Nepali cities must champion climate action

In 2020, the city of Mumbai joined the C40 Cities Network, a collective of 97 cities around the world taking climate action at the sub-national level. Subsequently, the city launched the Mumbai Climate Action Plan in 2022, becoming India’s first climate action plan to set net-zero targets for 2050.

Conversation on international climate policy is often dominated by federal policies and international negotiations with representations most often from national governments. Yet, cities play a critical role to reach the Paris Agreement targets. 

More than half of the world's population, or around 4.4 billion inhabitants, currently live in cities, and this trend is only expected to continue moving forward. By 2050, cities will be home to more than 70% of the world´s population and the majority of its industry. Although cities make up only 2% of our world, they consume the majority of global energy and produce approximately 60% of global greenhouse gas emissions, primarily through the transport and building sectors.

Increasing urbanisation strains infrastructure and services, and eventually impacts sustainability and people´s livelihood. With most of the absolute growth in population taking place in Asia, urban low-lying coastal areas are particularly vulnerable to the effects of climate change. Rising temperatures, sea level rise, and extreme weather events like floods or droughts disrupt the complex infrastructures of cities. High levels of air pollution and waste management burden the livelihood of millions of urban dwellers and exacerbate their existing vulnerability to climate impacts. 

Cities are where most people live and work, where they host businesses and industries and have the best ground-level understanding of the need to balance development and urbanisation hand in hand with tackling climate change. This means cities can also be and need to be, a part of the solution. With cities being policy laboratories and incubators for climate actions, it is vital to change the way cities function while nurturing the narrative that cities can take the initiative to tackle climate change. The decisions cities take to combat climate change today will shape the future.

Kruti Munot, Project Manager at GIZ in Brussels who works with city governments on climate action says, “Cities play a key role in tackling climate change, and there is a continuous need to integrate climate into city planning, scale climate finance for urban infrastructure, and build capacities for local-level leadership to meet the Paris Agreement targets.” 

While the conversation around city-level action on climate change may not yet be mainstreamed, it is happening with efforts undergoing at various levels. According to the Global Covenant of Mayors, there are more than 12,700 cities committed to reducing emissions by 2050, and both the G7 and G20 now have specific high-level meetings on urban topics. 

The Mumbai climate action plan, for example, envisions a climate-resilient Mumbai by 2050 with a focus on mitigation and adaptation strategies in sustainable waste management, urban greening and biodiversity, urban flooding and water resource management, energy and buildings, air quality, and sustainable mobility. 

Mumbai is one of eight South Asian cities that are part of C40 Cities, a global collaboration platform of about 100 mayors from the world´s leading cities, committed collectively to city-level climate actions. Mayors of C40 Cities use a collaborative approach to cut their cities’ emissions in half by 2030, share best practices and facilitate access to finance to improve urban resilience and foster green jobs in cities. 

A traveler visiting Portugal´s C40 Cities member Lisbon might nowadays enjoy an unusual sight during their stopover: Flocks of sheep graze on the city´s meadows. Lisbon faced diverse environmental challenges ranging from droughts to flooding and extreme urban heat and water scarcity. In 2019 the city rolled out a project called life lungs, a city-level climate initiative that aims to make Lisbon greener and “cooler” by accelerating three simple tools: trees and biodiverse meadows, a water management system, and flocks of sheep. 

While a water management plan balances Lisbon´s heavy precipitation and water scarcity, biodiverse meadows and trees were planted to provide more green urban space, shade, and overall combat urban heat islands within the city. On these, meadows flocks of sheep are used as a traditional method to control vegetation and help with soil conservation. 

Cape Town in South Africa tries to connect the dots between city-level climate action, a circular economy, and private-sector engagement. The city runs a local initiative that supports the private sector in identifying and classifying its waste before trying to find ways to reuse it. The initiative has already diverted 100,000 tonnes of waste from landfills while avoiding more than 300,000 tonnes of greenhouse gas emissions. 

Nur Sultan in Kazakhstan counts on its fleet of electric busses while Peshawar in Pakistan has added a 26km bus corridor with park-and-ride facilities, green areas, and bicycle lanes to ease traffic and congestion. Car-free Sundays are another example of city-level climate action all around the world. Jarkata designates every Sunday in one area to be car-free, while Kigali´s car-free day twice a month is part of its efforts to make Kigali a greener city. Initiatives to tackle climate change at the sub-national level are not new and there are many more examples, including from developing Asia, that can be utilised as part of a coherent and inclusive city-level climate action plan and strategy. 

Alongside the focus on reducing emissions by decarbonising the energy sector, advancing waste management, and promoting low-carbon transportation solutions, it is equally important to ensure such action plans incorporate climate resilience and support both climate adaptation as well as loss and damage. 

Global collaborations play an important role in transferring knowledge, and success stories on climate action to build urban resilience through a global network. Platforms such as C40 cities, city-level disclosures through the Climate Disclosure Project, and the Global Covenant of Mayors for Climate and Energy are important to set up frameworks for cities to follow and facilitate city exchanges. 

