The EU Framework for Climate Resilience

Why now? 

The Commission calls the summer of 2026 the „summer of truth.” Wildfires covered approximately 700,000 hectares, and water levels in the Danube, Rhine, and Garonne fell to critically low levels, disrupting transportation and energy security. Over the past four years, the EU’s economic losses related to extreme weather events have amounted to approximately 50 billion euros annually. In the 1980s, this figure was 8.6 billion euros. The Commission estimates that investment needs for adaptation amount to approximately 70 billion euros annually and notes that every euro invested can yield a return of 2 to 10 times that amount in the form of avoided losses. 

According to the Commission, some of the current measures are fragmented and too often reactive. The new framework is intended to shift this approach to one that is systemic and proactive. 

Key Elements of the Climate Resilience Act 

The draft legislation (COM(2026) 730) aims to simplify and harmonize the way the EU and its member states manage climate risks. In it, the Commission proposes six measures: 

• Reference thermal insulation path. A temperature increase of 1.5°C by 2030 was adopted as a reference point, 2°C by 2050, and 3°C by 2100, relative to pre-industrial levels. This is intended to serve as the baseline for decisions regarding policies, assets, and investments. 

• Identification of the parties responsible for the risk. For each policy area and each level of government, it will be necessary to clearly define who is responsible for climate risk management. 

• Regular and comparable risk assessments. National assessments and the European Climate Risk Assessment are to be consistent and synchronized. 

• Encouragement to Take Risks into Account When Carrying Out Public Tasks, particularly in budgeting, land-use planning, and regulatory impact assessments. 

• One national strategic plan. It will replace the four current planning instruments. At the EU level, the existing adaptation strategy will be replaced by an EU strategic plan, scheduled for the third quarter of 2028. 

• Easier progress tracking actions to promote climate resilience. 

The Commission announces that it will begin applying the approach outlined in the draft legislation immediately. 

Online Tools and Support for Regions 

Many decision-makers, businesses, and residents lack reliable and user-friendly information on climate risks. That is why the draft legislation is accompanied by online tools and support for regions and cities home to approximately 75% of the EU’s population: 

• European Climate Viewer – an interactive map of projected climate hazards based on Copernicus C3S data. 

• Navigator of Climate Resilience Tools – helps you choose the right tools based on the location, sector, and type of hazard. 

• Solutions Explorer – a database of implemented adaptation measures, including information on their funding and the potential for replication. 

• New European Climate Resilience Platform, which will gradually replace the Climate-ADAPT website. 

• List of the 100 Most Vulnerable Territories in Europe and an assessment of the appropriate level at which their risks should be managed. 

• Law Implementation Plan, which the Commission will present within six months of its adoption. 

Business Opportunities 

The global market for adaptation solutions is projected to reach approximately 3.5 trillion euros by 2050. The Commission wants the EU to become a leader in this market. To that end, it plans to: 

• the introduction of climate resilience as a quality criterion in public procurement, as provided for in the draft of the new regulation (which accounts for approximately 14% of the EU’s GDP) 

• convening an industry dialogue in 2027 focused on resilience technologies, 

• support for bringing innovations to market through the Horizon Europe and EIC programs, 

• work on European standards that take climate risks into account. 

Financing and Insurance 

The framework is intended to help mobilize public and private funds for climate resilience and reduce the insurance gap. Key announcements: 

• Review and promote tax incentives, such as tax credits and accelerated depreciation for investments that enhance resilience. 

• State aid will become easier to obtain following the revision of the GBER regulation, expected in early 2027. 

• Multiannual Financial Framework 2028–2034: According to the Commission’s proposal, spending on adaptation will count toward the climate and environment target of at least 35% of the budget. 

• The revised delegated acts of the EU Taxonomy are intended to facilitate the identification and financing of investments in resilience. 

• Physical climate risks are to be better reflected in asset valuation and financial reporting. 

• The EIB will allocate at least 30 billion euros for adaptation between 2026 and 2030. 

• To date, only about 25% of losses from natural disasters have been insured. The Commission will establish the Climate Insurance Alliance, which will present measures to close this gap by the end of 2027. 

Next Steps 

The Commission announced further initiatives: a European Heat Wave Plan, a European Water Initiative, the PreparEU advisory group on disaster preparedness, and an action plan for energy-efficient cooling and heating (2027). 

What does this mean for businesses? 

These frameworks are changing the context in which companies assess climate risks. The reference warming pathway will become a benchmark for public administration and, indirectly, for the financial market as well. It is therefore worth checking now whether risk analysis physical and scenario-based resilience analysis conducted for the purposes of reporting in accordance with ESRS E1 or EU Taxonomy are based on similar assumptions. Climate resilience is having an increasingly significant impact on access to financing, insurance costs, and chances of success in public tenders.