Smart Cities.: - An Analysis, Approach, Financing, Benefits and Challenges

An Analysis, Approach, Financing, Benefits and Challenges of the Smart Cities. ********************************************************************************* .Introduction :- ********************************************************************************* As cities grow, managing them becomes more complex and their populations become more diverse.‘Smart Cities’ aim to decrease the challenges that cities face, such as scarcity of energy resources, healthcare, housing, water, and deteriorating infrastructure (roads, schools and transportation).They also suffer from price instability, climate change, and the demand for better economic opportunities and social benefits (Washburn et al. 2010). Recent advancements in Information and Communication Technologies (ICT), aligned with technology cost reduction, such as cheap mobile apps, free social media, cloud computing, and cost-effective ways to handle high volume data, provides cities with better opportunities and tools to understand, communicate, and predict urban functions (Susanne Dirks and Mary Keeling 2009; Berst et al. 2013). According to the United Nations population division (UN 2004), world population was around 1.65 billion at the end of the 19th century and it crossed the 6 billion mark by the end of the 20th century. Cities are also the major centres of consumption of resources (UN 2011). Currently, urban areas roughly occupy 3 percent of the planet's surface and, consume 75 percent of the global primary energy; they emit between 50 and 60 percent of the world's total greenhouse gases (Editors 2014; UN 2015). Bletchley Park often considered to be the first smart community. Examples of Instrumentation intelligence have been implemented in Amsterdam ******************************************************************************* Statistics about the smart cities:- ******************************************************************************** According to figures published by the New Jersey Institute of Technology (NJIT), smart city technologies will grow to an industry worth $27.5 billion by 2023.The world will be have 88 smart cities by 2025 Currently, the world has 841 million seniors. 82.3% of Americans today live in urban centers. By 2050, around 70% of the people will be living in cities and India is no exception. In Spain, the city of Santander has cut energy and waste management costs by 25% and 20% respectively aided by 12,500 IEEE, GPRS, and RFID sensors installed throughout the city. Major cities that install smart transport systems will realize savings of about $800 billion annually from 2030. smart technologies will make it easier for emergency responders, firefighters, law enforcement officers, and traffic control workers to offer better services. global market for smart urban services will be $400 billion per annum by 2020. Examples of Smart City technologies and programs have been implemented in Milton Keynes Southampton, Amsterdam, Barcelona, Madrid and Stockholm. An important cluster of Smart City technological companies exists in Israel with Tel Aviv being awarded the World Smart City Award in 2014. Israeli companies are implementing Smart City solutions worldwide. In China, ZTE Corporation have more than 150 cities with Smart Solutions. In Singapore 90% homes have broadband, 85% smart phones penetration rate and fiber technology will reach every household very soon. The upcoming smart city at Dholera Special Investment Region (SIR) in Gujarat will become operational by 2019. Lavasa, near Pune promoted by Hindustan Construction Company, was India’s ‘first planned hill city’. Chandigarh is also considered as a first good planned city of India. Amaravati (Capital Andhra Pradesh ) is also a new recently planned city in India. ******************************************************************************* Reasons for creating smart cities: ************************************************************************ 1. Population is aging: Worlds population is aging so lot of aged people will live in city will require convinient facilities which are auomated and smart. 2. Wastage of Resources :- Resources like Water ex. up to 50% of the world’s population (four billion) will reside in water stressed areas by 2025 3. High Energy Requirements:- A growing global population will increase energy demand by 56% by 2040. 4. Usage of Renewable energy: like solar energy Urban centers can also benefit greatly by installing and using energy-efficient IoT (Internet of Things) systems. The US alone would realize savings worth $1.2 trillion if it could deploy big data analysis for this purpose. 5. Gathering Data:- Traffic management traffic jams, technology would come in handy to improve efficiency. This would require GPS systems, cameras, and traffic light coordination systems connected via IoT to keep traffic moving 6. Water saving:- The City of Dubuque, IA has helped households realize water consumption savings of about 7% ******************************************************************************* Approach towards smart city:- ************************************************************************ The Smart Cities mission focus is on sustainable and inclusive development. The mission approach is unique in concept with established methodologies for various levels such as visioning, planning, implementation, and evaluation; and integrative model of smart city framework. The following are the five key sub-systems of this framework: i. Convergence approach for Comprehensive Development (Visioning) ii. Compact area approach for city development (Planning) iii. Strategic Planning approach for Smart City Proposals (Implementation) iv. 