This conversation is particularly important for Nepal as it has ambitious climate policies such as the nationally determined contribution (NDC) to the Paris Agreement and the long-term strategy for net-zero emissions by 2045. At the same time, Nepal also recognises the importance of local governments to integrate disaster risk management and climate actions, including both climate adaptation and mitigation, under the Local Disaster and Climate Resilient Planning (LDCRP) framework.

Nepal’s Waling municipality has developed a resilience roadmap aligned to Paris agreements and SDGs with an aim to transform the town into a resilient city by 2030 with focus on waste management, creation of green jobs and businesses, saving lives and critical infrastructure from disaster risks and decongesting the core area for more open space and greenery. The municipality is currently managing more than 11 tons of solid waste on daily basis. The work of SDG-sub platform on Sustainable Cities supported by UNDP has recognised sensitivity of functional attributes of cites to externalities and shocks as a determining factor of city resilience. 

However, despite the good intentions behind local-level climate action, there are several bottlenecks that have hindered progress. Some of these include a lack of coordination between central and local government, overlaps and differences between central and local policies, challenges with climate budget allocation, and a lack of technical capacity at the local level to drive climate action. 

Climate policies in the local level are also primarily focused on adaptation and climate resilience, as opposed to climate mitigation. While this makes sense for the majority of local governments in Nepal, Kathmandu Valley’s urban population is growing at around 6.5% annually, indicating one of the fastest-growing urban areas in South Asia. With rising population and emissions, cities and urban areas also need a strong focus on climate mitigation. 

Nepal’s ambitious climate goals and impressive 43% of forest cover means little to the 80% of population who reside in urban areas that are rampant with unmanaged urbanisation and high pollution. City-level climate action is necessary to bring change in urbanised areas that are most in need of climate action. 

Vijaya Singh, Assistant Resident Representative at UNDP Nepal agrees and affirms that “cities and urban centers in Nepal play a critical role in tackling climate change and it is right time for the municipal governments to think of resilient city planning to contribute to emission reduction targets, addressing challenges such as air and water pollution, and provide a host of other co-benefits.”

Cities in Nepal, such as Kathmandu, even have a unique opportunity to support the country's access to much important climate finance which is a key condition for Nepal to meet its climate targets and be resilient to the climate crisis. A clear roadmap and strategy on climate action can help mobilise financing not just through the generation of a bankable pipeline to attract climate finance but also through a variety of financing options ranging from public to private sources of finance. 

Such a strategy can come from the national level as national approaches can be more efficient than city-level actions but needs to be complemented with implementation plans and roadmaps in the city level, tailored to the unique circumstances of each city, to ensure the centralised approach is executed, individualised and taken forward in the local level. 

Suman Basnyat, Infrastructure Finance Specialist and an advisor to a former Minister of Energy, Water Resource and Irrigation, flags that “city-level governments in Nepal still depend on national funding and therefore are spared the fiscal space for large-scale local climate actions. It holds true for all layers of government in Nepal. This fact opens up a huge investment potential for the private sector on city-level climate action but this also needs to be based on reasonable reciprocity of risk and return.” 

Green bonds have emerged as key debt instrument to mobilise climate finance globally, and this conversation is picking up at the national level in Nepal. A green municipal bond is a fixed-income financial instrument for raising capital through the debt capital market. The Green City Bonds Coalition has developed a guidebook on how cities can issue a green municipal bond which can be issued to fund green projects in cities for a range of projects including climate-friendly urban infrastructure, such as low-carbon buildings, metro rail systems, wastewater treatment plants and renewable energy. 

China provides an example of green bonds. With China being the world´s second-largest green bond market, local governments can make use of a green “municipal special purpose bond” to raise money for climate action. These green bonds are not directly issued through the municipality itself but through companies capitalised and owned by the local government such as state-owned enterprises. 

Mathias Lund Larsen, a Senior Research Consultant at the International Institute of Green Finance in Beijing, notes that “growth in the green bond market has been an important contributor to financing China’s infrastructure gap through green financing. At the local level, state-owned enterprises owned by local governments typically are the ones issuing green bonds.” 

Although far-fetched at this stage for a country with a shallow capital market, poor credit culture, and debt-management practice, a clear roadmap can also pave the way for Nepali cities with adequate fiscal capacity to eventually attract financing for climate mitigation actions through municipal climate and green bonds, although a bond is just one instrument as part of the broader financing toolbox. 

Mathias adds, “while ambitious, it is important for city governments in developing economies to understand and ideate the role it can play in tackling climate change and ways to mobilise finance towards that endeavor.”

The opportunities are plentiful for cities in Nepal to drive climate action at the heart of where it is most needed and enable the inflow of critical climate finance to turn Nepal’s ambitious climate policies into a reality. This needs to be complemented by clear recognition of city-level action in national climate policies, with due harmonisation to ensure effective implementation, and tailored roadmaps in the city-level to take this forward.

Starting a conversation is the first step that needs to be followed by significant capacity building efforts to ensure sub-national and city level climate action planning scales up in Nepal and urban residents can benefit from improved climate mitigation and resilience.

Rastraraj Bhandari works on climate finance and carbon markets, and contributes regularly to Nepali Times on issues related to climate change. Simone Weichenrieder works on the intersection between climate resilience, private sector engagement and conservation finance.