Showcasing Cities’ Investment Needs For Aligned Multilevel Climate Action
Global Snapshot 2024
Cities need finance to unlock their full climate potential.
Cities – home to more than half of the world’s population and responsible for over 70% of global greenhouse gas emissions – are the main line of defence against climate change. Without bold and timely action from cities, achieving net zero emissions and the goals of the Paris Agreement will be impossible. While local governments from across the world are leading on climate ambition and have the potential to drive transformative change, limited access to finance remains a key barrier to cities taking climate action.
Despite urban finance flows more than doubling between 2017 and 2022, they still fall far short of the estimated US$4.5 trillion needed annually through 2030 for climate mitigation and adaptation in cities [1].
To close this gap, mayors and urban leaders have called for at least US$800 billion a year in public investment from national governments and development finance institutions by 2030. This funding – which would cover approximately 20% of total annual urban climate finance needs – is critical to stimulate additional investments from the private sector and improve local governments’ access to financing.
A significant step in mobilizing and prioritizing investment for cities is the Coalition for High-Level Ambition Multilevel Partnerships (CHAMP).
CHAMP is a commitment from national governments to strengthen collaboration with their subnational governments and to better integrate subnational climate actions in the planning, financing, implementation, and monitoring of climate strategies – including in the next round of Nationally Determined Contributions (NDCs 3.0) due before COP30.
In that respect, a key objective for endorsers is to include relevant subnational government projects in climate-related investment priorities, and to support cities and other subnational actors in securing the resources necessary to begin, or scale up, implementation.
Consequently, robust, granular data on cities' pending climate projects and investment needs is vital. It’s a tool to see clearly, act decisively, and drive change. The insights derived from this Snapshot translate to better aligned support and resource allocation from national governments, clearer climate goals, enhanced opportunities for private sector engagement and leveraging the critical role cities play in tackling climate change and taking Earth-positive action for future generations. Learn more about CHAMP endorser countries, below.
About the Snapshot
Developed in partnership with the Global Covenant of Mayors for Climate & Energy, this Snapshot of CDP’s 2024 city climate projects:
Offers actionable insights into the demand for climate finance in cities;
Showcases the variety of projects cities are seeking to advance for adaptation and mitigation;
Highlights best practice actions in project data disclosure; and
Shows how city data reported through CDP-ICLEI Track can support multilevel climate action, through two CHAMP endorser case studies.
Out of the 880+ cities that disclosed through CDP-ICLEI Track in 2024, 611 cities reported a total of 2,508 climate projects seeking US$86 billion in investment.
Amid the urgency to demonstrate progress in addressing the climate crisis and as national governments prepare their updated NDCs ahead of COP30, this Snapshot highlights the significant potential for action in cities and the unprecedented investment opportunity to achieve it.
Key takeaways
Demand for climate finance in cities is increasing year-on-year. Total reported investment needs for projects surged by 23% in 2024, reaching US$86 billion. This increase results from new project disclosures and cities reporting more projects on average.
Investment needs remain concentrated in developed economies, with Europe, North America and Latin America leading in numbers of reported projects. Similar to last year, emerging markets and developing economies (EMDEs) account for only 27% of total reported finance needs. This underscores the continuous need to support EMDE cities in prioritizing and preparing ambitious climate projects.
Water management leads as the top sector globally for projects seeking investment, seeking a total of US$28billion.
Buildings & energy efficiency is the leading sector for reported projects followed by transport, and nature-based solutions, biodiversity & urban green spaces. Building & energy efficiency is the leading sector in developed economies whereas waste management is the top sector for EMDEs.
Nearly half of the 2,508 reported projects are in the early stages of development – prior to the structuring phase – highlighting the need for project preparation assistance, especially in Africa and Latin America.
86% of projects are seeking funding, with a higher proportion of EMDE projects requiring full funding – 40% compared to 25% in developed economies.
1. The 2024 City Climate Projects in numbers
climate projects were reported by 611 cities through CDP-ICLEI Track in 2024.
