1. For each day that the high temperature in your hometown is at least 1 degree Fahrenheit above average, as listed by Weather Underground, you owe me $25. For each day that it is at least 1 degree Fahrenheit below average, I owe you $25.
2. The challenge proceeds in monthly intervals, with the first month being August. At the end of each month, we'll tally up the winning and losing days and the loser writes the winner a check for the balance.
3. The challenge automatically rolls over to the next month until/unless: (i) one party informs the other by the 20th of the previous month that he would like to discontinue the challenge (that is, if you want to discontinue the challenge for September, you'd have to tell me this by August 20th), or (ii) the losing party has failed to pay the winning party in a timely fashion, in which case the challenge may be canceled at the sole discretion of the winning party.
The two questions I have for climate bets I consider are 1. will winning the bet provide substantial evidence in support of the winner's position and against the loser's position; and 2. is my side likely to win. I'd say Nate's offer fails the first test and probably passes the second. Weather in any one location over a short period of several months tells you almost nothing about whether global climate change is real.
As to winning, Nate is betting current temps against historical average, and because the US has warmed from climate change, odds should be slightly in his favor. On the other hand, his potential betting opponents can look up long-term forecasts for their region. While not highly accurate, I'd guess a place with a forecasted cold autumn could go below average. But Nate's the stats wizard, not me, so I guess he thinks the odds are low, or he has already checked long-term forecasts for the entire US and thinks he's safe, especially since he's closing the bet period in two days.
All in all, an okay method he's using to shut down some stupidity, but not a bet I'd do myself.