Hopefully you managed to listen to the VERGE Cities 2.0 webcast on Wednesday 18th July. It was a great event, discovering why we are all talking so much about the future city. (You can still listen to the archived event anytime).
The Schneider Electric round table focused on how cities can leverage technology investments, and began with Eric Woods, Smart Cities Research Director, Pike Research, giving a brief presentation on smart city dynamics. The rate of movement of people into cities is pretty astounding, with an estimated 1 million people migrating into cities each week for the next 40 years. To manage this growth, Pike estimates that $100 Bn will be spent on smart city projects over the next 10 years. Eric also said that he saw four main themes for the City 2.0: financial models and scalable development; open data and new business models; multi-modal transport and rethinking the way the city moves; and creating the resilient city.
Joel Makower, chairman and executive editor of GreenBiz then introduced Adel Ebeid, Chief Innovation Officer for the City of Philadelphia. Adel spoke about the role of his office and his ambition of setting an innovation framework that is sustainable beyond a single administration. He has been instrumental in driving open data and transparency in Philly and through opendataphilly.org has created a platform where any organization can post data sets that can be viewed by all.
Jim Anderson, Vice President of Smart Cities North America at Schneider Electric, was asked about our involvement in smart cities, which he described as building on our domain expertise to deliver more efficient, liveable and sustainable urban environments.
Jim was asked about funding models for city investments and spoke about our performance contracting model where building upgrades/retrofits can be funded from the money saved from energy bills after implementing energy conservation measures. This gives cities the means to improve their buildings’ infrastructure without negatively impacting the tax payer. And because the savings are guaranteed, cities can engage without risk.
In terms of identifying the key opportunity areas in a city, Jim stated that buildings were the low-hanging fruit, followed by water infrastructure and transportation. In terms of measuring the return on investment for smart city projects, both the direct and indirect benefits of a project need to be considered. For example, when looking at a project that reduces road congestion, the direct benefits would include shorter commutes, fewer delays etc., but there are additional benefits such as reduced CO2 emissions from cars and fewer accidents. We need to look at projects from an environmental and social benefit perspective, as well as economic.
Helen Honisett, Director Energy EcoSystems at Cisco talked about the company’s involvement with smart cities, in particular that the move towards the City of the Future is not one that a city can do alone – it must be built on partnerships with industry, thought leaders (such as universities), and learning from many other municipalities. Cisco has been working with the City of Barcelona and MIT to look at building out a city protocol, which aims to become a standard reference model for sustainable urban development.
She also spoke about how determining the ROI from city spending has always been complex, as the spend is centralized but the benefits are felt by the citizen on the street – which means they are highly decentralized. This means that any “risky” investment or a break from the norm requires a new way of aligning resources and funding. The breaking down of silos and in some circumstances, regulation, takes a lot of drive and visionary leadership.
Cisco believes it has a role to play working with cities to identify new funding models and partner programs, as well as working with them to understand the level of maturity a city has around IT and its use within the city.
The dream of the smart city is for some exactly that – what we need is a systematic approach to moving towards this dream – one step at a time.
Learn more about Schneider Electric’s vision for smart cities, and join the conversation on twitter. Search for #VergeCon and let us know your thoughts.