Democratic States Fight "Unlawful" Resilience Grants Freeze, Texas Flood Response, Climate Threat to Data Centers, and More

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Twenty Democratic attorneys general are pressing a federal court to overturn the Trump administration’s block on US$3bn of grants for local level climate resilience.

The coalition, led by New York Attorney General Letitia James, issued an amicus brief last Tuesday backing a lawsuit against the Environmental Protection Agency (EPA), which terminated hundreds of millions of dollars promised under the Environmental and Climate Justice (ECJ) Block Grant Program earlier this year. The original lawsuit was brought in June by non-profit Appalachian Voices and 22 other grant awardees.

James said the funds represent “a lifeline for communities”, and that their loss could be “devastating, even deadly” for vulnerable populations. The program was created by the Biden-era Inflation Reduction Act to finance climate- and pollution-fighting projects in disadvantaged communities. Since his appointment by President Trump, EPA Administrator Lee Zeldin has worked to eliminate the program and claw back unallocated funds.

“The States and their residents urgently need federal funding to address … environmental inequalities and help their most vulnerable residents adapt to a changing climate,” the brief reads. “Congress created and funded the … [ECJ] program specifically to help meet these needs. A preliminary injunction restoring funding pursuant to Congress’s mandate would serve the public interest and would help ameliorate the ongoing harms to the States’ most vulnerable residents from defendants’ actions.” The attorneys general argue that the EPA’s actions are hurting communities by stopping planned-for projects from going ahead, causing workers to be laid off, and undermining their ability to withstand climate disasters. 

This week, Congressional Republicans will vote on clawing back ECJ funding as part of a US$9.4bn rescission package that would also defund overseas initiatives aimed at strengthening climate resilience and adaptation.

BRICS nations have unveiled an international climate finance framework that emphasizes support for developing economies. The alliance’s declaration calls for a fairer climate finance system and criticizes carbon border taxes like those implemented by the European Union, which they say are diverting resources from development goals. The new framework includes a carbon markets partnership aimed at capacity-building across member states and a tropical forest conservation mechanism leveraging blended finance. The BRICS nations are: Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates. (BRICS Brasil 2025)

More than half of European banks have “leading practices” in place for managing at least some of their climate and nature-related risks, up from just 3% in 2022, according to the European Central Bank (ECB). However, gaps persist in coverage across portfolios, geographies, and risk categories. For example, while all banks now incorporate climate into stress testing frameworks, only one-third reflect it in capital plans, and most still fall short on integrating nature-related risks. The ECB said it would publish an updated collection of good climate practices for lenders later this year. (European Central Bank)

The UK’s budget watchdog has said the costs of not acting on climate and investing in adaptation is rising sharply. The latest Office for Budget Responsibility’s report on fiscal risks shows that climate damages under 3°C of warming could slash 8% from GDP by the 2070s — 60% more than previously estimated — and nearly double annual government borrowing due to falling productivity and tax receipts. In contrast, the cost of net-zero has halved since 2021, now expected to total just 6% of GDP through 2050. (UK Office for Budget Responsibility)

UK ministers are lobbying City of London leaders to mobilize private sector funds for climate finance and disaster risk insurance. The government has allocated £12mn (US$16mn) from a reduced aid budget to facilitate pre-arranged disaster relief financing, which is paid out rapidly following climate disasters to support recovery. (UK Government)

The Trump administration’s shake up of federal climate and emergency response agencies has come under intense scrutiny in the wake of the devastating Texas flash floods, which have claimed at least 130 lives and may end up costing US$22bn in damages.

The New York Times reports that the Federal Emergency Management Agency (FEMA) failed to answer two-thirds of calls to its disaster response line after hundreds of contract workers were let go. Documents seen by the Times show that FEMA answered 99.7% of flood victims on July 5, but that on July 6 — after the agency failed to renew the relevant call-center worker contracts — the response rate dropped to 35.8%, and to 15.9% on July 7. Homeland Security Secretary Kristi Noem said the figures were “fake news” on NBC’s Meet the Press. 

