Looking for recommended reading/best practices for efficiently simulating large numbers of NPCs

I'm working on a sandbox-ish game that relies centrally on the area the PC lives in feeling like a living, breathing city. My original plan was to run it like Dwarf Fortress and have every NPC remain permanently awake and working, but this feels like a really wasteful way to do things, as 95% of the things I'm spending CPU and memory on simulating aren't in a position to be witnessed and appreciated by the player.

Because of this I'm shifting tacts and looking at ways I can only actively...

Looking for recommended reading/best practices for efficiently simulating large numbers of NPCs