Growing Smart

Why is the smart city movement impor­tant to you?

The world is urbanizing. Over 50% of the world’s population is currently living in cities, and we’re heading to 70% or 80% in the future. This is creating a lot of challenges for cities around the globe. We’re also seeing cities having an increasing impact on the environment, ecological systems, and climate change. Cities are the source of many of the challenges society is facing today, but they’re also a likely source of innovation and opportunity to change how we live in a way that’s more sustainable for the future.

Is a smart city necessarily a green city?

In my opinion, yes. Some people want to define smart cities as cities that are using technology to become more efficient, but I believe in a more holistic vision. To me, a city is not a smart city if it is not also on a green path and trying to be more sustainable – and that’s through technology and non-technology. Everything from more progressive green building strategies to developing renewable energy to using energy monitoring systems – all of those things fit very clearly within the scope of a ‘smart city.’

How can cities profit from a transition to a low-carbon economy?

I actually wrote a book in 2011 called Climate Capitalism, which looked at how companies, cities, and governments are already profiting from a low-carbon economy. We looked at several different sectors of the economy – energy, buildings, transportation, agriculture, and carbon markets – to explore this specific question. But I think it is the least sexy solution that makes the most sense, and that is investment in energy efficiency – whether in lighting or in building efficiency. The return on investment is usually quite quick for cities, so that’s an easy example of a way cities can profit from a low-carbon economy.

I think there are a lot of other areas that may be more interesting. One example is how cities can work to promote clusters of green technology and development in the city. They can use the city as an urban laboratory to test new solutions, and have local technology companies gain access to global city markets by proving the case for their technology in their local city. I like that idea because it obviously can improve the sustainability performance of the city they’re in, and they can also pay tribute to local economic development.

There’s an interesting project in Amsterdam right now that I’m following called AMS Institute. They have four Dutch universities partnering with the city of Amsterdam and several multinational companies, and their plan is to co-create solutions around energy, building, water, and food systems. They are testing them in Amsterdam, and will export the best solutions around the world.

Why do so few cities in the world try to adopt smart technologies?

It’s the same thing in the private sector. The private sector has also been very slow to embrace a lot of these things, and it is sometimes confounding or surprising that they’re not more proactive in embracing things like energy efficiency when the business case is so clear. I think part of it is that it’s just not where their attention is. I’ve discussed some of these topics with private sector companies – they’ve basically just got different priorities. Even if there is a good return on investment – for example, implementing energy building retrofits – there’s more offside potential in investing that money in R&D for creating a new product or service that might generate more revenue and profit.

In the public sector, I think there are a lot of challenges. One is a lack of knowledge from the public officials. Another problem is the lack of financing instruments. Even if it makes financial sense, they don’t always have the ability to make investments in these projects. And that’s where I think some innovative public-private partnership models emerge, where the private sector maybe takes more of the risk and puts a lot of the upfront investment in the project, but then it gets more of the long-term returns on investment instead of the city itself.

An example is the ESCO model, the energy service company model, which a lot of cities have adopted. A private sector energy company comes in and assesses buildings in the city – municipal buildings, for example – and comes out with a program for enhancing energy efficiency. The private company essentially finances the retrofitting of the buildings, but in return, they get a percentage of the savings from the energy cost over a long period of time. That allows the private company to get a good return on investment, but still saves the city money.

There are a lot of examples like that that are emerging in the smart city space where you can try to find a win-win between the private and public sector, and the public sector might get away with not even having to pay any upfront investment.

What smart city technology do you personally consider to be the most important/interesting/promising today?

I’m very interested in everything around mobility. For example, applications using real-time data to facilitate smarter decisions from citizens about the right way to move around the city. I’m very interested in the electrification of the local transit infrastructure – by electrifying public transit as well as supporting the adoption of electric vehicles and car-sharing and bike-sharing programs. I’m very interested in the whole range of mobility solutions that are emerging or have been implemented.

But across the board, you probably have seen my ‘smart cities wheel.’ I have six components to that wheel, and that’s basically how I define a smart city. In each of those areas, there is emerging technology and non-tech. I think that’s an important factor, too. To me, a smart city isn’t just about using more technology, but it’s also just about being smarter and more innovative about its business - whether that’s better participation of citizens in co-creating solutions or whether it’s the emergence of procurement for innovation. That is where cities change their procurement process to make it less bureaucratic and focus more on securing innovative solutions to their challenges rather than using basic off-the-shelf solutions.

What do you think of Moscow, or Beijing, or Delhi – do they have the potential to become smart cities? Do you even consider them when rating cities?

I do rankings of regions – Europe, North America, Latin America, and Asia-Pacific – so I basically chose 30 cities in each of those regions. Some of those cities, like Beijing, were eligible in this year’s ranking. There are buckets of innovations that you’d expect to have in a smart city that are happening in all those cities, but there are many challenges as well. Beijing is a good example – with such a large population, air contamination, and other challenges, it’s not easy for them to achieve some of the things I find in Vienna or Barcelona or Boston.

To me, the smart city thing is a journey to be a smarter, more efficient city. I think every city is either on that journey or they should be. I don’t actually believe that any city is really ‘smart’ – I think they all are just trying to be smarter. Beijing, Moscow, and every other city in the world has just as much opportunity to improve where they are now, be smarter about how they use their resources, how they engage with citizens, how they interact with the natural environment, and what they do to promote innovation in the private sector and support new enterprise. All the cities you mentioned are doing these things, but they can always do more.

