Green Cities

Asia's cities have been the drivers of the economy and have lifted millions out of poverty. However, the environmental consequences of this rapid development are apparent, and the citizens of Asia's urban areas are increasingly insistent that something should be done. And there is an investment deficit in Asian cities' infrastructure spending, mostly in environmental infrastructure, of some $100 billion per annum.

Asian cities can be more environmentally friendly. The resources are there to achieve this. Up to 80% of gross domestic product today comes from urban areas in Asia, and its megacities are nation-sized in population and economic product. New cities, such as the innovative 'eco-towns' in Japan and 'eco-cities' in the People's Republic of China (PRC), have begun to put into action a sustainable urban development model.

ADB's Role

To support its developing member countries in more sustainable urban development, the Asian Development Bank (ADB), under its new Urban Operational Plan, will analyze the urbanization process in the context of a country's economic development and identify the main environmental, social, and economic development issues relating to the urban sector - as well as how ADB can add value in the sector - and the proposed areas of investment focus.

ADB will endeavor to develop longer-term engagements in focus urban regions. This will provide the opportunity to develop an integrated plan based on assessments of the environmental, social, and economic priorities for these regions. The assessment process will identify the key environmental issues of a city and prioritize investments to address them in an integrated way across infrastructure sectors to achieve a Green City. ADB, together with public and private partners, will be involved in investments in water supply, waste water, solid waste, district heating/cooling, urban transport (including roads), and energy efficiency. Under ADB's Urban Operational Plan (2012), a number of innovative financial products are proposed in support of the transition to Green Cities. These include:

• guarantees for green investments to be used by national public or private financing institutions; and
• preferential public sector lending in support of clean energy, green transport, and green buildings.

Conclusion

Currently, the notion of Green Cities exists in the real world in the form of individual experiments with Green City technologies that are more or less equally distributed across the world's regions. This bodes well for the scaling-up of such technologies, particularly in rapidly urbanizing Asia. The fact that the region's population densities are expected to grow substantially over the coming decades suggests that scale economies could significantly reduce the costs of transitioning to green technologies, thus incentivizing their uptake on a large scale.

Transformation of today's cities will not occur overnight. Global-scale application of green technologies is thus likely to be an evolution rather than a revolution. But as the rapid spread of communications-based products has demonstrated, new technologies can spread very quickly, particularly when costs fall rapidly, thus enabling scale economies in production, and hence decrease in price to levels that make such products affordable on a mass scale. Furthermore, as the continuing transformation of the older industrial urban areas of Europe and the United States has demonstrated, industrial blight and dilapidated buildings can be replaced within a few decades. This suggests a similar trajectory of transition to green city status for Asia's urban areas, once affordable green technologies come to market and consumer preferences turn toward products based on such technologies as a result of their quality, low cost, and inherent environmental benefits.