'Smart Citizenry' approach for participatory planning (Implementation) v. Incremental approach in selection of cities (Evaluation) ******************************************************************************* Hexagonal model of Smart Cities *************************************************************************** Based on the taxonomy analysis of the strategic priority areas, mission statement, literature in guidelines document, a hexagonal model of Smart Cities dimensions is derived with the following as the components: 1. Infrastructure 2. Governance 3. Inclusive 4. Sustainable 5. Citizen Centric 6. Safety ******************************************************************************* The Four layers of smartness of Cities are: *********************************************************************************** 1) 'Core' Infrastructure layer:- In this Basic Infrastructure of the City will be improved. 2) 'Sustainable' Environment layer:- Energy demand of the city will be met by the renewable energy without pollutions so that cities will be eco-friendly and last longer. 3) 'Area based' Development layer:- Best and favourable areas will be identified for the development of parks, malls, educational institutes, hospital, Business hubs, recreational places etc. 4). 'Smart' Technology layer:- Use of lot of sensors will collect lot of data to take right and prompt decisions ******************************************************************************* Typical smart city benefits: ***************************************************************************** 1. Faster reaction to public safety threats by real-time analysis of sensor and surveillance camera video data 2. Smoothened distribution of tourists (geographical and over time) by analysis of tourist movements and real-time incentives 3. Exchange of products and services in a peer-to-peer model (sharing economy, from possession to use) 4. Dynamic groups of citizens organize themselves to work together on collective interests 5. Co-creation of decision making, new forms of digital democracy and participatory government 6. Data-driven policy making leads to more focused interventions and measured evidence of effectiveness 7. Better diagnostics and personalized treatment through artificial intelligence on massive volumes of patient data 8. People who need care can live in their own home longer through advanced sensoring and health care robotics 9. Lower congestion and pollution through optimal use of transportation infrastructure (roads, parking places) 10. Energy savings through real-time insight in energy usage, combined with gamification concepts ******************************************************************************* New Technologies and Innovations used in the SMART CITY project ********************************************************************************** Many stakeholders, working together in partnerships of different shape and form ******************************************************************************* Digital revolution **************************************************************************** 1. Accelerometer:- To sense movement of the device 2. Ambient light to sense the brightness of the light surrounding the device 3. Barometer:- to sense pressure 4. Camera:- to visualize the environment of the device 5. GPS:- to track the geographical location of the device 6. Gyroscope:- to sense the orientation of the device 7. Magnetometer:- to sense the magnetic field to operate the device’s compass 8. Microphone to sense sound reaching the device 9. Proximity sensor to sense when someone is close to the device 10. Temperature to sense the temperature around the device ******************************************************************************* Internet of things (IOT) –A multitude of sensor types Typical examples of sensor use:- ******************************************************************************** 1. Air– Sensors that detect the level of air pollution in urban areas to take appropriate me assures that protect peoples health. 2. Buildings– Sensors that monitor vibrations and material conditions in buildings , bridges and historical monuments provide‘ early warnings ’ incase of damages. 3. Distribution vehicles– Sensors that detect the geographical location of each vehicle in a fleet are used to optimize route sand create accurate estimates for delivery times. 4. Energy usage– Sensors that monitor energy usage can be used to verify the energy efficiency of “green building” and gain insight in further improving this efficiency. 5. Green houses– Sensors that detect the micro-climate in terms of temperature, humidity and CO2 level are used to maximize the production of fruits and vegetables. 6. Gunshots– Sensors that detect the sound of a gunshot are used to pin point the location with an accuracy of 10 meters in real time and dispatch police to that location immediately. 7. Hazardous gases– Sensors that detect levels of explosive or toxic gases in industrial environments and indoor locations allow immediate action to secure the safety of people. 8. Health– Sensors that measure vital metrics such as blood pressure and heart-rate, are used to monitor patients as they live their lives. The data is used to decide when the next visit to the doctor is necessary and to improve patient adherence to prescribed therapies. 