, expand proxy voting, and develop stronger tools for connecting capital to climate risk oversight ahead of a September 1 response deadline. (Comptroller of Maryland)

Canada’s federal government announced a CAD$5.2mn (US$3.8mn) investment in 70 adaptation projects nationwide. The funding is part of the Green Municipal Fund’s Local Leadership for Climate Adaptation initiative and will finance climate risk assessments, adaptation plans, and climate-focused asset management strategies. (Government of Canada)

South African banks are already pulling back on lending as climate risks mount, according to a new South African Reserve Bank working paper. Using data from 38 institutions between 2008 and 2024, researchers found that both physical risks, such as extreme weather, and decarbonization risks, like a carbon tax, curb loan growth, especially to non-financial firms. Commercial banks proved the most sensitive, and were found to cut overdrafts to companies more sharply than mortgages in the face of escalating physical risks. The study also exhibited a U-shaped effect: lending initially rises under manageable climate risks, but falls steeply once risks intensify. The authors warn that reduced credit supply could choke investment in adaptation and climate mitigation at the moment it is most needed, and press regulators to build climate stress tests and targeted green credit policies to keep finance flowing. (South African Reserve Bank)

Fiji is set to pilot parametric insurance for micro, small, and medium-sized enterprises (MSMEs) as part of a US$950,000 initiative led by the Asian Development Bank and two UN agencies. The project, backed by the Asia-Pacific Climate Finance Fund, will work with local insurers to design financial products that deliver rapid, pre-agreed payouts when climate thresholds — such as rainfall or wind speeds — are breached. MSMEs make up more than 80% of Fijian businesses and account for more than one-quarter of the workforce, but are highly vulnerable to climate shocks given the country’s exposure to extreme weather. (Asian Development Bank)

The International Finance Corporation has made its first blue financing investment in Asia-Pacific infrastructure, subscribing to a 620-million-baht (US$19mn) blue bond issued by Thailand’s East Water to bolster water security in the country’s Eastern Economic Corridor. Proceeds will help maintain East Water’s 553 km transmission network, which is the longest in the country, and ensure reliable supply for households and industries in the region. The IFC says the deal aligns with its global Blue Finance Guidelines and broader efforts to expand investment in water management and ocean preservation. (International Finance Corporation)

Rising global temperatures could sharply undermine productivity and worker safety unless governments and businesses accelerate adaptation measures, according to a new report from the World Meteorological Organization and World Health Organization. 

The study warns that climate-driven heat stress is becoming a major global economic and health crisis, threatening billions of workers and undermining productivity. It finds that worker output drops 2–3% for every degree above 20°C, with agriculture, construction, and fisheries among the hardest-hit sectors. Occupations involving moderate-intensity effort in the hottest countries could see an 8-11% loss of work hours, up from 2-4% today.

To address these risks, the agencies call on policymakers to work with scientists, meteorological services, health service providers, and employers on a raft of preventative and risk-reducing measures, including revised work-rest schedules, improved ventilation and cooling infrastructure, and investment in early warning systems. These are seen as essential for protecting livelihoods and reducing the rising burden of heat-related illness and injury.

“Occupational heat stress has become a global societal challenge, which is no longer confined to countries located close to the equator — as highlighted by the recent heatwave in Europe,” said Ko Barrett, WMO Deputy Secretary-General. “Protection of workers from extreme heat is not just a health imperative but an economic necessity.”

Europe’s summer heatwave may reduce the continent’s economic output by half a percentage point, according to analysis by insurer Allianz, with losses ranging from 0.1 percentage points for Germany to as high as 1.4 percentage points for Spain.

Democratic state governors and attorneys general are suing the US Department of Energy (DOE) to block a new policy that caps reimbursement costs tied to state-run energy programs. Led by New York, Minnesota, and Colorado, the lawsuit argues the 10% federal payback limit, announced in May, violates a law requiring DOE to honor previously negotiated rates. The reimbursement cap threatens funding for grid resilience, energy efficiency, and affordability initiatives, the complaint argues. Washington state officials warned the cap could force delays to wildfire mitigation planning, and essential infrastructure protection, among other things. (Washington State Office of the Attorney General)

