1. The Biggest, Busiest, yet Quietest New York Climate Week to Date

This year saw more closed door-events where participants could speak openly about the challenges and opportunities they face. Whilst the volume and attendance of events was the highest ever, media coverage was largely limited to specialist ESG press.

Investment banks in attendance spoke to very strong US renewable project finance pipelines, suggesting that despite negative sentiment, capital continues to flow to low-carbon technologies.

2.  The Focus Has Shifted Towards Practical Solutions to Real Risks

In contrast to many policy-focused discussions at London Climate Week, the focus of many events was on tools and analytics to support identification and management of climate risk by companies and investors.

Whilst still imperfect, investors, lenders and insurers pointed to the growing value of physical risk modelling for internal research and decision-making. Similarly, tools for estimating climate impacts of products and services were seen to be improving, and providing practical value beyond reporting. 

Many sessions focused on the applications of AI to physical climate risk assessment as well as transition risks – with potential benefits of lowering operating costs as well as optimising energy use and supply chains for companies and real assets.

There appears to be a growing consensus that investors are unwilling to sacrifice returns for impact, so will naturally focus on projects that can deliver attractive short-term returns alongside risk mitigation.

3. Physical Risks Are Taking Hold – and Investor Interest in Adaptation Is Rising

Senior leaders from the investment and banking sectors spoke publicly and privately at the scale of disruption emerging from physical risks and the retreat of insurance from key real estate and infrastructure markets. Physical risk was seen by many to be widely mispriced, and states could be expected to shoulder a growing share of the burden of disaster recovery from floods, wildfires and other extreme weather events.

At the same time, many asset owners pointed to this mispricing - and the lack of common standards around climate change adaptation - as creating opportunities for short-term value creation as well as long-term value preservation. Pointing to examples of large, public companies making investments in adaptation across smart metering, water recycling and early warning systems, many expect growing momentum for such solutions as physical risks increase.

The perception of adaptation as being limited to public policy or investment in specialist private companies appears to be weakening.

4. Rising Electricity Costs – and Battery Breakthroughs – Could Create Tailwinds for Renewables

The rapid expansion of data centres, growing adoption of electric vehicles, cooling needs and increasing grid and supply chain costs are projected to lead to sharp increases in US electricity costs in 2026. Breakthroughs in battery chemistry and manufacturing costs have spurred record growth in utility-scale battery storage in key markets such as California and Texas in the past year, and as data centre expansion is held back by grid and planning restrictions, off-grid renewables plus storage look increasingly attractive.

Battery technology and grid flexibility will play a growing role for businesses and households, with AI and digital twins enabling smart demand management as electricity costs become a material concern.

5. Opportunities Beyond the US Are on the Horizon of Many Asset Owners

Technology maturity, higher growth forecasts and supportive policy frameworks are spurring growing asset owner interest in opportunities in the low-carbon transition beyond the USA. Across emerging markets such as Indonesia, as well as developed markets such as Japan, opportunities are growing for decarbonisation alongside strong potential returns in renewables, battery technologies and green real estate. Many investors cited the scale of these opportunities as prompting them to look again at markets that had previously been disregarded. 

The growth of private credit within asset owner allocations is also leading many to explore opportunities in the low-carbon technology space outside of the US.