This paper designs and solves a theoretical model in the light of the new economic geography to assess the role of urban land use in driving local energy consumption pathways that affect global climate change. To inform on the urban economic sectors of climate pressure we offer new modeling arguments and take the next step of testing them in simulations using computable general equilibrium (CGE) model for international climate policy. The exercise of embedding urban economies in a CGE framework is operationalized on the U.S. context. Both the modeling arguments and the simulations indicate that setting spatial policies for the control of long-run density patterns of cities is beneficial strategy to curtail national dependence on energy imports. When faced with international climate agreement that sets targets on carbon emissions, the national government may resort to urban infrastructure policies to offset the cost of an exogenous carbon tax
