On financing of urban transition viewed from the Oresund area: When the political agenda of urban transition meets the market

Abstract

The "urban transition" agenda is as a conglomerate of ambitions derived from international policy documents and as applied in the Oresund area. Encompassing locally set goals for (i) climate change mitigation; (ii) energy efficiency; and (iii) human wellbeing in the built environment. Its implementation is largely dependent on private sector joining in, since transitioning the building stock is to be financed by the market. This paper explores strategies to meet this agenda in the Oresund area. A particular focus is on the refurbishment of multi-family housing relative to these set goals. The paper finds meaningful differences between Denmark and Sweden. In general, exceptionally high energy standards come at an additional cost that is likely to be incompatible with rational economic behavior. Furthermore, actions appropriate for one goal are likely to have modest effects on ancillary goals. The paper concludes by suggesting to revisit current strategies in the Oresund area to reflect market constraints and to promote more coherent ways to achieve the set goals.