Urban Economics

Urban Development and Climate Change Relationship

Introduction: Urban development is linked to climate change & its effect on climate change is being studied. Various factors which are backbone of urbanisation creates pollution

Urban development is defines as the social, cultural, economic and physical development of cities, as well as the underlying causes of these processes. [1]

Climate change is a large-scale, long-term shift in the planet’s weather patterns or average temperatures. [2]

urban development and climate change relationship
urban development and climate change relationship

Today more than 50% of the world’s population lives in urban areas. This is linked with “Development” and considered to be a good change. There is an increasing pressure on nations to outshine other by having larger and larger proportion of its population living in cities, this is so because it is regarded as a sign of economic and as well as overall development. Cities are known to provide better quality of life which is attributed to better access to facilities, more employment opportunities, better income, better education and overall increase in choices in one’s life. In many of the developing countries living is a city is also considered as a status symbol. While cities have always been fascinating & attractive because of wider opportunities they have their own problems face criticism. Cities have been long criticized for number of problems like deteriorating health condition because of stress, loss of culture, hectic & stressful life, resource depletion & particularly climate change.

Cities are seen as economic engine of a country as a large proportion of a nation’s wealth is concentrated & invested in cities. This concentration of money and investment results in infrastructure development in a city & subsequently more and more use of resources to build this infrastructure. Raw materials required for construction are brought from far off places and are processed to get the required product. This process of procuring material, processing and transporting created a lot of pollution itself. Once infrastructure is built it required maintenance & regular quality checks. Over a period of time the maintenance cost & material required to maintain the existing infrastructure required more and more money which becomes a never-ending cycle.

With the improved infrastructure increased number of people are attracted towards the cities because of aforesaid reasons. This results in need of additional infrastructure to sustain increasing population. Population living in city also demands better facilities apart from existing infrastructure & thus consumes more and more resources which include food, water, energy, and environment. With increased consumption waste generation also increases.

Studies have shown that urban areas/cities are primarily responsible for climate change. The studies are conducted while taking number of parameters like consumption of food, energy, wastage, pollution, trip distance etc. Pollution & energy consumption have been exceptionally high in cities. It is also said that urban areas are not responsible for climate changes because if the people would have not been living in urban area then they would have been living in some other place and caused same problem. But this notion is opposed it is not possible in other areas to perform large number of activities in other areas. Assessing the contribution of cities to climate change is not a straightforward process, and there has been substantial debate about the proportion of global emissions that can or should be attributed to urban areas.

While urban areas have effect on climate, change in climate also affects urban areas radically. This is because of higher density in urban areas and compact development. For example, increase in temperature in an area will result in more energy consumption to cool the buildings, increase in sea level will submerge the cities along coast and may reduce the available landmass for development thus increasing the land prices. Also since most of the cities are dependent on rural and surrounding areas for their food requirement, for perishable goods, wood, electricity and other raw materials. Studies have been conducted to understand the climate change relationship by comparing effect of rural and urban areas, urban and urban areas and components within urban areas as well. The result gives the effect of urban development on rural areas, urban areas and within urban areas.

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Problem in estimating emissions

Problem starts at the very beginning i.e. in classification of ‘urban areas’ is different between different countries, the ways of defining urban boundaries, and the quality of data available. Classification of different sectors – transportation, energy for electricity, commercial and residential buildings, agriculture, industry, waste, land-use change and forestry – are all relevant to urban areas, which rely on goods, services and processes taking place both inside and outside their municipal boundaries. There is large differences in GHG emissions in under developed, developing & developed nations. The difference can be as high as 100 times in the lowest and highest emission countries. Number of factors influences the total and per capita emissions in/of a city, including geographical location (influencing the amount of energy required for cooling/heating & lighting), demography (need of different facilities), spatial organisation and population density (sprawling cities tend to have higher per capita emissions than more compact ones), and the type of activities taking place & presence of industries. If we relate the per capita emissions with income of people living in the cities then it can be seen that the richer cities have higher emissions as compared to developing and less developed countries.

Factors responsible for climate change

On basis of these studies it has been found that the use and choice of material for infrastructure building has an important role to determine temperature gains in an area. Formation of urban heat islands (UHIs) is well-known phenomenon in urban areas. These are formed due to heat absorption by concrete, asphalt & other construction material which increases the temperature of these materials and surrounding area. These UHIs results in increased energy demand to keep areas cool. This also effects the micro climate & alters the local wind pattern.

With increased population, change in lifestyle & wider choices people tend to buy more, use more and waste more. This results in problem of Solid Waste Management (SWM) which if not done properly results in land, air and water pollution. Once the waste gets mixed up in dumping site/ landfill site it starts generating toxic fumes & other harmful gases in the atmosphere. Thus there is a need of segregation & proper disposal which again increases energy consumption.

Energy Consumption – Urban areas are known to have high energy consumption because of presence of industries, per capita demand, type of facilities available & a large number of consumers. Per capita carbon emission are highest in urban areas.


Electricity in a city is generally obtained from outside the city where it is generated by means of hydro/thermal/nuclear/solar power plants. This shows the dependency of cities on outside area for electricity requirements. This electricity generation results in air, water and land, pollution. Hydro power plants are known to disturb the aquatic life. This results in ecological imbalance. Electricity consumption is high in urban areas due to more dependency on technology & electronic goods. More and more electronic equipment are used in houses, industries, offices & commercial areas. For eg. Street lights consume a large proportion of electricity in United States, this is due to large number of street lights and high road density which is a feature of urban areas. Increase in road density also results in heat gain and rise in temperature due to their colour and material. Roads take up as much as 20% -25% of the total land mass in cities. Eg. Approx. 22% of land mass of Delhi in occupied by roads. In developing nations where electricity is generated using coal based thermal power plant 1kg of carbon dioxide is released along other gases to generate one unit of electricity because of burning of coal. Since electricity consumption is high in urban areas, emissions also become high although outside the city boundary where power plant is located.