These cities spanned 75 countries while projects had a combined value of US$179 billion.
in total value of investment needed, in 2024.
This represents an increase of 23% (from US$70 billion in 2023), despite the total number of reported projects being largely comparable year-on-year.
The increase is mainly driven by new project disclosures and cities reporting more projects on average.
Covering 13% of the world’s urban population, the US$86 billion investment demand in cities underscores the urgent need for capital in critical urban sustainable and climate resilient infrastructure and initiatives.
Regions and countries
Sectors
Stage of development and financing status
2. Project opportunities by climate impact: deep dive
While climate mitigation investment continues to dominate, the demand for climate adaptation finance is steadily rising [4].
Mitigation
Climate mitigation accounts for nearly half (US$40.3 billion) of total reported investment needs – a slight decrease from the US$45 billion reported in 2023. Over two-thirds of this demand comes from developed economies.
The 1,419 mitigation projects reported span four key sectors:
Adaptation
29% of all reported projects (721 projects) focus on increasing urban adaptation and resilience to climate change, with a near-equal distribution between developed and emerging markets. While the number of projects remains largely the same as in 2023, the demand for adaptation finance has risen from US$21 billion to US$35 billion – representing 41% of total reported investment needs.
This growing demand underscores the urgency of scaling adaptation finance, particularly in EMDEs where current flows meet only 4% of total annual needs. To meet these needs, greater private investment will be critical. Cities and national governments should continue working with development finance institutions and the private sector to leverage and de-risk private adaptation finance.
Adaptation projects span three main areas:
3. Spotlight on best practice actions
CDP’s data on city climate projects serves as a powerful tool for fostering city collaboration and scaling up best practices in project prioritization, planning, and financing.
The increasing demand for climate finance in cities around the world underscores the importance of sharing good practices and successful case studies. By disclosing climate projects through CDP-ICLEI Track, cities can raise visibility for their investment needs and share actionable insights for others to follow.
This section highlights projects that exemplify best practice actions by cities for all sectors and levels of project development.
Policy alignment
In 2024, nearly half of the cities that disclosed projects (286 cities) linked a total of 958 projects with broader climate adaptation and/or mitigation actions reported previously in the Cities Questionnaire [5].
This indicates that projects are not standalone efforts, but integral components of wider climate initiatives, climate action plans, and targets.
This kind of policy-aligned approach to project planning is important for several reasons. It offers or allows for:
Enhanced coordination and efficiency, preventing duplication of efforts and the efficient use of resources;
Maximized impacts, facilitating projects’ links with established climate goals and strategies;
Improved access to finance with funders and investors preferring to support projects that are linked to a well-defined climate action plan and set of broader climate initiatives; and
Greater community support, in that projects with a clear and shared vision are more likely to be endorsed by the community.
The 286 cities that reported linked projects span all regions and city sizes, and are evenly distributed across developing and developed economies. Additionally, nearly all these cities (91%) have a climate action plan, underscoring the critical importance of urban climate planning for an integrated approach to project development.
Inclusivity and equity
Climate change has devastating impacts across all regions of the world, but it is the most vulnerable populations who are most often disproportionately affected. Therefore, projects in cities seeking to address climate change should be developed in such a way to not further create additional inequities for vulnerable and marginalized communities. Mainstreaming inclusivity and/or equity in project design promotes environmental and climate goals and contributes to community well-being, social justice, and cohesion.
In 2024, many cities reported climate projects that target the most vulnerable. Covering all sectors, these projects focus on gender inclusion, affordable energy for low-income residents, inclusive housing and community infrastructure, health and well-being of vulnerable groups, job creation, geographic inclusion, and support for indigenous and cultural communities. Access to low-cost capital for these types of projects is critical. At the Urban20 (U20) summit this past November, and as part of their US$800 billion ask for annual public investment in urban climate measures, urban leaders and mayors called for at least 40% of concessional funding (grants and loans at low rates) to support city-led initiatives targeting the most vulnerable populations.
