Cold capital city -- note prevailing conditions (7)
I believe the answer is:
climate
'prevailing conditions' is the definition.
(I've seen this in another clue)
'cold capital city note' is the wordplay.
'cold' becomes 'c' (abbreviation, eg on taps).
'capital city' becomes 'Lima' (capital of Peru).
'note' becomes 'te' (musical note).
'c'+'lima'+'te'='CLIMATE'
(Other definitions for climate that I've seen before include "General weather conditions in an area" , "The regular weather conditions of a region" , "Feeling" , "Mood" , "Weather etc" .)