Advancing Climate Neutrality in Cities through Climate Budgeting

Advancing Climate Neutrality in Cities through Climate Budgeting

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The EU's ambitious target of achieving climate neutrality by 2050 necessitates robust mitigation strategies, particularly at the urban level. Local authorities, however, often face significant challenges such as data scarcity, lack of tools, knowledge gaps, and limited resources and political backing. To address these issues, the Climate-4-CAST project offers a comprehensive solution to streamline climate budgeting and enhance data-driven decision-making processes for achieving climate neutrality.

Climate-4-CAST, launched in November 2023 and co-funded by the Interreg Baltic Sea Region Programme, is led by a consortium of 10 partners from Denmark, Finland, Germany, Latvia, Poland, and Sweden, with support from 14 Associated Organisations. The project focuses on developing and piloting an open-source Climate Action Decision Support (CADS) Tool in six diverse cities across the Baltic Sea Region: Tampere (FI), Aarhus (DK), Riga (LV), Östersund (SE), Norderstedt (DE), and Bytom (PL). This tool empowers municipalities by enabling them to visualize climate actions, integrate these actions into budgetary planning, and track outcomes, thereby facilitating climate budgeting implementation and bridging gaps between climate experts and decision-makers.

The first pilot phase, completed in February 2025, focused on data collection and climate action modelling across various sectors, including energy systems, municipal consumption, agriculture, and building efficiency, with a particular emphasis on the transportation sector. Each pilot city has made significant progress in line with its local climate policy and governance framework conditions:

  • TAMPERE has integrated emission inventory data from all sectors – building heating, transportation, electricity consumption, waste, and agriculture – into the CADS Tool. The current model encompasses initiatives such as transitioning to LED streetlights, developing renewable electricity production, and implementing energy efficiency renovations in buildings. Furthermore, Tampere has dedicated significant efforts to enhancing its climate budgeting process, that ensures adequate funding for climate measures and the achievement of the city's climate neutrality target. The CADS Tool plays a pivotal role in identifying cost-effective climate measures for the city's decision-making.
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Tampere's pilot action group members in the group photo

On the photo: Tampere's pilot action group has worked intensively to further improve the city's climate budget. The group members from left: Hanna Meriläinen (project manager), Silva Vuopponen (climate and energy specialist), Anna-Maija Väänänen (controller) and Emmi Nieminen (development specialist). ©City of Tampere

  • AARHUS integrated high-quality climate data and key measures into the CADS Tool, including renewable energy expansion, afforestation, and organic soil management. These efforts have influenced the city’s political budget and climate action plan for 2024. Aarhus also employed the tool to identify cost-effective pathways for achieving its climate neutrality targets, using marginal abatement costs to prioritize the most cost-efficient initiatives. The city's engagement with the tool has led to tangible changes in its approach to climate planning, demonstrating the tool's potential to drive meaningful policy adjustments.
  • RIGA integrated its emission inventory into the CADS Tool, testing the tool’s functionalities by adding climate actions from the Climate City Contract. These include data on municipal infrastructure, transportation, and multi-apartment buildings. The city has made progress in gathering feedback from stakeholders and is working to expand the tool’s scope to cover all key sectors outlined in its Climate Action Plan. While the assessment of emissions from new projects is not currently included, Riga sees potential in using the tool for this purpose in the future. Riga's use of the tool highlights its potential to engage stakeholders and drive collaborative climate action.
  • ÖSTERSUND concentrated on the transport sector, as it accounts for the majority of emissions in the municipality, and made significant progress in collecting data and developing emission models for other areas of municipal consumption, including energy use, waste management, agricultural emissions, and road maintenance. The city also started developing emissions estimates for internal commuting to support workplace sustainability measures. Östersund explored measures related to the thematic master plan for mobility, aiming to test the tool's functionality for decision-making purposes. The city's efforts illustrate how the CADS Tool can support comprehensive climate planning across multiple sectors.
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Partners participating in the online meeting

On the photo: Project Team in Östersund explores climate action scenarios using the CADS Tool. ©City of Östersund

  • NORDERSTEDT piloted the CADS Tool for climate actions in stationary energy and agriculture, including the conversion of street lighting to LEDs and an annual tree donation initiative for citizens. Norderstedt has worked closely with the local energy provider and aims to facilitate political discussions on climate policy as part of the piloting activities. The city's environmental committee has been informed of the possibility of the baseline tool replacing the current methodology for calculating Norderstedt’s carbon footprint. The city also assessed and identified additional measures for modelling with the CADS Tool, such as refurbishments in the stationary energy sector, support for private household energy upgrades, and reforestation in the agriculture sector. Norderstedt's approach demonstrates the tool's versatility in addressing diverse climate challenges.
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Aerial view on the energy-efficient school refurbishment project in Norderstedt

On the photo: Example of a climate action modelled with the CADS Tool: Energy-efficient school refurbishment project in Norderstedt. ©City of Norderstedt

  • BYTOM tracked CO2 emissions by comparing data from 1992 and 2002 to the present, gathering baseline data across key sectors such as buildings, housing stock, heat sources, public transport, and energy consumption. Bytom also defined indicators to assess the impact of investments, such as grants for replacing coal and gas-fired cookers with heat pumps and PV installations. The city's work underscores the importance of historical data in informing current and future climate actions, showcasing how the CADS Tool can facilitate long-term planning.

As Climate-4-CAST advances into its second pilot phase from March to September 2025, the focus will shift towards deeper integration of the CADS Tool into the local governance and budgeting processes of the pilot cities. This phase aims to enhance the tool's usability, expand data inputs, and actively engage stakeholders from partner organisations and the broader region.

To amplify the impact of Climate-4-CAST, the project will launch a series of transfer activities, beginning with the Climate Budget Summit in Malmö on 1 October 2025. This summit will convene experts from across the Baltic Sea Region to explore strategies for reducing GHG emissions and achieving climate neutrality in urban environments. Additionally, a transnational training course for professionals will be launched during the summit, focusing on technical and strategic aspects of climate budgeting.

Through these initiatives, Climate-4-CAST aims to foster transnational collaboration, drive effective climate action, and promote the adoption of climate budgeting practices across the Baltic Sea Region and beyond. The project is committed to ensuring that urban climate strategies are innovative, data-driven, and impactful, providing a robust framework for climate professionals to advance their efforts towards climate neutrality.