Sounds like a great idea. If there is anything structured in place, “ESG” (environment, social, governance) would be the keyword. Some time ago individual equities got ESG scores for ethics. It was gamified by marketing. E.g. Microsoft got a high ESG score despite being atrocious. But Canada is taking real moves toward killing off the greenwashing and forcing provable measurements. So we can perhaps expect ESG figures to be relatively honest in Canada.

From there, I have no idea about mutual funds and I did not even know that muni bonds existed. It would indeed be useful to invest in green cities. It would be quite hard to find them in the US. But I don’t suppose anything stops a US resident from investing in Copenhagen bonds, if they exist.

I think it was Atlanta, GA which built a pedestrian + cycling ring in the city. I don’t know if that was just a 1-off gesture move, or if they continued to develop along those lines.

The closet thing I've discovered is a bond on the Australian stock exchange, titled ASX:AEBD

It's invested in the Australian federal government, several provinces of Canada (Ontario, BC, and Quebec), and a few other places I don't recognize:

• https://stockanalysis.com/quote/asx/AEBD/holdings/

The fund manager (Betashares) describes the fund as follows:

AEBD aims to track the Bloomberg Australian Enhanced Yield Ethically Screened Composite Bond Index (Index), before fees and expenses. Bonds in the Index are screened to exclude exposure to activities associated with significant negative environmental, social and governance (ESG) factors

Though not municipal, this same company also manages another fund (GBND), whose description says

GBND aims to track the performance of an index (before fees and expenses) that comprises a portfolio of global green bonds (using the definition applied by the Climate Bonds Initiative), issued specifically to finance environmentally friendly projects

The GBND fund appears to only include the EU and European countries (namely France, Italy, and Germany), but the mention of Climate Bonds Initiative might be key to discovering similar funds that invest in actual green cities' bonds

• https://www.climatebonds.net/