The City Investment Imperative for Net Zero
How can we ensure sufficient up-front investment is available for cities to transition rapidly away from carbon-intensive systems? This was the central issue of an event on The City Investment Imperative for Net Zero, held on Finance Day at COP 26. The event addressed the need for significant public and private funding and collaboration. Other key themes to emerge included the need for a just transition to Net Zero, as well as the importance of combining government spending announcements with practical spending and implementation plans. The event also featured new research delivered by the UK Cities Climate Investment Commission (UK CCIC), which was launched in July 2021, and is a partnership between the event’s organizers: Connected Places Catapult, Core Cities, and London Councils.
The City Investment Imperative for Net Zero event took place both online and at the Multilevel Action Pavilion at COP 26 in Glasgow. The Pavilion, which is being hosted by the Scottish Government and ICLEI—Local Governments for Sustainability, was established as the COP 26 “home” for sub-national organizations, including cities, town, and regional authorities.
Opening of the Session
Greg Clark, Chair of UK CCIC, welcomed participants and outlined the goals of UK CCIC, which is a partnership designed to help aggregate action across the UK’s cities and to engage with central government and the private sector. He stressed that the Net Zero agenda will require significant up-front investment in areas such as home heating, electrification of transport systems, decarbonizing waste, and green infrastructure. He highlighted new research showing that London and the UK’s other “core cities” collectively need £200-300 billion (US$270-410 billion) to achieve Net Zero.
Mathias Cormann, Secretary-General, Organisation for Economic Co-operation and Development (OECD), highlighted the importance of action at the city-level, applauding recent steps and announcements made by cities, such as Bristol and Glasgow. Referring to Net Zero as a “shared responsibility” of national, local, and business leaders, he highlighted several OECD initiatives to support a “bold, innovative, and fair approach.”
Helen Whately, MP, Exchequer Secretary to the UK Treasury, said that while UK cities were centers of creativity and innovation, they face a “huge challenge” in moving to Net Zero. She outlined the UK government’s “leveling up” agenda and its announcement of £26 billion (US$35 billion) in investment. She said public spending would be used to catalyze private finance, with a focus on decarbonizing buildings, improving heating systems, empowering local authorities, and investing in zero emission vehicles.
A panel of experts then engaged in a group discussion moderated by Greg Clark. Key themes to emerge included scaling-up efforts, sources of investment, place-based approaches, a just transition to Net Zero, risks and opportunities of future urban population growth, and next steps for UK cities.
On scaling-up efforts across the UK, Bristol Mayor Marvin Rees said well-designed cities could help unlock decarbonization at scale if they collaborated. For instance, rather than Bristol ordering 150 buses, all 11 core cities in the UK could make a joint order and benefit from economies of scale.
On investment sources, Catherine McGuinness, Chair of Policy and Resources, City of London Corporation, said public funding by itself will not be enough. She urged COP 26 to be the “finance COP” where private and public investment is unlocked. Marvin Rees said the current competitive model for cities to access public funding must be adjusted, with more connections and conversations between local and central governments. He said the financial sector would also need to adjust and change.
Georgia Gould, Chair of London Councils, said a place-based approach was the key to unlocking investment, and supported focusing on this in the UK CCIC’s new report. Marvin Rees said place-based action was not just about local governments, noting that universities, the National Health Service and others are often major landowners or employers in UK cities. Local governments, he said, could be conveners of multiple stakeholders.
On a just transition to Net Zero, Georgia Gould said cities must address social housing, food poverty, air quality, and community engagement.
On the risks and opportunities of future urban growth, Marvin Rees said we need to avoid unplanned and chaotic urbanization, and pointed to the opportunity to decarbonize and improve cities if growth is well planned.
Regarding next steps, Marvin Rees said core cities should connect with national and other existing initiatives to ensure they are aligned. He also said we need to attach clear implementation plans to government funding announcements, adding that “we’re beyond banners and t-shirts and we’re in the zone of spreadsheets and project managers.” Georgia Gould said we must engage and communicate with our communities effectively and talk about warmer homes and real jobs rather than using jargon or technical terms like “retrofitting” and “co-benefits.”
Greg Clark said UK CCIC would work with the financial community, and local and central governments after COP 26 to push for progress. He hailed the UK’s “pioneering” cities and financial expertise in London, as well as commitments from government and an engaged population, suggesting the time was right to advance this agenda. He thanked the participants and speakers, as well as ICLEI for hosting this platform.
Ariel Dekovic | [email protected]
Connected Places Catapult | [email protected]
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