Financial innovation
Cities across the globe continue to rely heavily on domestic public funding sources for their climate action. Of the 1,706 projects that included a financing model in 2024, 58% reported that they are seeking or have secured public finance from municipal sources and/or national governments. Only a small proportion of these projects (7%) are seeking finance exclusively from private sources such as commercial banks and investors. And over a quarter of these projects (27%) are considering using both public and private sources of finance [6].
The current availability of public finance alone cannot effectively tackle the climate crisis in cities. The data confirms a clear need for and interest in scaling up both public finance and innovative financing approaches and instruments that can incentivize diversified sources of finance at scale. The 2024 projects data shows that cities, particularly in developed economies, are actively exploring innovative financial instruments to attract complementary sources of investment. These include blended finance structures, green bonds, carbon credits and offsets, grants and financial incentives, zero or low-interest loans, and cooperative financing models. While the project examples below highlight some of these strategies, critical to their success will be to strengthen public financing options for local governments to achieve the best outcome.
4. From data to action: CHAMP endorser countries in focus
Since its launch in December 2023 at COP28, 75 countries have joined the Coalition for High Ambition Multilevel Partnerships (CHAMP) for Climate Action.
The coalition of CHAMP endorsers is supported by a range of partnering organizations, including:
CDP;
the Global Covenant of Mayors for Climate & Energy;
International Council for Local Environment Initiatives (ICLEI);
University of Maryland;
United Nations Development Program (UNDP);
United Nations Environment Program (UNEP)
United Nations Framework Convention on Climate Change (UNFCCC)/Climate Champions
UN-Habitat; and
WRI Ross Center for Sustainable Cities, among others.
The Global Covenant of Mayors for Energy and Climate has advised and supported the CHAMP coalition from its inception. It is committed to support national governments deliver their pledge by providing guidance, resources and support on multilevel governance as well as critical evidence and data on the potential contributions of cities.
As a platform for standardized, comparable and science-based localized data, CDP plays a central role in informing and connecting the right stakeholders for aligned, multilevel climate action. The city data reported through CDP-ICLEI Track can support national governments to better understand local needs and priorities, align their NDC investment strategies, and inform their efforts in supporting and scaling city climate action.
In 2024, 448 cities from 38 CHAMP endorser countries reported a total of 1,929 projects. These projects represent more than three-quarters of all reported projects and total investment needs (US$67.5 billion). Among these, 87% (1,680) are seeking financing and 46% (888) are at early stages of development.
Explore the two case studies below to understand how CDP cities data can support the CHAMP coalition:
Kenya
The Kenyan national government is spearheading collaboration with local governments on nature-based solutions and sustainable urban development. View case study (PDF)
The Philippines
Philippine cities are demanding inclusive multilevel collaboration to achieve adaptation goals and reduce fossil fuel dependence. View case study (PDF)
Calls to action
From reporting on science-based targets to adaptation and mitigation actions, cities’ disclosure to CDP-ICLEI Track demonstrates that they are stepping up to tackle the climate emergency. However, there remains a clear need to support local governments, especially those in emerging markets and developing economies.
Efforts to strengthen multilevel governance are underway through initiatives like CHAMP, which will aim to accelerate climate finance access for local governments by ensuring subnational governments have a seat at the table when national and international policy and finance frameworks are designed, as well as through national government commitments.
To support these goals, alongside essential climate metrics, more robust, accurate and timely project disclosure is critical to bolster cities’ ambitions. This will help identify both replicable solutions and target areas for investment and technical assistance.
To achieve this, CDP and its partners want to see:
A rapid scaling up of climate finance at the local level, to meet the estimated US$4.5 trillion needed annually through 2030 for climate mitigation and adaptation in cities. National governments and development finance institutions should collectively mobilize at least US$800 billion annually in public investment by 2030 to support the extensive pipeline of projects being created, as cities implement their climate action plans and increase their resilience to the impacts of climate change.
