19 April 2011: The Organisation for Economic Co-operation and Development (OECD) and the think tank CDC Climat Recherche co-organized a conference titled “Cities and Carbon Markets,” during which participants addressed the potential role of carbon markets as a new source of finance for urban low-carbon investments.

Underlining that cities consume one-third of global energy and produce one-third of global carbon emissions, the OECD stressed that for cities to realize their large reductions potential, they have yet to tap carbon markets as sources of finance. Urban projects currently count for only 10% of carbon market-financed projects. Conference participants discussed how cities can use carbon markets to finance up-front costs of expensive greenhouse gas (GHG) emissions reductions of, for example: regulating building energy-efficiency; improving public transportation; funding “smart grids;” and improving waste management. Participants further emphasized that existing carbon markets are not explicitly designed with urban projects in mind, and that political will and policy coordination across all levels of government are needed for such projects to succeed. [OECD Press Release]