Exploring the economic case for climate action in cities

This research paper evaluates the economic viability of low-carbon investments in five cities (Leeds, Kolkata, Lima, Johor Bahru, and Palembang). It finds a compelling economic case, with potential emission reductions of 15-24% over 10 years and a short average payback period of 2 years. While global replication could reduce energy-related GHG emissions by 10-18% by 2025, the authors warn that rapid urban growth could offset these gains within 7 years and that institutional barriers must be overcome to implement these measures.

• Investing in cost-effective low-carbon measures in cities can lead to significant emission reductions of 15–24% relative to business-as-usual trends over the next 10 years. These investments require an average of 3.2 billion USD per city, representing 0.4–0.9% of city GDP annually over a decade, with an average payback period of approximately 2 years at commercial interest rates. The resulting savings from reduced energy bills are estimated to be between 1.7% and 9.5% of annual city-scale GDP.
• If the findings from the studied cities were replicated globally, investments could result in reductions equivalent to 10–18% of global energy-related GHG emissions by 2025.
• In rapidly growing cities, the carbon savings achieved through these investments could be negated by sustained population and economic growth in as little as 7 years.

APA

Stockholm Environment Institute (2015). Exploring the economic case for climate action in cities. https://www.sei.org/publications/exploring-the-economic-case-for-climate-action-in-cities/

Chicago

Stockholm Environment Institute. Exploring the economic case for climate action in cities. 2015. https://www.sei.org/publications/exploring-the-economic-case-for-climate-action-in-cities/.

Wikipedia

{{cite report |author=Stockholm Environment Institute |title=Exploring the economic case for climate action in cities |date=8 September 2015 |url=https://www.sei.org/publications/exploring-the-economic-case-for-climate-action-in-cities/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{stockholmenvironmentinstitute2015exploring, author = {{Stockholm Environment Institute}}, title = {{Exploring the economic case for climate action in cities}}, institution = {Stockholm Environment Institute}, year = {2015}, month = sep, url = {https://www.sei.org/publications/exploring-the-economic-case-for-climate-action-in-cities/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }