Eco-cities = Sustainability, dynamism + liveability

• Sustainability enhances city attractiveness to companies and quality workforce
• Funding issues managed with government as facilitator

By Celia Alphonsus

Twenty years ago, New Zealand’s Waitakere City elected advertising maverick Bob Harvey as its second mayor on the strength of his vision to create an eco-city. Harvey and his city were ahead of the curve; at that time, environmental issues were only just starting to become an international concern.

“We rode the trends and were first off the block,” says Harvey, recalling council initiatives to restore local ecosystems and build libraries in cooperation with the Maori community – examples of initiatives characterising the “Waitakere way” of sustainable local collaboration that remains a benchmark of government eco-stewardship to this day.

Harvey galvanised the people’s collective conscience and served as mayor for a record 18 years until 2010. But even he has to admit that the task of implementing a sustainable city agenda is today “more difficult and complex”.

The desire to protect Mother Nature is no longer the only driver for creating more sustainable and liveable cities. While citizen activism continues to push change and influence policy, local governments and city planners are increasingly tapping on the economic advantages to be gained by creating sustainable cities.

The State of Green Business Report 2012 says cities are pushing forward regardless of national policies that leave sustainability measures simmering on the back-burner. “Some of the world’s largest cities are emerging as laboratories of innovative technologies, business models and efficiency measures, many of them with impressive environmental and social outcomes. It is becoming evident that a bottom-up, grassroots evolution towards sustainable eco-cities is likely,” the report says. 

Global competition

Boon Che Wee, chairman of the Malaysian Green Building Index accreditation panel, observes that it is global competitiveness that is driving the growth of sustainable cities. “Farsighted pioneer sustainable cities clearly now have significantly greater competitive edge in attracting investment and talents,” says Boon.

“Farsighted pioneer sustainable cities clearly now have significantly greater competitive edge in attracting investment and talents.” – Boon Che Wee, chairman of the Malaysian Green Building Index (photo credit: Pertubuhan Akitek Malaysia)

A survey by the Carbon Disclosure Project and KPMG of leaders of 58 cities around the world, representing 8% of the global population, found that nearly eight in ten believe the physical impacts of climate change directly or indirectly threaten the ability of local businesses to operate successfully. As cities compete to attract companies and a high-quality workforce, sustainability will likely be a part of their competitive strategies.

As the State of Green Business Report states, cities are gaining enormous power to create markets for both local and sustainably produced goods and services, in some cases helping create economies of scale that make these things cheaper and more widely available. The domino effect of such efforts is that sustainable cities become more desirable places to live in, shop and work, attracting employees and customers, which in turn attract investors like bees to honey.

Energy retrofit 

A case in point is Amsterdam, among the world’s oldest and largest cities and a pioneer in going green. A pristine city with historical architecture and canals snaking through town, Amsterdam already appears every inch the eco-city of the future. However, deep in the underbelly of its infrastructure, there are ongoing efforts to transform it into an ultra energy-efficient city. 

Amsterdam, Netherlands: The city will spend 100 million euros annually until 2016 to upgrade its electricity networks to smart grids

In 2009, Cisco, IBM and Nuon launched an energy management project to run in 500 households. The aim was to cut energy usage by 14% and significantly reduce CO2 emissions as well. On top of that, over 700 households have been given access to financing by some major Dutch banks to buy energy-saving appliances, bulbs, roof insulation and other building retrofitting measures. 

The city also plans to install solar panels on townhouses and several hundred power hook-ups for electric cars to recharge. Solar panels on riverboats along the canal are not an uncommon sight either. Until 2016, 100 million euros (US$132 million) will be spent yearly by the city upgrading its electricity networks to smart grids that will effectively lower energy consumption.

Future of Asian cities

According to a report by the Asia Business Council in 2010, aggregate populations in Asian cities have almost doubled in the past 15 to 20 years and by 2030, more than half of the world’s urban populations will live in Asian cities. If urban growth is not managed well, cities will suffer from overcrowding, traffic congestion, worsening pollution and pressures on infrastructure. 

The future quality of life in fast-developing cities depends, therefore, on how urban communities tackle these challenges. Traditionally, governments were responsible for mitigating these problems but budget constraints, bureaucratic processes and politics can delay intervention for years. 

Many great cities in North America and Europe fell into urban decay in the 70s and 80s as governments were slow to address problems in these areas. If Asian cities do not learn from these mistakes, they, too, risk de-urbanisation, unemployment and population flight, leaving behind neighbourhoods with stagnated economies, dilapidated buildings and deteriorating infrastructure.

Funding the future

How fast entire cities can adopt a long-term sustainability game plan and stick steadfastly to it, however, will depend on the availability of funds. Developing Asian cities often lack the financial capability to scale up projects, and initiatives are usually painfully slow to take off even with help from international institutions like the Asian Development Bank (ADB) and the World Bank. In poorer countries, there are also competing priorities like tackling poverty and improving basic infrastructure. 

However, where funding is a main concern, there is a lot to learn from the advanced economies, which have come up with some innovative schemes to nudge projects along. There are some good examples:

• London’s RE:FIT programme to retrofit public facilities is financed by a combination of regional funding initiatives and private banks, and from money saved through greater building energy efficiency. (See story on following page.) 

• Singapore’s Building and Construction Authority (BCA) launched a Building Retrofit Energy Efficiency Financing (BREEF) pilot scheme last September. By collaborating with financial institutions (FIs), BREEF helps facilitate loans of up to S$5 million (US$3.95 million) for commercial building owners and energy services companies (ESCOs) to carry out retrofits under an energy performance contract that specifies a minimum level of energy savings to be achieved. Under the scheme, BCA shares the risk of default with the FIs issuing the loans. Current participating FIs are Standard Chartered Bank and United Overseas Bank. (See www.bca.gov.sg for details) 

“The economic growth of Asian cities is heavily dependent on the private sector contributing where governments canot.” – Vind Sidhu, senior vice-president of Siemens Malaysia (photo credit: Siemens)

The economic growth of Asian cities is heavily dependent on the intervention of businesses and the private sector to contribute where governments cannot. According to Vind Sidhu, senior vice-president of Siemens Malaysia, countries in Asia and Pacific need to spend 6–7% of their gross domestic product (GDP) on infrastructure to ensure economic growth. However, public sector investment averages just 3–4% in many developing countries, resulting in a substantial investment shortfall.

”Vind points out that roughly two-thirds of the CO2 abatement potential that could be addressed by currently available technology would pay for itself through energy savings generated over a reasonable time frame. The key issue, however, is inadequate funding for such ventures. 

“Assurances in financial returns by accurate calculations of ROI do seem to be a prospective solution in attracting funding and investments,” says Vind. “Also, demonstration pilots of a larger scale can be implemented to convince stakeholders on tangible benefits.

As the pressure to contribute to national GDP growth builds up, city administrators everywhere in the world will need to put on their thinking caps to design better ways to get the private sector to collaborate on the serious business of creating sustainable cities. Their ability to compete regionally or globally may well depend on it. 

1 Vancouver (Canada): The city consistently tops the World Liveable Cities list. It draws 90% of its power from renewable sources and has developed a 100-year plan for sustainability.

Curitiba, Brazil: The city boasts of over 53 sq m of green space per inhabitant

2 Curitiba (Brazil): Architect Jaime Lerner, who was mayor in the 1970s, transformed the mid-sized Brazilian city into a model for other metropolises. Over 80% of its residents use public transport and the city boasts over 580 sq ft (53.9 sq m) of green space per inhabitant.

3 Freiburg (Germany): Eco-housing, car-free streets and socially-conscious neighbours have made the city a shining example of sustainability.

Copenhagen, Denmark: Over a third of Copenhagen’s citizens take the healthier, greener route by cycling to work or school evey day

4 Copenhagen (Denmark): A model city for other metropolises in Europe. Apart from being  the city of bicycles, it has managed to keep its water and energy consumption constant. It has also revitalised its harbour, which was once heavily polluted.

Singapore: The island state plans to green 80% of its buildings by 2030

5 Singapore: Named greenest city in Asia by Siemen’s Asian Green City Index 2011, it has attracted multinational companies (MNCs) to base their regional headquarters there. Many MNCs have strict corporate sustainability measures and the wide availability of green office buildings and infrastructure make Singapore an attractive choice. 

Sustainability initiatives by some cities around the world

• SEOUL plans to retrofit 10,000 buildings by 2030

• AUSTIN has a zero-waste plan for 2040

• LONDON aims to have 100,000 electric vehicles on the streets by 2020

• BUENOS AIRES is implementing a network of dedicated bus and taxi lanes to improve fuel efficiency

• TOKYO is introducing higher energy efficiency standards for large urban developments

• SAO PAULO plans to reduce the use of fossil fuel on public transportation by 10% each year, aiming for 100% use of renewable fuels by 2017.

Note: These cities are part of the C40 Cities Climate Leadership Group, a network of large cities committed to implementing climate-related actions at the local level.

Source: Carbon Disclosure Project