What is a carbon budget and how does it encourage climate-conscious decision-making?

Many municipalities approach their climate targets without the proper resources to be realistic Unfortunately, this often results in overspending, falling short on essential needs, and missed opportunities to achieve municipal-wide goals. The greatest example of this is the pledge to reduce greenhouse gas emissions to limit global warming to 1.5 degrees C - all the while, not knowing the limit is on their emissions needed to achieve this target. This is where a carbon budget framework can be critical to transform aspirational net-zero emissions targets into near-term actionable milestones that keep municipalities accountable for their climate objectives. 

This recent article (Mohd Isa, 2025) underscores the importance of how a carbon budget sets a clear cap on emissions, encouraging municipalities to integrate climate considerations into all levels of the decision-making processes. By integrating emissions reduction criteria for instance, into existing policies and placing climate goals alongside financial goals, a carbon budget mobilizes all departments to account for greenhouse gas emissions when developing municipal initiatives, creating more impactful climate solutions and allocating funding more effectively. 

To aid municipalities in the process of creating a carbon budget, the author highlights tools for municipalities to assess emissions and take action to show greater accountability for reaching their climate target, including the C40 Carbon Budget Primer, the Municipal Energy Emissions Database, and the GHG Calculator for municipal projects, among others. 

Establishing a carbon budget increases transparency and encourages climate-conscious decision-making to reach climate goals - a form of leadership that is urgently needed across all cities and towns today. The municipalities that have taken this step to demonstrate accountability in their climate targets are leaders in climate mitigation and adaptation. By integrating carbon impacts and emissions into budget discussions, they set a higher standard for climate action planning and create an example for other municipalities (regardless of the size) to follow. 

Written by Sabrina Careri, for Ann Dale

Image Credit: Callum Shaw from Unsplash