Geothermal and hydroelectric already run the city's economy, but the government states that both energy sources have much more productive capacity to tap into. Iceland's renewable energy production has nearly made the country energy independent with respect to heating and electricity generation. No other city has developed a district heating and electrical system using renewable energy resources on the scale of Reykjavik. Iceland also has a world-renowned scientific community in the field of renewable energy R&D.

Reykjavik's Municipal Plan focuses on densifying Reykjavík's urban structure, developing public transportation systems, reducing pollution and preserving green spaces. Roughly nine out of 10 inhabitants live a five-minute walk away from a public green space in Reykjavik.