Compact Cities Electrified: Energy Outlook
About
The 2026 energy crisis bears notable similarities to the 1970s oil crises. Faced with fuel shortages and economic disruption, many countries pursued structural changes rather than short-term fixes, investing in efficiency, alternative energy, and reduced dependence on oil. France and Japan, for example, enacted policies to incentivize low-carbon, more efficient energy systems that reduced reliance on oil and gas. These long-term investments left both countries better positioned to withstand future energy price shocks and supply disruptions.
This publication from ITDP and UC Davis, supported by the FIA Foundation, shows that smarter policies for urban passenger transport can help major nations dramatically reduce vulnerability to oil shocks, while saving money for both governments and individuals, improving air quality, and increasing road safety. The study investigates six countries (Brazil, China, India, Indonesia, Mexico, and the United States), which contain nearly half of the world’s population. The countries represent a variety of oil and gas producers and importers, and five of the six are low- and middle-income countries. This research examines four possible scenarios for urban passenger transport and presents a first-of-its-kind global and country-level analysis of their potential impacts on fuel consumption: Business-as-Usual (BAU), Mode Shift Only, Electrification Only, and a combination of Electrification + Mode Shift.
This report shows that the Electrification + Mode Shift policy scenario alone can reduce annual fuel consumption in urban passenger transport by 70% and liquid fuel demand by 85% in these six countries by 2050. For both net importers and net exporters, this demand reduction would significantly lower gross oil and gas imports across all of the Electrification Only, Mode Shift Only, and Electrification + Mode Shift scenarios.
However, only combining electrification and mode shift policies can deliver the greatest impact, because each can serve as an insurance policy for the other if efforts fall short of expectations. Ultimately, reducing oil and gas dependence in the urban transport sector not only lowers energy demand, but it also directly reduces exposure to global supply shocks, improving economic resilience. In some cases, aggressive policies that promote sustainable planning and electric mobility would dramatically reduce oil and gas imports, with huge economic savings for importing countries.
Learn More
- Continue Reading on the ITDP Blog →
- Read “ITDP’s Response to the 2026 Energy Crisis” →
- Download the “Compact Cities Electrified: Benefits of Smaller Vehicles” report →
- Download ITDP’s “Compact Cities Electrified” report series →
- Explore ITDP’s Atlas of Sustainable City Transport for mobility indicators →
- Learn more about ITDP’s 2030 Strategic Plan →
