You are absolutely right that this contributes to warming up. But it's just a very small part in this.There is far more truth in that than many will realise. Population is a significant source of heat pollution so population growth is a serious issue - even before you add in the heat from all the farming and transport etc etc etc..
When I was in school in 1957, aged 13, the International Geophysical Year, we had to do an IGY science experiment. Remember we were all war babies and much smaller than the current generation because in our critical first years rationing was in force.
My class did an experiment where all the children were weighed, the lightest, heaviest and the nearest the average were all sealed into a cardboard box each with a thermometer sticking out the side and we timed how long each student took to raise the temperature inside the box by x degrees. We then had to determine how much heat, in btu's each student was emitting.
It worked out that the typical student was emitting the very close to the same amount of heat as a 60 watt incandescent light bulb and that the heat emitted by each child was proportional to their weight. To validate the results a 60 watt incandescent light bulb was sealed in one of the boxes and this showed our calculations were correct.
Those of you aged over about 50 should be able to remember how hot those things were. I would say the average modern 13 year old probably radiates about the same heat than a 100 watt light bulb.
Now add to that the fact that many of those people require air-conditioning to keep their personal environment at the temperature they prefer and that all this heat, plus the heat generated by the air-conditioning machinery, is dumped into the local atmosphere and you will see why heat islands exist in and around major dwelling area. In the attached link the temperatures in Atlanta vary from around 18C to around 28C depending on how dense the population is.
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Urban Heat Island: Atlanta, Georgia - NASA Science
Urbanization does more than just transform ecosystems, it also changes fundamental variables that influence weather and climate, such as land surfacescience.nasa.gov
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The reason why cities radiate so much more heat than the surroundings is the stone and concrete. More green would absorb energy by evaporating water. No such luck in cities with the roads, buildings and less and less green gardens.
Heat is always produced, but the isolating layer of CO2 disrupts the balance.