The private sector more actively supporting cities in developing the enabling conditions for private investment, collaborating with public financial institutions to drive finance at scale, and contributing to reducing greenhouse gas emissions and climate risks in cities.
Accelerated support for Project Preparation. Stakeholders should provide technical assistance and resources to help cities – particularly in emerging markets and developing economies – to develop pipelines of bankable climate projects that meet the requirements of financiers.
Promotion of Project Aggregation to encourage the bundling of smaller projects to attract larger investments and reduce transaction costs. CDP’s city project data can be a valuable tool for identifying aggregation opportunities at the country and regional levels.
Alignment of national and local strategies. National governments should use city project disclosure data to better align their NDC investment strategies with local needs and priorities. This will ensure that climate finance is more scalable, accessible, and impactful.
The leveraging of multilevel partnerships. Ahead of COP30 in 2025, national governments, along with other stakeholders, must seize the opportunity presented by the CHAMP initiative to integrate subnational climate actions into NDCs and domestic climate investment priorities. This will empower cities to access the capital needed for impactful climate action and effectively leverage their critical role in addressing the climate crisis.
Cities disclosing environmental data and climate-related projects, ideally with increased support from national governments, international financial institutions, and other actors. This way, they can understand risks, opportunities and impacts, and provide enhanced transparency and accountability around projects seeking financing and funding.
What this Snapshot is based on
Each year, thousands of cities across the world are invited to participate in CDP-ICLEI Track, a comprehensive environmental questionnaire powered by CDP, the world’s leading environmental reporting platform. The CDP-ICLEI Track questionnaire captures cities' climate action and resiliency plans, greenhouse gas reduction targets, and actions to mitigate and adapt to climate change.
A critical data point collected in the questionnaire is the number of city climate projects in need of financing and funding. This global Snapshot is based on the self-disclosed responses to CDP-ICLEI Track in 2024, where local governments reported climate-related projects that are currently seeking funding and/or financing. Disclosed projects cover a wide range of sectors, from renewable energy production and low-carbon transportation to building retrofits and stormwater retention.
Project disclosure helps address the widespread standardized data gap on urban climate finance needs. This can better position local governments for robust technical assistance and financing opportunities.
Learn more about CDP’s global work on funding and financing for local and regional climate action.
You can explore the 2024 Full Cities Climate Projects dataset which contains cities’ original self-reported responses to Question 9.3 of the CDP-ICLEI Track questionnaire. This dataset was further cleaned and analyzed by CDP for the purpose of this Snapshot.
If you have any questions, please reach out to us at climateprojects@cdp.net.
Footnotes
This estimate remains very conservative for adaptation needs due to the difficulty in tracking and measuring the cost of adaptation.
For the 2024 data analysis, the nature-based solutions, biodiversity, & urban green spaces sector was created by consolidating several overlapping categories, including public & green spaces, land use, jurisdictional REDD+ programs, and landscape and jurisdictional approaches.
A total of 247 projects seeking US$11.6 in investment fall under the ‘other’ category. These projects cover areas such as climate planning, urban resilience, and education and public awareness initiatives. Many projects in this category also overlap with multiple sectors.
In addition to the mitigation and adaptation projects featured in this section, around 303 projects with an investment need of US$6.5 billion have a dual impact potential – contributing to both mitigation and adaptation. Examples of such projects include nature-based solutions with significant carbon-reduction potentials, waste-to-compost projects, ecosystems restoration initiatives that increase or maintain carbon stocks, building retrofits that target both energy efficiency and climate resilience, and policy initiatives and projects that span multiple sectors.
A reported project may be related to an adaptation or mitigation action reported in questions 9.1 and/or 9.2 of the Cities questionnaire. In that case, disclosers in 2024 were invited to provide a unique identifier for each of their mitigation or adaptation actions and select the appropriate action from a drop-down menu.
An additional 8% of projects with an identified financing model rely on unspecified sources of funding categorized as ‘other’.
In partnership with
This data was collected in partnership by CDP and ICLEI-Local Governments for Sustainability
