Many cities around the world have adopted climate neutrality targets, and, to reduce their greenhouse gas emissions, they need climate action plans. Energy system optimization models (ESOMs) can be used as tools to support their energy transitions. ESOMs have been in use at the national level for several years and also have recently been used at the city level. Even though several researchers have focused on how city ESOMs can be developed, the literature lacks a discussion of the challenges that are faced in data collection during model development. In this paper, we share the challenges encountered in the model development, as well as in the scenario development and recommend practical solutions for overcoming these challenges. The following three challenges were identified and discussed in the model development process: (a) data availability and quality; (b) communication; and (c) knowledge and background of civil servants and researchers. The main challenges in the scenario development were: (a) parameter selection and (b) complexity. It was found that explanation of the terminology used in ESOMs, presentation of the model structure and preliminary base-year results were crucial actions for overcoming challenges during model development. During the scenario development, collaboration between modelers and civil servants when reviewing parameter combinations and working with preliminary scenario results were decisive strategies for improving the civil servants’ understanding of ESOMs. Complementarily, it was found that continuous communication between the researcher and the civil servant and good comprehension of the model on the municipality's side helped improve the usefulness of ESOMs in cities’ energy transitions.