Noem also denied that a policy requiring her to sign off on any FEMA expenditure above US$100,000 had slowed the agency’s response. “Those claims are absolutely false,” she said. “Within just an hour or two after the flooding, we had resources from the Department of Homeland Security there.”

Acting FEMA David Richardson, appointed by Trump on May 8, also came under fire for failing to tour the Texas disaster zone until July 12 — more than a week after the catastrophe. The FEMA chief typically plays a leading role in the aftermath of natural catastrophes by directing federal resources and coordinating with state and local emergency responders. In a July 9 letter, Democratic lawmakers chased after Richardson’s plans to visit, and asked whether the Texas response was affected by President Trump’s reported plan to phase out FEMA following this hurricane season.

Trump has previously called for states to be weaned off FEMA support, and to be provided instead with direct payments from the federal government to assist with catastrophe management. Speaking at the Turning Point Action conference on Saturday, Secretary Noem said disaster response “should be state managed” with the federal government providing “support.”

Research suggesting that the Texas floods were supercharged by climate change has also underscored the risks posed by Trump-directed staffing cuts at the National Oceanic and Atmospheric Administration (NOAA) and the National Weather Service. Current budget proposals threaten to close key research labs, such as the National Severe Storms Laboratory, which has been making advances in flash flood forecasting tools like the FLASH system.

The International Court of Justice (ICJ) will deliver a much-anticipated advisory opinion on states’ legal obligations to address climate change and their potential liability for climate-related harms on July 23. The case asks whether nations must protect the climate for current and future generations, and what legal consequences they face if they don’t. While non-binding, the opinion is expected to shape the future of climate litigation and international policymaking. (Reuters)

The Inter-American Court of Human Rights has established the human right to a healthy climate, in an advisory opinion that could shape future litigation on adaptation and decarbonization. The opinion obligates states to regulate high-emitting industries and combat climate disinformation, efforts that could force corporations to rewrite policies and alter their practices. (IACtHR)

President Trump’s pick to lead NOAA, Neil Jacobs, promised to fully staff the National Weather Service amid mounting backlash over federal cuts, which have been blamed for hampering storm warnings during the deadly Texas floods. Testifying before the Senate, Jacobs backed Trump’s US$2.2bn proposed budget reduction and elimination of over 2,000 NOAA roles, while also calling for public-private partnerships to modernize weather modeling. (Politico)

California Governor Gavin Newsom issued an executive order to expedite rebuilding efforts in areas of Los Angeles affected by January’s wildfires. The orders suspend local permitting laws and building codes, which critics say could allow less resilient, and more carbon-intensive, homes to be built in the scorched neighborhoods. (Governor of California)

The UK government has released an updated resilience action plan that prepares for the possibility of nationwide power blackouts, citing the near-daylong grid collapse that plunged Spain and Portugal into darkness earlier this year. The plan takes lessons from recent disruptions, like Storm Éowyn and the Iberian grid failure, and calls on households, businesses, and local authorities to step up their preparedness. (UK Government)

New Zealand’s Ministry for the Environment has published an expert report on overhauling the country’s climate adaptation framework. Written by independent professionals from local government, Māori governance, insurance, and finance, it recommends making hazard data widely accessible, aligning property values and insurance costs with climate risks, and decoupling disaster relief from property values, among other things. Moreover, the report says property buyouts — used to compensate owners affected by natural hazards — should be phased out over time, as they “reduce incentives for people to understand and manage their own risk can distort property prices, and have given rise to an expectation that buyouts will continue, creating a moral hazard.” (NZ Ministry for the Environment)

The Global Center on Adaptation (GCA) has broken ground on a new headquarters in Nairobi, which will serve as a regional hub for scaling finance, mainstreaming resilience across African development plans, and training public and private sector leaders through its Capacity-Building Academy. The facility is set to be completed by 2027. The GCA is an international organization that champions climate adaptation, and is funded by an array of philanthropies and government entities including the Gates Foundation, UK International Development, and the Netherlands’ Ministry of Foreign Affairs. (Global Center on Adaptation)

Over one-fifth of data centers are at risk from extreme heat, floods, wildfires and other extreme weather hazards absent adaptation, analysis by climate intelligence company XDI shows.

