Cities consume most of the world’s energy and generate the majority of greenhouse gas emissions. Yet urban areas - especially in low‑ and middle‑income countries - are also frontline implementers of climate solutions.

A new white paper from the UN Industrial Development Organization (UNIDO), The City‑Industry‑Climate Nexus: Cities as Engines of Global Net‑Zero Transitions in a Shifting World, argues that decarbonizing cities is not only environmental policy but a strategic industrial agenda. By concentrating people, infrastructure and industries, cities are pivotal arenas where net‑zero transitions must take shape.

“Decarbonization is not just about solar rooftops and electric buses,” said Olga Rataj of UNIDO’s Division of Energy and Climate Action. “It is about transforming the urban‑industrial systems that power daily life - from the production of cement and steel, textiles and food, to waste management, logistics and cleantech.”

The white paper introduces the city‑industry‑climate nexus, where infrastructure, production systems, value chains and climate action converge. UNIDO applies systems thinking to urban decarbonization by integrating policy, technology, finance, partnerships and data across energy, transport, buildings, water and waste. This holistic approach links industrial transformation with urban climate action, positioning cities as engines of innovation and resilience.

To strengthen urban‑industrial decarbonization, the paper calls for:

• Municipal finance reform to unlock scalable investment

• Market incentives and green public procurement to drive demand for low‑carbon solutions

• Innovation ecosystems that support MSMEs, start‑ups and cleantech deployment

• Green skills development to empower local communities and youth

UNIDO emphasizes that cities are not only sites of risk but also strategic arenas of opportunity. By aligning industrial transformation with climate action, urban communities can lead the way toward inclusive, resilient and net‑zero futures.