New McKinsey index rates urban China's sustainability progress

With its massive, fast-growing cities, the world's second largest economy will stand as an example of what to do -- and what not to do -- when planning smart cities.

As urban development continues apace around the world, one thing that sustainability watchdogs are following closely is how cities are actually performing when it comes to desirable outcomes such as clean water, efficiency transportation options, quality of life and so on.

McKinsey has dedicated some resources to measuring this, and its initial work has shown up in a sustainability progress index focused on cities in China. It picked the country because of its "staggering rate of urban growth." (In 2008, there were approximately 600 million people in China, by 2030, the population should top 1 billion.) So far, its prognosis is that China's cities do not meet generally accepted worldwide sustainability, although some of them are progressing toward that goal.

McKinsey's new index looks at 112 cities in all, studying them in five different categories:

  • Basic needs, including access to water, education and adequate health care
  • Resource efficiency, which highlight resource management programs, such as waste recycling and water usage
  • Environmental cleanliness, covering policies that limit harmful pollutants and waste management
  • Built environment, focusing on clean transportation, green areas and building efficiency
  • Commitment to the future, which follows human and financial resources that are applied to sustainability and innovation

According to the index, here is where the country has done well or is improving, so far:

  • Water supply
  • Education
  • Wastewater treatment
  • Managing urban density
  • Mass-transit usage

But McKinsey notes there have been "starker trade-offs between income and the environment." As you've doubtless read elsewhere, China is still very reliant on heavy industry and its environmental policies haven't yet caught up with its rate of growth. Even though it is reducing sulfur dioxide emissions, they remain well above acceptable world standards, McKinsey reports. Electricity usage also remains higher per unit of gross domestic product than many other places in the world.

In the article about the index, McKinsey director Jonathan Woetzel notes:

"Yet, China's cities approach these challenges with two notable advantages. First, they have relatively high densities, so government investment in improved public transportation and 'smart grid' technologies is attractive. In addition, there are concrete indications that China's leaders are committed to improved sustainability. Almost three-quarters of the cities in our sample, for instance, increased funding for environmental protection between 2005 and 2008."

Another positive sign, Woetzel reports, is that approximately one-third of the cities in the study were able to grow even while improving their overall triple bottom line performance, with an idea to people, profit and the planet. All of those cities had focused on the following: land renewal reusing "brownfields," green urban planning (especially smart transportation) and large-scale recycling. The city governments in those urban areas also supported a high degree of coordination across various agencies.

Of course, that still means there is another group of cities that is danger of falling behind. That's another great reason to consult this index: as it will offer some insight as to what to do -- and what not to do -- when planning smart cities.

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