This share is projected to grow to almost 27% by 2050, with hubs like New Jersey, Tokyo, Shanghai, and Hamburg expected to become particularly vulnerable. In Shanghai alone, 49% of data centers are estimated to be at high risk, and another 49% at moderate risk. 

XDI’s analysis spanned nearly 9,000 operational and planned sites worldwide. Risks to each center were calculated under a high emissions scenario, known as RCP 8.5, which projects warming of over 4°C by 2100 — an extreme potential outcome. XDI said it is “an appropriate scenario to use in a prudent risk assessment.” The company used a “standard base archetype”, drawing on typical design specifications and construction materials, to estimate the exposure and vulnerability of each data center.

This allowed XDI to model the benefits of adaptation actions in a comparable way. Structural adjustments — such as improved elevation, cooling systems, and waterproofing — could reduce the number of high-risk data centers by more than two-thirds by 2050, and lower damage to data infrastructure by 74%. XDI estimates that an outlay of 3% of total asset value by the data center industry could bring a positive return on investment through avoided losses and reduced damage. However, the analysis stresses that resilience varies widely even within countries.

XDI’s modeling also shows that no data center is secure without resilient supporting infrastructure, such as roads, power stations, water, and communications. These assets also need to be climate-proofed if the data center industry is to be made secure. 

Geospatial intelligence company ICEYE has announced Flood Rapid Impact (FRI), a new monitoring tool for flood events. The product leverage ICEYE’s synthetic aperture radar constellation of satellites and machine learning analytics to offer continuous, near-real-time coverage of deluges worldwide, enabling emergency managers, insurers, and utilities to assess damage, prioritize responses, and estimate losses at speed. (ICEYE)

Professional services firm PwC warns that by 2035, 32% of global semiconductor production could be jeopardized due to climate-induced disruptions in copper supply, escalating to 58% by 2050 if current emissions levels persist. Copper mines face severe drought risks, especially in Chile, putting pressure on the semiconductor industry to adapt and diversify its supply chains. Companies are already investing in water security and exploring alternative materials to mitigate risks, PwC says. (PwC)

Sustainability tech company Clarity AI has acquired ecolytiq, a fintech specializing in real-time climate engagement tools for banks and their customers. The company runs a platform that analyzes transaction data in real time to quantify their environmental impacts, data which is used by banks and financial institutions to encourage their customers to engage in climate-positive actions. As part of the deal, payments giant Visa — an ecolytiq strategic partner — has become an investor in, and partner of, Clarity AI, too. (Clarity AI)

The International Atomic Energy Agency (IAEA) is advancing a new project to standardize gamma-ray spectrometry (GRS) for detailed soil analysis, which could assist with sustainable land management. By integrating GRS with digital and remote sensing technologies, the initiative aims to deliver high-resolution soil maps to optimize resource efficiency and preserve soil health. Unlocking this technology presents significant opportunities for policymakers and corporate leaders to enhance agricultural productivity while reducing environmental impacts. (IAEA)

How temperature changes affect risk attitudes: Evidence from 1,708 farming households in China (Science of The Total Environment)

Climate change in your backyard: the role of local governments (npj Urban Sustainability)

Climate change risks on key open marine and coastal mediterranean ecosystems (Scientific Reports)

Accelerating increase in the duration of heatwaves under global warming (Nature Geoscience)

High-frequency data reveal limits of adaptation to heat in animal agriculture (Science Advances)

Projections of heat related mortality under combined climate and socioeconomic adaptation scenarios for England and Wales (PLOS Climate)

Incorporating physical climate risks into banks' credit risk models (Bank for International Settlements)

Thanks for reading!

Louie Woodall
Editor