Supporting financing of local adaptation actions with combination of public funding and private financing

The HORIZON-MISS-2026-01-CLIMA-07 grant opportunity, part of the Horizon Europe program, focuses on finance solutions for local climate adaptation projects, combining public and private funding. It is designed for consortia comprising public and private sector stakeholders, particularly those involved in climate adaptation financing, including National Promotional Banks (NPBs), commercial banks, and local authorities. The aim is to mobilize substantial investments to implement innovative adaptation actions that enhance climate resilience.

The total budget for this grant is €20 million, with an anticipated funding of one grant. Individual project grants can range from €500,000 to €10 million; however, subgrants to third-party recipients are capped at €800,000 and cannot exceed 70 percent of total project costs, necessitating co-funding from private loans.

Geographic eligibility extends to EU member states and associated countries, stressing the importance of broad participation across various regions. The primary focus is on climate adaptation initiatives, especially those employing nature-based solutions, and areas such as disaster risk management and cultural heritage protection from climate impacts.

Successful proposals should validate new adaptation solutions in real-life conditions while actively engaging with the EIB for technical assistance. Proposals have a single-stage submission process, opening on February 4, 2026, and closing on September 23, 2026. Given the competitive nature of the funding, success rates are expected to be below 10 percent.

The program seeks to identify barriers to financing local adaptation projects and develop strategies for their resolution, aiming to create a sustainable model that integrates grant funding with private financing. Consortia must demonstrate experience in finance, and local adaptation actions should involve collaboration with both public and private entities. The initiative emphasizes the critical role of the EIB in facilitating financing and providing advisory support, with an expectation of generating recommendations to improve financing mechanisms for local adaptation efforts.

This EU grant opportunity, HORIZON-MISS-2026-01-CLIMA-07, falls under the Horizon Europe (HORIZON) program and aims to support the implementation of the Adaptation to Climate Change Mission (HORIZON-MISS-2026-1). It is a HORIZON Coordination and Support Action (HORIZON-CSA) with a HORIZON Action Grant Budget-Based [HORIZON-AG] model grant agreement. The call is forthcoming and follows a single-stage deadline model. The planned opening date is 04 February 2026, and the deadline for submission is 23 September 2026, 17:00:00 Brussels time. The topic budget is 20,000,000 EUR, and it is expected that around one grant will be awarded.

The expected outcome of this grant is to support the EU Adaptation Strategy and the EU Mission on Adaptation to Climate Change, particularly concerning the upcoming European Climate Adaptation Plan. Project results should contribute to:

Bringing together local climate adaptation actors, the financing sector, the public grant sector, and climate adaptation financing experience to make local adaptation actions financeable. This involves combining public grant funding and private financing via bank loans and overcoming practical barriers through intermediated EIB adaptation lending.

Implementing local innovative adaptation actions, including nature-based solutions, financed by a combination of private financing via bank loans and public grant funding.

Mobilizing National Promotional Banks (NPBs) and other banks to actively finance local adaptation actions.

The scope of the grant addresses the rationale that financing for local adaptation actions is insufficient, especially through means other than public grant funding. Adaptation actions often lack sufficient revenues to be bankable, despite their financial and economic benefits. Local adaptation actions are typically smaller, leading to high transaction costs and insufficient scale for bankability, creating financing barriers. Combining public grants with private financing, such as bank loans, can enhance adaptation action financing. Demonstration and assessment in real-life conditions are needed to identify barriers and solutions to financing local adaptation actions, particularly combining public grant funding and private financing via bank loans, and to foster innovation in this area.

Financing is a key enabler for the Adaptation Mission. The goal is to involve private and public sector stakeholders to attract private financing via bank loans by providing public grants for local adaptation actions, with the aim of replication and scaling up. NPBs and other banks play a crucial role in financing local adaptation due to their size and proximity to local actions, which should grow in importance given the significant financing required for adaptation and climate resilience.

The European Investment Bank (EIB), as the EU Climate Bank, collaborates with the European Commission to address adaptation financing barriers through lending and advisory assistance, aligned with the EIB Climate Adaptation Plan and the EIB Climate Bank Roadmap. The EIB supports the Adaptation Mission.

This action aligns with EIB support for adaptation through intermediated loans with a Climate Action and Environmental Sustainability window, making lending available to NPBs and other banks for local climate adaptation actions.

The EIB will provide technical assistance and adaptation advisory support for local adaptation actions to NPBs/other banks (under the InvestEU Advisory Hub’s Green Gateway programme) and/or project promoters (under the ADAPT platform, subject to eligibility and availability). The EIB will also offer guidance and share knowledge to support successful project implementation.

This action with the EIB supports the follow-up to the July 2023 Communication on EU Missions assessment.

Project activities should demonstrate local innovative adaptation actions (testing and demonstration in real-life conditions) and their financing by combining public grants obtained via financial support to third parties (FSTP) with private financing via bank loans. The activities should also generate recommendations on combining these financing sources, identify barriers, and propose practical solutions.

