Climate and environmental (CE) risks (CER) to our economy and society are accelerating. CER include climate-related physical risks such as floods, storms, or changing growing seasons; climate-related transition risks such as carbon pricing and climate litigation; and environmental risks such as biodiversity loss. It is now well accepted that CER can impact asset values across multiple sectors and pose a threat to the solvency of financial institutions (FIs). This can cause cascading effects with the potential to undermine financial stability. The adoption of CER analytics will ensure that CE risks can be properly measured, priced, and managed by individual FIs and across the financial system. This is also a necessary condition to ensure that capital is allocated by FIs towards technologies, infrastructure, and business models that lower CER, which are also those required to deliver the net zero carbon transition, climate resilience, and sustainable development. These twin tracks - greening finance and financing green - are both enabled by CER analytics being appropriately used by FIs. The UK is a world-leader in Green Finance (GF). UK FIs have played a key role in GF innovation. Yet, despite these advances and leadership in almost every aspect of GF, UK FIs cannot secure the data and analytics needed to properly measure and manage their exposures to CER. While the last decade has seen the exponential growth of CE data, as well as improved analytics and methods, often produced by world-leading UK science, the vast majority of this has not found its way into FI decision-making. Our vision for CERAF is to establish a new national centre to resolve this disconnect. CERAF aims to enable a step-change in the provision and accessibility of data, analytics, and guidance and accelerate the integration of CER into products and decisions by FIs to manage CER risks and drive efficient and sustainable investment decisions, thereby delivering the following impacts: - Enhance the solvency of individual FIs in the UK and globally and so contribute to the resilience of the global financial system as a whole for all, as well the efficient pricing and reallocation of capital away from assets at risk to those that are more resilient. - Underpin the development and the growth of UK GF-related products and services. - Enable a vibrant ecosystem of UK enterprises providing CER analytics and realise the opportunity for UK plc of being a world-leader in the creation and provision of CER services. Our vision is that CERAF will be the nucleus of a new national centre established to deliver world-leading research, information, and innovation to systematically accelerate the adoption and use of CER data and analytics by FIs and to unlock opportunities for the UK to lead internationally in delivering CER services to support advancements in greening finance and financing green globally It aims to overcome the following barriers: 1) Making existing data on hazards, vulnerabilities, and exposures more accessible and useable for FIs, with clearly communicated confidence and with analytics that does not yet exist being secured; 2) Consistency and standards to reduce fragmentation, facilitate innovative products and enable the efficient flow and use of data; 3) Assurance and suitability are needed to understand which CER analytics are best suited for particular uses and provide transparency into underlying data and methodologies, so that CER analytics can be trusted and used; 4) Unlocking innovation through supporting FIs to test new approaches in a lower-risk way; and 5) Building capability, knowledge, and skills within FIs to analyse and interpret CER data. Resolving these barriers is a necessary condition for repricing capital and avoiding its misallocation, and achieving the UK's ambitions on GF.

In wintertime, infrastructure in Great Britain (GB) is threatened by multiple significant meteorological hazards, and it is increasingly apparent that these interact in a complex yet poorly studied multi-hazard system (e.g. Hillier et al, 2020). For example, the impacts of the dramatic February 2022 storm sequence (Dudley, Eunice, Franklin) demonstrated the pressing need for a more sophisticated view of GB's multi-hazard risk. The high windspeeds of Eunice left over 1 million homes without power and caused major transport disruption (trains and flights cancelled, roads blocked) in southern England, with snow causing further disruption in Scotland and northern England. Persistent heavy rain then resulted in the flooding of >400 homes during Franklin. In addition, there was ~£3 billion in direct insurance damage, road closures due to landslips (e.g. A57 'snake pass', Derbyshire, closed for 1 month) and other societal impacts in GB (e.g. school and port closures, trees felled). The impacts underlined the need to properly account for severe episodes that might (i) encompass a number of storms, (ii) span many days, and (iii) present a variety of hazards that manifest in different locations and affect various critical systems of UK plc (e.g. infrastructure). This contrasts to current practice where GB's hydro-meteorological hazards (related to wind and rain) are almost always considered separately (e.g. the UK's Climate Change Risk Assessment very much places single weather risks into siloes). There is some grouping for convenience (e.g. risks to transport from high and low temperatures), and the related issue of cascading failure is discussed, but there is no integrated logic applied to risk driven by co-occurring hazards. Likewise, insurers apply sophisticated, stochastic risk models (e.g. >10,000 simulated events), yet inland flooding and extreme wind are still modelled as separate and independent. A critical advance to better understanding flooding and extreme wind was identifying that they were systematically linked (Hillier et al., 2015). Spurred on by this initial observation, various UKRI funded projects (i.e. UKCGFI, a KTP with Lloyds Bank Group, STORMY-WEATHER, ROBUST) are building a scientific evidence base for a link between these two hazards. As part of this, in 2022 the Bank of England introduced an initial (cautious) requirement for insurers to account for this link in the stress tests to which they must submit. HYDRA will take this work to a new level, extending this important line of enquiry to the wider wintertime multi-hazard system (i.e. inland flooding, landslide, extreme wind, storm surge, extreme cold, snow). HYDRA is an exploratory project that aims to identify, quantify, and provisionally explain how the co-occurrence of six key GB hydro-meteorological wintertime extremes exacerbates risk. HYDRA will use historical observations (assimilated in ERA5, GLOFAS) and UKCP18 regional climate projections to better understand how linked hazards will evolve into the future. Rail and other infrastructure providers' sensitivity to identified co-occurrences will then be mapped in workshops book-ending the scientific work. HYDRA's science is ground-breaking due to the lack of systematic, highly multi-hazard risk evidence currently available. In addition to contributing to NERC science, it will define the engineering (EPSRC) challenge by identifying drivers for risk modelling of infrastructure networks, and will feed into policy (via DEFRA and the CCRA) and industry (e.g. reinsurance) practice.