As for Moscow, I haven’t looked at it in detail, but of course I’ve studied the Skolkovo project. I think it’s a fascinating example of new, greenfield smart city development. The case of Skolkovo is an example of what you’re doing when you’re near massive capital cities or very large cities, and what you might want to do when you can start with a clean slate and think about the role of the university, think about the role of innovation and technology, and think about infrastructure from the beginning, without having to retrofit things. I think there’s something to look at, particularly in that example, that’s being replicated or adopted or explored in other countries around the world. And that’s something I’m certainly following and interested in.

What should a traditional city begin with to become a smart city?

That’s a good question. My opinion is, the first thing is to do some sort of baseline diagnostic of where they are. The rankings I do are designed to provide that benefit. I publish the indicators that I use, so cities that are not even ranked can use them. I think doing measurements to understand where they are across all aspects of a smart city is really important before they try to start making decisions. One of the next steps is co-developing strategies for the future involving citizen groups and other stakeholders in the process of thinking about what the future of the city could or should be.

Eventually, that should include indicators. This year, I’m using 62 indicators. Let’s say Moscow used 62 indicators, and they have a baseline of where they are in 2014. They should look at 2040 or 2050 and say, ‘‘Okay, only 1% percent of daily trips are done by bicycle. By 2050, we’d like that to get to 15% or 20%.’’ And you have that for all of the indicators. Again, that should be co-developed with some citizen involvement. Then you can start prioritizing projects based on where you’re weak and where your priorities are.

Why do you think the future of capitalism lies in green innovations? Why is it good for the economy, apart from saving the planet?

Again, my book looks at that in a lot of detail. The future of industry has to be greener than it is today; there’s really no alternative. As the population of the world continues to grow over the next couple of decades, the overexploitation of natural resources and the declining supply of fossil fuels will require rethinking our development and industry in a way that is more sustainable. In my opinion, the future of all industries is going to have to be more sustainable than it is today, and so is the future of our cities. That is going to have to come from either citizens, or stakeholders, or city requirements, or because there’s not much of an alternative. As we start running out of fossil fuels, we’re going to have to look for alternatives.

I think the companies and countries and regions in the world that recognize that, and begin to invest in more sustainable innovation and technology, are going to be in the best position for long-term economic success.

Could you give some examples of a quick/efficient transition from a traditional city to a smart city?

I’ve written recently about two of my favorite cities. When you look at a fast transformation, I think that’s Medellín in Colombia and Singapore in Asia. You can find an article I wrote in UBM’s Future Cities where I describe the transformations of those two cities in a lot of detail. Both of them were basically like third-world countries about 30 years ago (Medellín is not a country, but it was like it was in a third-world country), and they transformed over the last few decades. Medellín, for example, was named the most innovative city in the world last year. There are really interesting things happening in some of these cities, and not always the capital cities – Medellín is a good example. Sometimes innovations come from smaller, secondary cities.

It is the least sexy solution that makes the most sense, and that is investment in energy efficiency – whether in lighting or in building efficiency. The return on investment is usually quite quick for cities, so that’s an easy example of a way cities can profit from a low-carbon economy.
There are a lot of other areas that may be more interesting. One example is how cities can work to promote clusters of green technology and development in the city. They can use the city as an urban laboratory to test new solutions, and have local technology companies gain access to global city markets by proving the case for their technology in their local city

What is an ideal city to you?

Wow, that’s a good question. It’s dense. We haven’t talked about this yet, but urban planning around the world is not very good, and you find that cities continue to sprawl, and that’s far from ideal.

An ideal city is dense, it’s walkable. The best forms of transportation are walking and biking. So it’s a city you don’t even really need to use public transportation in. I guess it’s a city where cars are basically non-existent or not used very often, and the ones that are used are electric. I think it’s a city that’s inclusive – that doesn’t have major problems with inequality and doesn’t have a lot of really poor neighborhood slums. Everybody – wealthy or non-wealthy – has access to the high-quality basic services that people deserve and need, like healthcare, quality education, and access to jobs and food. It has a strong local food system, so it doesn’t depend on importing food from thousands of miles away. It’s a low-carbon city. For me, it’s a city that has a lot of green space and incorporates nature. My dream cities are the ones that have mountains and water nearby, cities that you can enjoy, exercise in, and take your family out for activities in. It has a vibrant culture with a lot of museums and galleries, and cultural activities in the streets. The street thing is big for me. I think cities that have a really vibrant street culture are the ones that feel most alive – cities that are very pedestrian-friendly, where the streets are fun to walk down, and where interesting things are always going on somewhere.

What do you mean by ‘dense’ – does it have to be highly populated?

It doesn’t necessarily have to be highly populated, but the population is in a denser, more compact area of the city. The city isn’t sprawling over hundreds of miles, but instead covers a much smaller territory. People live in denser neighborhoods and buildings, not just single family homes with gated communities.

How do you picture an ideal city in 20 years?

Cities don’t transform that fast normally, so I don’t think you’ll see radical change. But you’re clearly going to see the presence of technology becoming more important. Some of the technology will be obvious and in your face, like real-time billboards and things that you can see. On the side of a road or in a plaza, you might have digital signs that provide information in real time about traffic, where the nearest bathrooms are, where the nearest street performance is happening, and so on. Other technology will be working behind the scenes – sensors, video cameras, things that work to improve security, mobility, and traffic flow, things that monitor energy in real time, and all the mobile applications people use to be ‘smarter.’ I think we’re going to see much more sharing in the economy – where people use technology to share resources rather than buy new things. Some things we see will be different, I think.