Proposals must address the following:

1. Provide FSTP in the form of grants to project promoters to demonstrate local innovative adaptation actions and their financing by combining public grant funding and bank loan financing via intermediated EIB adaptation loans, with scale-up and replication potential.

At least 70% of the total EU requested contribution should be allocated to financial support to third parties.

Local adaptation actions should range in size from EUR 500,000 to EUR 10 million. The grant to third parties cannot exceed 70% of the total costs of the local adaptation action.

The first cascade call should be launched within the first 10 months of the project.

Proposals should describe how they intend to provide financial support to third parties, in accordance with the FSTP Annex provided with the application form, clarifying the types of activity (considering activities that qualify as EIB eligible adaptation) and the procedures for giving financial support. These procedures should ensure compliance with no double-funding rules and that the same rules as set out for the EU call conditions in relation to eligible costs will apply (i.e., cost eligibility rules). Proposals should also specifically consider elements within the FSTP scheme to address geographical balance and inclusivity, aiming for an as wide as possible coverage of different countries.

The consortium should establish coordination and is encouraged to consult/involve NPBs and other banks as stakeholders, working closely with the EIB, particularly on the criteria for local innovative adaptation actions. Proposals should suggest a structure/activities for this involvement and cooperation.

The project retained for granting is expected to hold dedicated exchanges with CINEA and the Mission Secretariat during the preparation of the cascade funding call(s).

2. Assess and draw lessons and recommendations from the financing of the above local adaptation actions from different financing sources and combinations of loans and grants used in the past for financing adaptation at national, regional, or EU level (e.g., LIFE integrated projects, National Capital Finance Facility, etc.). This includes:

Capturing and analysing barriers encountered in financing local adaptation actions, covering all financing sources combined, including public funding and bank loans, and proposing practical ways to overcome these barriers.

Analysing how the EU taxonomy is being applied.

Collecting lessons learned.

Raising awareness and disseminating knowledge by providing examples of good practices, including short case studies of successful combinations of public grants and bank loans.

Providing recommendations on successfully combining public grants and bank loans, the appropriate proportion and conditions of public grant funding, and the appropriate combination of grant/bank loan.

Producing recommendations on how to attract private financing via bank loans by providing public grants to finance local adaptation actions, with a view to replication and scaling up.

Disseminating outcomes via targeted channels and materials for the benefit of regional and local authorities within the Mission and beyond.

Proposals should demonstrate the experience in finance in the consortium.

The subgrant call should be open to any public or private entities, including SMEs, and regional or local administrations could also be recipients.

Subgrantees should demonstrate innovative local adaptation actions and their financing by combining public grants and private financing via bank loans. To demonstrate adaptation financing at a small scale as a pilot, EIB intermediated adaptation lending will be used for the loan element. Therefore, eligible third parties are project promoters that should have already received a written offer subject to contract from a NPB/other bank of a loan (conditional upon securing the subgrant) to finance the local adaptation action that is in line with the EIB Climate Action and Environmental Sustainability criteria under an EIB intermediated finance contract before applying for the subgrant.

In this manner, the NPBs/other banks will have assessed that all the local adaptation actions meet the same EIB requirements for adaptation. As the EIB eligibility criteria include that the local adaptation actions should address specific climate risks identified as relevant by the regional or local authority and be in line with the relevant adaptation strategy or plan, this will imply that the adaptation actions supported under this topic will be contributing to implementing the regional/local adaption plan where approved and in place. The local adaptation actions will, before applying for the subgrant, have been appraised by the National Promotional Bank/other bank and assessed as viable if securing the subgrant.

The National Promotional Banks and other banks will be able to facilitate access for project promoters to the combination of financing and activate the origination and financing of local adaptation actions.

In line with the Mission Implementation Plan, Nature-based Solutions should be explored as preferred options where feasible for the local adaptation actions.

Proposals are strongly encouraged to build on existing knowledge developed by previous projects and when relevant explore synergies with ongoing projects from EU and national programmes. Proposals should use the work done for the Adaptation Mission by the Climate City Capital Hub on the financing of adaptation projects of Adaptation Mission Signatories. Proposals should include a mechanism to establish operational links and collaboration with the Mission Implementation Platform (including on monitoring). The project funded under this topic will be expected to participate in the Mission Community of Practice and to share relevant knowledge for regional and local authorities through the Mission.

The page limit for the application is 70 pages.

The general conditions related to admissibility, eligible countries, other eligible conditions, financial and operational capacity, exclusion, evaluation and award criteria, submission and evaluation processes, indicative timeline, and legal and financial setup are described in the relevant annexes of the Horizon Europe Work Programme General Annexes.

Beneficiaries must provide financial support to third parties in the form of grants. The maximum amount to be granted to each third party is EUR 800,000 to demonstrate financing with public funding and private financing of local adaptation actions.

The application form templates specific to this call are available in the Submission System, including the standard application form (HE CSA) and the standard evaluation form (HE CSA).

