Under a plan developed through the William J Clinton Foundation, participating banks would provide up to $1 billion each in loans that cities or private landlords would use to upgrade energy-hungry heating, cooling and lighting systems in older buildings. The loans and interest would be paid back with savings accrued through reduced energy costs.

Clinton’s foundation has created an arrangement among 16 cities — Mumbai, Karachi, Seoul, Bangkok, Melbourne, Sao Paolo, Johannesburg, New York, Chicago, Houston, Toronto, Mexico City, London, Berlin, Tokyo and Rome. The planned projects include replacing heating, cooling and lighting systems with energy-efficient networks; making roofs white or reflective to deflect more of the sun’s heat; sealing windows and installing new models that let more light in and keep the elements out; and setting up sensors to control more efficient use of lights and air conditioning. Typically, such upgrades are expected to cut energy use and costs from 20 per cent to 50 per cent.

The former president said Citi, Deutsche Bank, JP Morgan Chase, UBS and ABN Amro have each committed $1 billion to finance the upgrades. “If all buildings were as efficient as they could be, we’d be saving an enormous amount of energy and significantly reducing carbon emissions. Also, we’d be saving a lot of money,” he said.

Buildings are among a city’s worst contributors to emissions, accounting for 50 per cent of energy use in newer cities and more than 70 per cent in older urban areas. In New York, for example, electricity, natural gas, fuel oil and steam consumed by buildings make up 79 per cent of the city’s total count of heat-trapping gases, a recent study found.

Clinton announced the partnership on Wednesday, joined by mayors of several of the cities, as part of an international climate summit he is hosting this week in New York City with Mayor Michael Bloomberg. It was the second meeting of the C40 Large Cities Climate Summit, which was created so mayors and local governments could share strategies for reversing the trends of climate change.