Utilities May Lead Smart Cities
Smart City initiatives are popping up around the globe. Innovative technologies and services support a plethora of "smart" - smart energy, smart building, smart water, smart homes, smart transportation, smart infrastructure, smart governance, smart education and smart consumer. The list may seem to encompass all things, and that would be the point. A smart city imitative crosses many facets of services in order to derive the most value. According to some industry analysts, the global smart city technology market is projected to be valued at more than $1.5 trillion in the next five years.
Although some utilities in mature markets face challenges from renewable mandates, federal regulations and integration of new technologies, the evolution of the smart city market has grown with almost limitless innovation. There is a great appetite for partnerships and collaboration as utilities and technology vendors realize that no single entity can solve this global problem alone.
So who or what is driving smart city initiatives? In some cases, municipal leaders are motivated to have their cities recognized as smart cities. In others, technology vendors want to drive the conversation. Meanwhile, an unlikely leader is emerging in the smart city dialogue - the utility company.
Why would a water, gas or electric utility want to add programs and technology that would help consumers use less of its product? Would this not cut into earnings? Forward-thinking utility leaders say the answer is to not necessarily use less, but to use the right amount, at the right time, in the most efficient ways. Digital transformations, asset management, distributed renewable generation, microgrids and smarter communicating devices provide utilities around the world with opportunities for greater innovation. To address the push toward smart city status, utility executives are also addressing new business models, looking for greater operational efficiencies and striving for better consumer engagement - all while attracting inventive workforce.
Utility companies already have led successful smart city initiatives. For example, in California, community benefits resulted from the efforts of the Sacramento Municipal Utility District to automate billing processes, to dramatically shrink the service connect/ disconnect cycle time and to provide customer choice in energy programs. In Olathe, Kansas, the Olathe Public Works Department's smart water initiatives provide smarter infrastructure and greater water and wastewater efficiencies to attract and retain new businesses. In Charlotte, North Carolina, Duke Energy's Smart Energy Now program helps to reduce energy consumption in office buildings by focusing on individual consumer behavior.
Ultimately, smart city initiatives will profit many, including utilities, individuals and governments, while protecting natural resources and sustaining future generations, but many more people and companies need to be part of the conversation.
Also Published In: EnergyBiz Magazine Winter 2015