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Global Warming

Fuel – Use of fuel for industries, transportation & other used results in pollution. Large number of trips in urban areas to access facilities, to reach workplace, for shopping & leisure activities results in pollution. Travel distance and journey time in urban areas are relatively much higher than in rural areas and thus per capita fuel consumption is also high. High private vehicle ownership and traffic jams adds to wastage of fuel. Although there have been focus on more use of public transport & increased usage of electric vehicles so as to reduce the air pollution, but it is ignored that the electricity which is used to run these vehicles is causing air pollution at some other place. There has been shift in focus to be less dependent on fossil fuels for electricity generation and use of more renewable energy but still directly or indirectly non-renewable sources of energy are being used for electricity generation.


Cutting of trees on large-scale for getting land is also an area of concern. Large number of trees are cut to make land available for a project. Due to this people face number of respiratory problems and cities act as smoking chimneys.

In urban areas soft spaces are occupied and covered with hard non porous materials which affects percolation of water into ground and increases surface runoff. This water is at times contaminated and enters in water body and thus pollutes it. Also waste water coming from houses, industries in cities is not treated properly and contains toxic substances and pollutes water bodies.

When we look at the collective damage caused by activities in cities it is attributed to large problems like greenhouse effect, ozone layer depletion, rising sea level, loss of diversity of flora and fauna.

Measures to fight climate change and mitigate the effects

It is mandatory in most of the areas to conduct an Environmental Impact Assessment (EIA) and prepare a report detailing out the impact of development and measures to tackle it. But the standards adopted and the procedure differs from country to country and even cities to cities.  Assessment of indirect impacts is vital for cities. This is because activities are concentrated in limited areas in urban areas. They function as inter dependent and integrated systems, consisting of closely interlinked sectors and infrastructure. For example, people are heavily dependent on public transportation and in London, Paris, Delhi and a disruption in their service would cause huge economic loss. In the same way, damages to the networks like sewage and water drainage network will lead to serious health issues, with direct and indirect impact on other activities. As a consequence, assessing climate change impacts in cities cannot be based only on quantitative approaches that consider each economic sector. It requires a systemic view, taking into account all components of the socio-economic activity and the network of relationships making up the system.

There has been an increasing debate about the proportion of global emissions that can or should be attributed to urban areas. This is partially due to the lack of a globally accepted standardized policy, methods and levels on basis of which cities/countries can be called ‘responsible’.

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According to the UNFCCC, inventories should meet the following five quality criteria:

1 Transparency: assumptions and methodologies should be clearly explained.

2 Consistency: the same methodology should be used for base and subsequent years.

3 Comparability: inventories should be comparable between different places.

4 Completeness: inventories should cover all relevant sources of emissions.

5 Accuracy: inventories should be neither over nor under true emissions.

Role of Urban Planning

Planning can help in reducing the carbon footprint and overall impact of urban area on climate. In addition to a sectoral approach (transportation, housing, etc.), many public decision and policy makers, international institutions agrees and believe that an integrated approach to urban planning is required as a local solution and also a city level solution to the overall climate change challenge. By applying the principles of compactness, density, and functional variety, an integrated approach seeks to optimize the impact of sectoral measures to promote sustainable urban development. Such an approach should focus on:

  • Effective spatial distribution of activities and services, while retaining of open/green spaces
  • Efficient transportation planning (including price systems, reduced trip distance and time)
  • Measures to promote the stabilization of land prices

It has been found that increase in urban compactness has resulted in improved energy efficiency which is attributed mainly to reduction in the average commuting distance. In other words for a given spatial distribution of economic activities, increase in urban compactness is helpful in preservation of the environment. Reinforcing density has consequences on prices, wages, and land value, which may lead to a spatial redistribution of economic activities, with potentially opposite environmental effects

Many adaptation measures and actions in cities will require the mobilization of financial resources and these financial requirements will vary depending on the nature of these actions. These actions can be huge investment in infrastructure like investing in solar farms and other renewable sources of energy and other elements of the built environment, to changes in maintenance and regular expenditures based on day-to-day municipal operations. Although one time upfront and establishment costs can be large, the benefits of taking adaptation actions can outweigh the costs.

Also change in lifestyle in urban areas can have a drastic impact directly and indirectly on emissions. Significant reduction in energy demand is seen during “Earth Hour” in which number of cities participate. If some simple habits are incorporated in lifestyle of people then cities will have a much lesser impact on environment.

Policy framing to reduce the impact on environment:

  • Taxation/fine for emission more than prescribed limits
  • Mutual agreement at global level to reduce emissions
  • Just laws for both developed and developing nations
  • Laws to prevent over exploitation of resources by rich
  • Making better/ more efficient technology available throughout the world at low/reasonable cost
  • Participation in global summits
  • Increasing awareness about the issues & ways to tackle it
  • Check on land prices to increase affordability and reduced travel distance & trips
  • Laws to encourage renewable energy sector
  • Pricing of equipment/services/facilities keeping in mind the environmental damage associated with it
  • Mandatory use or incentivize the production/use of bio degradable materials especially for packaging
  • Localised & problem specific laws as many problems are diverse, unique and area specific


  • [1] University of Oslo, Department of Sociology & Human Geography (http://www.sv.uio.no/iss/english/research/subjects/urban-development)
  • [2] By Met office, Govt. of UK (http://www.metoffice.gov.uk/climate-guide/climate-change)
  • The United Nations Framework Convention on Climate Change (UNFCCC)
  • OECD Environment Working Papers
  • Guide to Climate Change Adaptation in Cities by World Bank Group

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