The Spain striker, who has scored 18 goals in his first season with the Blues but been booked 10 times, will miss the next three games after the Football Association found him guilty of violent conduct.
The charge relates to an incident in the Capital One Cup semi-final second leg against Liverpool on Wednesday night in which Costa appeared to stamp on visiting defender Emre Can.
The first game of Costa’s suspension will be Chelsea’s first-versus-second clash with City at Stamford Bridge on Sunday, and Pellegrini feels the striker can still be effective without that side of his game.
“I think he’s a great player, a very important player,” said the City manager. “He is not an easy character but I hope for him that after the punishment it would be good for him to change a little bit in the future.
“He doesn’t need to do it that way because he is a very good player, he is top quality.”
While Costa will be missing for Chelsea, City will also be without one of their key players as midfielder Yaya Toure remains on Africa Cup of Nations duty with the Ivory Coast.
Toure’s national side have reached the quarter-finals of this year’s championship, in which they will play Algeria on Sunday.
Pellegrini played down the importance of the 31-year-old, who is a vital player for City, and highlighted the team’s strong performances when he has been unavailable on other occasions.
“It’s an opportunity for other players to show what they can do,” he said. “Yaya is a very important player for us.
“We played without Yaya and we qualified against Bayern Munich and against Roma in the Champions League so he is a very important player and it is exactly the same with Diego Costa but I don’t think that both teams depend just on those players.
“We have Fernandinho who plays in a different way to Yaya but we have won in the past without him.”
Chelsea go into the match with a five-point lead over defending champions City but, with four months of the campaign remaining, Pellegrini claims it is not a must-win clash.
He said: “I think it is a very important game. It is not the game that will decide the title because after that we have to play for 45 points more.
“If you remember some years ago this club won the title after being eight points behind Manchester United, so in football you never know.
“But it is a very important game and it is important for us to try and close that gap as soon as we can.”