Climate Change Financial Risk Act of 2025
Sponsored By: Representative Rep. Casten, Sean [D-IL-6]
Introduced
Summary
Would require the Federal Reserve to lead coordinated climate-related financial risk scenario development and biennial stress tests. It would create new technical and supervisory tools so regulators and firms can assess and plan for physical and transition risks across the financial system.
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Bill Overview
Analyzed Economic Effects
4 provisions identified: 1 benefits, 0 costs, 3 mixed.
Fed would build climate risk scenarios
Within 1 year of enactment, the Federal Reserve would create three climate risk scenarios. One would assume 1.5°C warming, one 2°C, and one reflects likely warming under current national policies. A 10-member unpaid expert group—five climate scientists and five economists—would help build and review the scenarios and publish the results. The Fed would also coordinate with federal science leaders at NOAA, EPA, NASA, Energy, and others. Final work would be public, and the group would give technical help to both covered and non‑covered firms.
Regular climate tests for biggest firms
Every two years, the Federal Reserve would test each covered entity to see if it has enough capital under each climate scenario. After the first test, firms would need a climate risk resolution plan with a capital policy and clear targets to fix weaknesses. The Fed could object to a plan that would not keep capital above all minimums. For the first three tests, firms would not face adverse consequences from the analysis. The Fed would publish a summary and send results to Congress within 60 days after each of the first three tests.
Which big firms face climate checks
If enacted, this would set who counts as a covered entity and who gets surveyed. Firms with $250 billion or more in assets would be covered automatically. Firms with $100 billion or more could be covered if the Federal Reserve decides it is needed based on risk factors. Supervised firms with $10 billion or more that are not covered would be treated as surveyed entities. These rules would define how far climate oversight reaches across large financial firms.
Climate risk surveys for large institutions
Within 1 year after the first analysis finishes, the Fed would survey each surveyed entity on climate risks. An initial public report would come within 18 months, without naming any firm. The Fed would repeat the survey within 2 years of that report and then every two years, with each new report due within 180 days. The survey would look at firms’ exposures, plans to adapt, and whether those plans seem plausible.
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Sponsors & CoSponsors
Sponsor
Rep. Casten, Sean [D-IL-6]
IL • D
Cosponsors
Rep. Lynch, Stephen F. [D-MA-8]
MA • D
Sponsored 4/29/2025
Rep. Cleaver, Emanuel [D-MO-5]
MO • D
Sponsored 4/29/2025
Rep. Huffman, Jared [D-CA-2]
CA • D
Sponsored 4/29/2025
Rep. Mullin, Kevin [D-CA-15]
CA • D
Sponsored 4/29/2025
Elfreth
MD • D
Sponsored 4/29/2025
Rep. Carbajal, Salud O. [D-CA-24]
CA • D
Sponsored 4/29/2025
Rep. Levin, Mike [D-CA-49]
CA • D
Sponsored 6/3/2025
Rep. Carson, Andre [D-IN-7]
IN • D
Sponsored 4/29/2025
Rep. Magaziner, Seth [D-RI-2]
RI • D
Sponsored 5/19/2025
Rep. Green, Al [D-TX-9]
TX • D
Sponsored 2/24/2026
Roll Call Votes
No roll call votes available for this bill.
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