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Preparing a city for the future

You can imagine the complexities involved when a major city charts a course to cut greenhouse-gas emissions beyond regulatory requirements. The dependencies include public transportation, waste removal, car usage, infrastructure—and just about every other activity within a dense urban area. A strategic balance among reducing energy usage, encouraging technological innovation, and changing behaviors is required.

Preparing a city for the future

McKinsey was uniquely suited to help put together a comprehensive plan—in partnership with the city—there was real urgency behind it, since the city was on course to be more than 50 percent above its emissions target by 2030.

The McKinsey team leveraged our innovative carbon-economics tool, which was designed by us precisely to assess multifactorial impacts of this kind, using a combination of cost effectiveness, feasibility, and impact.

This remarkable computational engine enabled the McKinsey team to determine that through a combination of behavioral and technological measures, the city might be able to abate 2.5 million or more tons of CO2 a year by 2030—on top of its already ambitious “business as usual” target.

The results were encouraging. Overall, the assessment of cost effectiveness, feasibility, and impact showed that the city could make a number of “no regrets” moves, such as retrofitting existing structures, introducing variably priced parking, and increasing recycling and composting. Other measures would require further analysis of the economic and other impacts, as well as benefits such as health, safety, and productivity. Some measures needed pilot projects to test their effectiveness.

McKinsey’s work left the city with a direction for implementing a bold strategy to attain its targets and thereby become a global model of urban transformation.