Guidance documents include the HE Programme Guide, Model Grant Agreements (HE MGA), call-specific instructions, and information on financial support to third parties (HE).

Additional documents include the HE Main Work Programme 2026-2027, the HE Programme Guide, the HE Framework Programme 2021/695, the HE Specific Programme Decision 2021/764, the EU Financial Regulation 2024/2509, rules for legal entity validation, LEAR appointment and financial capacity assessment, the EU Grants AGA Annotated Model Grant Agreement, the Funding & Tenders Portal Online Manual, Funding & Tenders Portal Terms and Conditions, and the Funding & Tenders Portal Privacy Statement.

This funding opportunity aims to mobilize local climate adaptation efforts by combining public and private financing. It seeks to address the current underutilization of private financing for local adaptation projects by providing grants to project promoters who can demonstrate innovative adaptation actions. The program emphasizes the importance of National Promotional Banks and other banks in facilitating access to combined financing and encourages the use of nature-based solutions. The ultimate goal is to identify and overcome barriers to financing local adaptation actions, develop best practices, and disseminate knowledge to regional and local authorities, thereby scaling up and replicating successful adaptation strategies across the EU.

Eligible Applicant Types: The call is open to public or private entities, including SMEs, National Promotional Banks (NPBs), and other banks. Regional or local administrations could also be recipients of subgrants. The primary applicant must be a consortium with demonstrated experience in finance.

Funding Type: The primary funding mechanism is a grant, with financial support to third parties (FSTP) provided in the form of grants. The EIB will also offer technical assistance and advisory support.

Consortium Requirement: A consortium of multiple applicants is required. The consortium should establish coordination and is encouraged to consult/involve the NPBs and other banks as stakeholders, and work closely with the EIB.

Beneficiary Scope (Geographic Eligibility): The information explicitly mentions geographical balance and inclusivity, aiming for as wide as possible coverage of different countries. While not explicitly stated, eligibility is likely within EU member states and associated countries, aligning with Horizon Europe's general framework. A number of non-EU/non-Associated Countries that are not automatically eligible for funding have made specific provisions for making funding available for their participants in Horizon Europe projects.

Target Sector: The program targets the climate adaptation sector, specifically focusing on financing local adaptation actions, including nature-based solutions. It also involves the finance sector, public grant sector, and innovation.

Mentioned Countries: No specific countries are mentioned, but the call aims for geographical balance and inclusivity across different countries, implying a broad European scope.

Project Stage: The project stage is demonstration, validation, and implementation. Proposals should demonstrate local innovative adaptation actions in real-life conditions, testing and demonstrating their financing mechanisms.

Funding Amount: The overall budget for the HORIZON-MISS-2026-01-CLIMA-07 topic is EUR 20,000,000. At least 70% of the total EU requested contribution should be allocated for financial support to third parties. Local adaptation actions should have a size between EUR 500,000 and EUR 10 million. The grant to third parties cannot cover more than 70% of the total costs of the local adaptation action. The maximum amount to be granted to each third party is EUR 800,000.

Application Type: The application type is a single-stage open call within the Horizon Europe framework.

Nature of Support: Beneficiaries will receive money in the form of grants. Additionally, the EIB will provide technical assistance and advisory support.

Application Stages: The application process is a single-stage process.

Success Rates: The indicative number of grants for the HORIZON-MISS-2026-01-CLIMA-07 topic is 1.

Co-funding Requirement: Co-funding is required at the level of the subgrantees, as the grant to third parties cannot cover more than 70% of the total costs of the local adaptation action. The remaining funding is expected to come from private financing via bank loans.

Summary:

This Horizon Europe call, HORIZON-MISS-2026-01-CLIMA-07, aims to support the implementation of the EU Adaptation Strategy and the EU Mission on Adaptation to Climate Change. The call focuses on "Supporting financing of local adaptation actions with combination of public funding and private financing". It seeks to mobilize local climate adaptation actors, the financing sector, and the public grant sector to work together on making local adaptation actions financeable. The core idea is to combine public grant funding with private financing via bank loans to overcome financial barriers and scale up local adaptation efforts.

The selected consortium will be responsible for providing financial support to third parties (FSTP) in the form of grants to project promoters. These subgrants will support the demonstration of innovative local adaptation actions, with a strong emphasis on combining public funding and bank loan financing, ideally through EIB intermediated adaptation loans. A significant portion (at least 70%) of the EU funding must be allocated to these subgrants. The consortium will also assess the barriers and solutions to such financing, drawing lessons from past experiences and providing recommendations for successful implementation and scaling up. The European Investment Bank (EIB) will play a crucial role by offering technical assistance, advisory support, and guidance to the selected consortium and project promoters. The call encourages the use of nature-based solutions and collaboration with the Mission Implementation Platform. The total budget for this topic is EUR 20,000,000, and only one project is expected to be funded. The call is a single-stage application process, with a deadline of 23 September 2026.