Urban environmental initiatives are paying off

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The world is getting to be a more urban place, with all that goes with it. According to data from the United Nations, about half of the planet now lives in an urban environment rather than a rural one, up from 30 per cent in 1960. That's going to increase even more, to about 60 per cent in a couple of decades, if the UN projections are correct. That's a lot of people living close to one another, and it is going to take a lot of resources to keep them satisfied.

As we get closer to that urban future, we are starting to hear increasingly dire predictions as to how bad that is going to be for the environment – but apparently that might not be the case. According to a new analysis from the Climate Disclosure Project, cities are already taking measures to reduce their carbon footprints, and that is giving us "healthier, wealthier cities."

The study draws on responses from 110 cities from around the globe. Cities were asked what measures they had taken to combat climate change and reduce their energy footprint, and to look at what the costs (or cost savings) were from those initiatives. For the most part, the responses suggest that about half the efforts of cities around the globe has been on finding efficiencies, while the other half run the gamut and include initiatives to get people to drive less and walk or ride bikes more. According to the CDP, that all bodes well for the "healthier part."

But as much as health is an issue in an age of urbanization, the "wealthier" part of things is important too. Cities are being squeezed by declining transfers from other levels of government, which is an issue that is going to get worse before it gets better. So the idea that environmental initiatives could be a net positive in terms of cash flow is a welcome one.

The good news is that there is apparently a decent amount of cost savings going along with the energy initiatives. As a group, the 140 cities are apparently saving $39.5-million annually through their efforts. The results vary by individual city. Los Angeles tops the list: the city saved $13-million, the bulk of it through initiatives regarding LED technology projects. The city was followed by Washington (savings of $6.3-million), Las Vegas ($6.3-million) and Berlin ($4.2-million). Toronto came in seventh place, by saving $1.95-million annually.

Many of the comments from the cities pointed out that by dealing with environmental issues, they were making their regions more attractive as destinations for outside investment, and that is probably true. What is also certainly true is that those cities that do not get a handle on environmental issues are going to put themselves at a business disadvantage sooner rather than later.

Do I take every statistic in this study as gospel? Actually, no I don't. Given the source, of course there was a predisposition to suggesting that dealing with environmental issues is ultimately good for business. Having said that, with the trends that are coming together – climate change, urbanization, fiscal restraint – maybe the biggest positive we can take away from the report is that cities have already done as much planning as they appear to have done. Challenging times may be ahead, but given the early results, maybe we can all breathe a little easier (literally and figuratively) about the likely future.

Linda Nazareth is the principal of Relentless Economics Inc. and a senior fellow at the Macdonald Laurier Institute.