Hurricane Beryl's Financial Toll, FEMA's Flood Resilience Rule, Water Tech Investment, and More

Today in Climate Proof:

Finance:

• Hurricane Beryl Spurs Climate Finance Demands

• The Other Climate Adaptation Bond

Policy:

• FEMA Enacts Flood Resilience Rule

• NATO Eyes Climate Threats to Itself and Potential Foes

Tech:

• Adaptation-Focused Investor Commits US$100mn to Water Tech and Infra Company

Research:

• Another round-up of papers and journal articles on all things climate adaptation

Hurricane Beryl Spurs Climate Finance Demands

The leaders of Caribbean island nations hit by Hurricane Beryl have called on the international community to provide more finance to help them rebuild and increase resilience against future climate shocks.

Beryl, the first storm of the Atlantic hurricane season and the earliest on record to strengthen to a Category 5, swept through Grenada and St. Vincent and the Grenadines (SVG) on July 1,  before advancing in a weakened state to the Gulf of Mexico and Texas.

Dickon Mitchell, prime minister of Grenada, said on several islands around 90% of all homes were destroyed. “There is no economy,” he said. “We will have to feed the population for the next six months.”

At a press briefing, SVG prime minister Ralph Gonsalves said “There is nothing there, really” of those parts of his country battered by the storm. “The housing, public facilities … the shoreline, the fisheries, tourism infrastructure, they are basically no more.”

The United Nations initiated a US$9mn response plan to the disaster in the Caribbean — US$5 million for Grenada and US$4 million for SVG — intended to help around 43,000 people impacted by Beryl. 

However, the two countries need hundreds of millions more to rebuild their shattered economies. Catastrophe risk modeling firm Karen Clark & Co. estimates that privately insured loss from Hurricane Beryl will be close to US$510 million in the Caribbean, US$90 million in Mexico, and US$2.7 billion in the US. Uninsured losses are likely to be much greater.

The Caribbean Catastrophe Risk Insurance Facility (CCRIF), a dedicated risk pool developed by the World Bank, has said US$44mn would be paid out from its fund to the government of Grenada — its largest-ever single disbursement.

Mitchell said the payouts represented just a “drop” of what is needed. He also railed against the notion that Grenada would have to pay rebuild by increasing its debt:

“We are no longer prepared to accept that it is OK for us to constantly suffer significant clear, demonstrated loss and damage arising from climatic events and be expected to borrow to rebuild year after year while the countries that are responsible for creating, exacerbating the situation sit idly with platitudes and tokenism,” he said at a press conference.

The Other Climate Adaptation Bond

The City of San Francisco is slated to issue almost US$1 billion in green bonds later this week to improve and strengthen the climate resilience of its wastewater and stormwater systems. 

The proceeds will finance projects that are part of the city’s Sewer System Improvement Program, including wastewater treatment, sewer collection improvement, and stormwater management, among others. 

San Francisco Public Utilities Commission, the bond issuer, provides drinking water to 2.7 million people in the San Francisco Bay Area, collects and treats wastewater for the City and County of San Francisco, and generates clean power for municipal buildings, residential customers, and businesses.

The securities have been certified by the Climate Bonds Initiative (CBI), a nonprofit that creates standards and frameworks for environmentally friendly investments. The bonds will be sold in two tranches of roughly the same size. The 2024A Wastewater Revenue Bonds are certified green and are federally taxable, while the 2024C Wastewater Revenue Bonds are green and tax-exempt. Both tranches have received investment-grade ratings by major credit rating agencies. 

The CBI says the taxable bonds “present a significant opportunity to attract new investors and increase demand for the bonds.” Such bonds can be purchased by a wider range of investors, including international buyers.

The San Francisco issuance follows the approval of a US$10bn climate adaptation bond by California lawmakers, which will be voted on by state residents this November.

Other Stuff

Philippines chosen to host climate ‘loss and damage’ fund board (Reuters)

Biden-Harris administration invests US$120mn to help tribes build climate resilience (Department of the Interior)

North Sky Capital raises US$250mn impact secondaries funds to invest in energy transition, climatech, circular economy and healthy living sectors (North Sky Capital)

Scenarios for assessing climate-related risks: new short-term scenario narratives (UNEP FI)

Adapting central bank operations to a hotter world: current progress and insights from practical examples (Network for Greening the Financial System)

California Department of Transportation awards US$51.4mn for sustainable transportation projects to strengthen California’s climate resilience (CA.gov)

Texas Climate-Smart Initiative announces incentives for landowners (Agrilife Today)

Rwanda and Italy sign €50mn financing agreement to support Rwanda’s National Climate Action Plan (Further Africa)

Development banks get ratings boost on climate clauses and hybrid bonds (Reuters)

Wellcome Trust and Rockefeller Foundation seek supplier to set up and coordinate a Climate and Health (C&H) funders’ coalition (Wellcome)

FEMA Enacts Flood Resilience Rule

The US Federal Emergency Management Agency (FEMA) will take into account future climate-driven flood risks when rebuilding schools, hospitals, and other public infrastructure following natural catastrophes.