The EU has pledged to “undertake efforts” so that its flagship sustainability disclosure and due diligence laws will “not create undue barriers to transatlantic trade”. In a joint statement with the US, the bloc commits to ensure that the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD) do not crimp US businesses by adding administrative burdens. (European Commission)

Germany’s national Court of Auditors has warned the government to tighten rules around its €500bn (US$580bn) special fund for infrastructure and climate neutrality, calling for a narrow definition of eligible investments and clearer targets. In a letter to the parliament’s budget committee, the auditors said the fund should finance only “real investments”, and scrub out operating costs like wages. They also pressed for mechanisms to ensure spending is additional to existing infrastructure initiatives. (Table Media)

Independent Australian MP Zali Steggall has introduced a bill to force the Labor government to mandate five-yearly climate risk assessments and fully fund national adaptation plans. The move comes as the Albanese administration delays its one-off climate risk report, despite extreme weather already costing the economy AUS$38bn (US$25bn) a year. The legislation would embed climate risk into federal budgeting, require annual progress reports, and ensure new laws support resilience goals. (Zali Steggall)

Chicago has 50 new floodwater sensors to protect the city from urban flooding risks thanks to a tie-up between telecoms giant Verizon, tech start-up Hyfi, and the non-profit Center for Neighborhood Technology.

Hyfi’s solar-powered devices — strategically placed throughout the city’s flood-prone regions — continuously relay data on water levels to the company, which in turn supplies a real-time map of flood conditions to users via its web-based app. The tech enables location-specific early warnings of flood events, allowing local authorities to alert residents and put in place risk reduction measures. Emergency responders can also use the data to dispatch rescue and repair crews to problem areas while avoiding blocked routes.

In the near future, a Hyfi app will be made available to local residents so they can monitor their own flood risks. “By delivering real-time insights into neighborhood flooding and the underlying causes, we’re focused on helping crews and communities get ahead of floods — up to an hour before a flood hits,” said Brandon Wong, CEO of Hyfi.

The sensors are wireless, and operate on Verizon’s 5G network. The Chicago rollout follows a pilot program in New Orleans last year funded by the telecoms company, which provided useful data during Hurricane Francine. 

Hyfi is now part of the Verizon Frontline Innovation Program, designed to enhance emergency response, preparedness, and risk reduction efforts in communities across the country. Bloomberg reports that Verizon is working on deploying the sensors in Detroit within the year.

Japanese IT company NEC Corporation and San Francisco’s ClimateAi have partnered to develop an AI-driven model that can judge the effectiveness of climate change adaptation measures for cocoa and rice cultivation in Africa. The model evaluates irrigation, climate-adapted varieties, and planting schedule changes, and determines their ability to maintain and boost crop yields amidst a changing climate. The end goal is to estimate the ROI of different adaptation measures to inform capital allocation by finance providers and other stakeholders. (NEC Corporation)

Agtech company Pivot Bio has entered a strategic partnership with the Soil and Water Outcomes Fund (SWOF) to scale sustainable farming practices across Indiana and Illinois. The deal links Pivot Bio’s gene-edited nitrogen-fixing products with SWOF’s outcomes-based payments, enabling farmers to cut synthetic fertilizer use, curb greenhouse gas emissions and nitrogen runoff, and potentially boost yields. (Pivot Bio)

Food giant Nestlé is pioneering a chocolate-making technique that uses up to 30% more of the cocoa fruit, aiming to boost farmer yields and cut waste without compromising taste. Instead of discarding pulp, placenta, and husk, the process ferments the entire pod mass before grinding and roasting it into chocolate flakes. The innovation could help farmers extract more value from each harvest and free up time for yield-boosting practices like pruning. Nestlé says the pilot-stage method could offer a scalable way to improve supply resilience. (Nestlé)

Climate risks and corporate leverage (International Review of Financial Analysis)

Climate variability amplifies the need for vector-borne disease outbreak preparedness (PNAS)

Backcasting — a scenario approach in urban climate adaptation planning (npj Urban Sustainability)

Measuring flood underinsurance in the USA (Nature Climate Change)

The mitigating effects of urban resilience on surface urban heat islands: Nonlinear responses, threshold effects, and spatial heterogeneity (Sustainable Cities and Society)

From words to deeds: Incorporating climate risks into sovereign credit ratings (Centre for Economic Policy Research)

Thanks for reading!

Louie Woodall
Editor