Oslo – a Systematic Approach to Creating a Green and Sustainable City


In 2019, the European Commission awarded the City of Oslo the title of ‘European Green Capital’ and placed top in eight of 12 categories, including local transport, air quality, and biodiversity. Oslo went from eighth in the ‘Sustainable Cities Index’ in 2018 to first in 2022.

Oslo (population of 709,000) was cited in 2016 as the first city in the world to establish a Climate Budget. The latter integrates climate targets into the city’s financial budgets to ensure that the city government focuses on where it can cut emissions and enables a coordinated approach.

Whilst Oslo’s previous Climate Budgets focussed on direct emissions, the 2024 budget has been widened to include indirect emissions, consumption, and efficiency measures.

Areas of Focus

The Climate Change Budget helps ensure that all city departments are held accountable for their climate goals. However, with 61% of Oslo’s emissions derived from transport, the city’s focus has been reducing emissions in the transport sector.

Improved public transport, increased cycling lanes, and walking routes were prioritised. Since 2023, Oslo has operated a fully electric public transportation network, with circular recycling as a requirement in electric bus tenders.

Between 2025 and 2020, parking spaces equivalent to 4,250 cars were removed, and 50 kilometres of cycling lanes were established. This has led to the creation of more green spaces and pedestrian zones within the city centre.

Diesel and petrol cars are restricted through a congestion charge that mirrors London’s Congestion Charge and ULEZ (Ultra-Low Emissions Zone). As EVs are exempt from this charge, there has been a considerable increase in their use, with recent estimates that around 60% of all new passenger cars sold in Oslo are electric. Other incentives for EV cars include free parking/charging and the use of bus lanes.

Reduction of GHG in construction

Another major initiative that Oslo’s city government has implemented to reduce emissions is leveraging public procurement as a strategic tool for meeting climate goals. In 2017, Oslo committed to sustainable procurement with a key focus on the construction sector, which was cited as responsible for 7% of the city’s total emissions and contributing to air and noise pollution.

Public procurement has been used to help develop the low-carbon construction market by supporting schemes such as incentives for the sector to invest in zero-carbon heavy-duty vehicles and machinery. Tender criteria for all municipal construction projects require, at minimum, the use of construction machinery and vehicles running on sustainable fuels or biogas. In September 2019, the first zero-emission urban construction site began operation in Oslo, using only electrified construction equipment.

Sustainable Regeneration and Science Park Developments

Oslo has also ensured that regeneration projects, such as the Vulkan neighbourhood development, are developed sustainably. This former industrial site was regenerated into an energy-efficient district with geothermal wells, solar water heating systems and hotels that recycle energy from cooling systems and elevators.

The move to net zero is considered not only for residential schemes but also for commercial and business park developments. Oslo Science City represents a new development designed to be a net zero emission area using renewable energy and circular economic principles. The 1.4 million sqm development is already home to the University of Oslo (one of Science City’s founders), Oslo University Hospital, and 300 start-up companies.

Creating a Strong Research & Commercial Base relating to Clean Energy

To further position the city as a key centre for energy and the environment, a new campus is being established as part of Oslo Science City to house The Norwegian Geotechnical Institute, the Norwegian Institute for Energy Technology, the Norwegian Institute for Water Research, and the Norwegian Institute for Air Research. Having these four institutions co-located on the same campus will enable strategic cooperation on research and innovation within climate, energy and the environment.

The presence of these institutes, the University of Oslo, and a range of cluster organisations, like H2Cluster (hydrogen), NoWaste (circular economy), and Construction City, Oslo, provides a strong ecosystem of green entrepreneurs, researchers, and investors.


Oslo’s city government's creation of a climate budget has led to a strong and consistent vision for developing a green and sustainable city. Oslo has set out to ensure that the city thrives in related aspects, such as social and economic—such as the development of a notable energy cluster at Oslo Science City.

Oslo’s 2016 Climate Budget missed its target to halve GHG (Greenhouse Gas) emissions by 2020, and the 2019 budget is similarly now at risk of not all being delivered. However, in 2022, Oslo’s GHG emissions were 30% lower than in 2009, and air quality significantly improved.

Other recently introduced Climate budget cities include Barcelona, Berlin, and Milan. Most recently, the Greater London Authority Group established 2023-2024 Climate Budgets.

Whilst Oslo and other cities have had challenges in meeting their Climate Budget targets, Oslo’s systematic and consistent approach has led to Norwegian energy and climate tech companies attracting more international investment, with Oslo Business Region citing an increase in climate-related investments of 60% just from 2021 to 2022 in Oslo.

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