The Federal Flood Risk Management Standard (FFRMS), published on July 10, requires that construction projects paid for out of FEMA funds must be built to withstand or avoid flood risks — both now and in the future, when climate change could make inundations more frequent and severe. 

In recent years, repeated flooding has imperiled both lives and property, revealing the shortcomings of historical flood risk data. The FFRMS uses up-to-date science to better identify what areas are vulnerable to flooding. The rule expands the definition of “floodplain” to account for the increased height and width of floods expected in the near future, with the idea being that fewer taxpayer-financed buildings will be washed away once rebuilit.

FEMA Administrator Deanne Criswell said: “FFRMS will allow us to enhance resilience in flood-prone communities by taking future flood risk into consideration when we rebuild structures post-disaster.” 

The rule enters into effect September 9.

NATO Eyes Climate Threats to Itself and Potential Foes

NATO has a monumental adversary to contend with. And I’m not talking about Russia. Or the former US President.

In a new report, the military alliance said climate change could have “a profound impact” on its members’ security, while challenging its potential enemies and strategic competitors, too.

The third edition of NATO’s Climate Change and Security Impact Assessment highlights climate-related risks to the alliance’s bases, infrastructure, and military hardware, and describes how a warmer world could transform the strategic environment in which it operates. For example, the report underscores how bases in northernmost latitudes could be damaged by permafrost thaw, while those in low-lying areas in Europe are at risk of flooding.

Military assets could also be impaired. The report looks at how changes to the oceans prompted by global warming could affect the performance of submarines, in particular the operation of underwater sonar. The behavior of aircraft could also be impacted by a hotter climate. A study referenced in the report reveals that on “hot days”, when air temperatures exceed 40°C, naval helicopters have reduced lifting capacity, meaning they can’t transport as much fuel, personnel, weapons, or equipment as on cooler days. Climate change is expected to lead to many more such hot days.

When it comes to NATO’s adversaries and their climate-related risks, the report notes that Russia faces challenges from “permafrost thaw, increased flooding, prolonged droughts and heatwaves,” which could elevate social and political tensions. These in turn could affect the country’s foreign and security policy decision making, the report says. As for China, NATO says a hotter climate could not only trouble the country itself, but food security for the world at large given its importance as a producer of foodstuffs and as a key trading power.

“No region of the world or operational domain will be untouched by climate change,” writes Jens Stoltenberg, NATO Secretary General, in the report’s foreword. “NATO remains determined in its collective ambition to better understand, adapt to, and mitigate the effects of climate change on Allied security.”

Other Stuff

Scientists relieved by far-right defeat in French election — but they still face uncertainty (Nature)

New Zealand government unveils new climate strategy (NZ Ministry for the Environment)

Republicans urge reversal of landmark ruling in Montana climate change lawsuit by young plaintiffs (AP)

Agriculture spending bills must address broad demand for research and conservation programs (National Sustainable Agriculture Coalition)

Vermont Climate Council seeks input to revise state’s Climate Action Plan (WAMC)

Adaptation-Focused Investor Commits US$100mn to Water Tech and Infra Company

Upwell Water, a tech-powered water resource and infrastructure company based in San Francisco, has made a splash with the deep-pocketed investor Climate Adaptive Infrastructure (CAI).

Last week, the infrastructure investment firm announced a US$100mn equity investment in the company aimed at supporting and scaling Upwell Water’s water and wastewater utility platform.

Upwell Water is an offshoot of Upwell LLC, a self-described platform for “purpose-driven businesses” in data, technology investment, and renewable energy. Upwell Water is a developer, owner, and operator of water supply, treatment, and utility assets around the world, using technology to inform system upgrades and to ensure they have the expertise and capital needed to thrive. 

CAI’s equity injection is intended to support the “sustainable management of water resources in structurally water-deficient or under-resourced areas.”

CAI raised US$1bn in 2022 to invest in “large-scale, low-carbon real assets in the clean energy, water, and urban infrastructure sector.” It was founded in 2019 by Bill Green, formerly the CEO of financial institution Macquarie’s Renewable Energy Holdings.

Other Stuff

How cities can use AI to adapt to climate change (phys.org)

US Health & Health Tracker (cdc.gov)

Newlab at Michigan central surpasses 100 startups in its first 14 month, including climate tech (Michigan Central)

Horizon Europe funded PROVIDE project present new findings on future impacts of climate change (Climate Analytics)

RESEARCH

Looming deadlines for coastal resilience: rising seas, disruptive tides, and risks to coastal infrastructure (Union of Concerned Scientists)

Nature-based solutions for comprehensive disaster and climate risk management: toolkit for integrated planning and implementation of disaster risk reduction and climate change adaptation (United Nations Office for Disaster Risk Reduction)

An introduction to assessing climate resilience in smallholder supply chains (USAID)

Avoiding gridlock: The Impact of climate on electric grids (Swiss Re Institute)

Back to the future: heritage-centric approaches to climate resilience (Cities Alliance)

The cost of climate resilience: future proofing UK dairy (Kite Consulting)

Beyond sustainability: The power of indigenous healthy energy homes (Canadian Climate Institute)

Thanks for reading!

Louie Woodall
Editor