Cities around the world are dialling for dollars—$65 billion, to be exact—to meet surging interest in climate-related infrastructure projects, concludes a think tank report released early in the COP28 climate summit in Dubai.
With demand for financing up 52% over the last two years, “the opportunity for governments, businesses, and financial institutions to invest in climate infrastructure in cities has never been greater or more urgent,” writes CDP, the non-profit formerly known as the Carbon Disclosure Project, in a summary of its November 30 data release.
Out of the total pool of cities that participated in CDP’s data-gathering, 636 across 86 countries reported a total of 2,346 projects worth US$146 billion, the release says. More than four-fifths of them—83% in total—are searching for full or partial funding, with $65 billion still to be raised.
Given the high cost of climate infrastructure projects and limited municipal budgets, that demand will only be met with a “rapid acceleration of support and investment from national governments, the private sector,” and in the Global South, multilateral development banks and other financial institutions, CDP says.
Of the more than 1,000 cities that reported projects to a CDP-ICLEI database in 2023, 45% were in developing countries.
Buildings and energy efficiency accounted for 482 projects worth $34 billion, followed by transport (359 projects, $31 billion), waste management (300 projects, $8 billion), renewable energy (277 projects, $12 billion), and water management (273 projects, $30 billion). The early stage of many of the projects pointed to the need for technical assistance to get them financed and implemented, while their small size—two-fifths were worth less than $500,000—meant that cities will have to aggregate them to attract investment.
“Sustainable and resilient infrastructure is the cornerstone of tangible climate action,” said Maia Kutner, CDP’s global director of cities, states and regions. “Climate infrastructure requires real money tied to real places to be delivered on real dates, but it is an entirely positive investment to create a truly sustainable economy.”
“Local governments have ambitious climate plans but often lack the funding and support to turn plans into action,” added Andy Deacon, co-managing director of the Global Covenant of Mayors. “By having a global pipeline of projects developed by cities and subnational governments and connected to project preparation facilities, we can bridge the subnational climate finance gap through partnerships that increase investment for climate action in cities and subnational governments.”
