Green Cities Facility

Enabling the transition of cities to low-carbon, climate-resilient urban development.

Urban areas account for approximately 70 percent of the global energy consumption and about 75 percent of emissions due to the density of infrastructure and their often path-dependent development patterns. While this makes cities vulnerable to the impacts of climate change, cities can also play an important role in taking on climate change mitigation and adaptation actions.

Green Cities minimise environmental impact and maximise opportunities to improve and support the natural environment. Green Cities are energy efficient and reduce reliance on non-renewable energy sources, actively encourage waste reduction and management, include green and resilient infrastructure, low carbon transport, water cycle management and deliver improved quality of life outcomes for residents.

There is not a uniform definition ‘Green City’. However, there are several central themes that help to shape and define what a Green City is. Such themes include energy efficiency (including built form) and reducing reliance non-renewable energy sources, sustainable and low carbon transportation systems, green, resilient infrastructure, waste reduction and management, increased green areas, water cycle management and integrated planning. How a city develops as green varies across geography, sector and pace at which it occurs. Decisions taken by city leaders on where, what and how investment will be directed to support green development needs to be considered adopting a system-based approach. A system-based approach recognises the interconnectedness of sectors and the importance of sequencing. It also recognises that cities will evolve to different levels of ‘green’ at different rates and that this development is not uniform.

Hence, transitioning to a path of low-carbon development can be challenging as municipalities face financial constraints for funding sustainable urban infrastructure. Under this project, cities that have higher than average energy and carbon density, and are facing a range of environmental and social issues, will have access to a Green Cities Facility. The Facility will help address the cities’ climate change challenges while building the market case for private sector investments in sustainable infrastructure. It will provide concessional financial instruments that will allow ambitious investments in climate-resilient urban infrastructure such as district heating/cooling, low-carbon buildings, and solid waste management. 

The project has an estimated lifespan of 29 years.

The project's financial information has been updated to reflect this approval.