9. Item location– Sensors that detect the geographical location of an object are used to track objects to save valuable time searching for them. 10. Machines– Sensors that monitor the state of machine parts ,e.g. by measuring temperature, pressure, vibration and wear generate detailed data that can be used for condition based maintenance ; applying maintenance when it is needed instead of in regular intervals independently from the status of the machine. 11. Noise– Sensors that monitor noise levels generated by entertainment venue sin real-time allow rapid interventions when permissions are violated. 12. Parking spaces :- Sensors that detect variations in magnetic fields generated by parked cars are used to detect whether a parking space is free. The information is used to guide people looking for a cars pace to the nearest free space. 13. Perimeter access– Sensors that detect people in non-authorized are as are more efficient than human security guards and can trigger immediate action on the right location. 14. Public lighting– Sensors that detect motion of people and vehicles in as treet and adjust the public lighting to the required level. 15. Rivers– Sensors that detect river pollution e.g. caused by leakages of chemical plants in real-time allow for immediate actions that confine the damage to the environment. 16. Roads– Sensors that detect the temperature of a road to provide early warnings to drivers in case of slippery road due to e.g. ice. 17. Storage conditions–Sensors that monitors to rage conditions of perishable goods such as vaccines and medicines measure temperature and humidity to secure the quality of products. 18. Storage incompatibility–Sensors that detect objects (e.g. dangerous goods) that are not allowed to be stored together .e.g. inflammable goods and explosives. Or in hospitals, the presence of blood for patient X in the operating room where patient Y is having surgery. 19. Traffic– Sensors that detect the speed and the number of vehicles using public roads are used to detect traffic congestion and suggest drivers to take an alternative route. 20. Waste– Sensors that detect to what extent arubbish containers filled, to optimize the trash collection routes and to prevent trash being deposited on the street of a container is full. 21. Water– Sensors that detect water leak ages in the water distribution network are used to align the maintenance schedule to the actual loss of water. ******************************************************************************* Few examples of Smart City:- Songdo:- ******************************************************************************* International business center. City built from the scratch with the help of technology from CISCO. while preparing this city they took good design from various other cities like new-york, Savana, Venice, Sydney etc. they have taken best from other cities. Songdo IBD was designed and created to be a "ubiquitous city", or a smart city. What is "ubiquitous" is the technology, i.e. computers are built into the buildings and streets. For example, Songdo IBD residents can video-conference with their neighbors, or even attend classes remotely. They can control lighting, heating, air conditioning and more, all with the push of a button on a control panel. Sensors gather information on things like traffic flow and energy use. This kind of information can be converted into alerts that tell citizens when a bus will arrive, or notify the authorities when a crime is taking place. The water pipes are designed to prevent drinkable water from being wasted in showers and toilets *********************************************************************************** Masdar City:- *********************************************************************************** The plan was to make Masdar the world's first zero-carbon city. Foster's vision was for Masdar's streets to be pedestrian-only with pilotless vehicles running via magnets and fibre-optic cables. Masdar City will be the latest of a small number of highly planned, specialized, research and technology-intensive municipalities that incorporate a living environment. the city relies on solar energy and other renewable energy sources. Masdar City hosts the headquarters of the International Renewable Energy Agency (IRENA). The city is designed to be a hub for cleantech companies. Its first tenant was the Masdar Institute of Science and Technology. The 45-metre Teflon-coated wind tower shows citizens how much energy the community is using; argon gas insulates the rammed earth and steel walls; solar air-conditioning and desalination plants are being tested, as are thermal energy and "beam down" solar plants that use mirrors to concentrate the sun and heat water to generate electricity. ************************************************************************************* Rio- di genero:- ************************************************************************************* Services are carried out via the IBM Intelligent Operations Center. Think of it as a mission control for cities, white lab coats included. They are able to leverage real-time city information, anticipate problems, and coordinate available resources. The system was originally integrated in Rio as a way to improve the city’s emergency response system following the 2010 floods. By using a forecasting system that synthesizes data from the river basin, topography surveys, historical rainfall logs, and radar feeds, the operations center is able to anticipate heavy rains, flash floods, landslides, power outages, and traffic hazards. IBM kicked things up a notch by fully integrating 30 city agencies into a single operations center, constantly tracking the pulse of city operations. By breaking down inter-organizational silos, they speed response and recovery time. Residents can simply download an app to their smart phone or track city alerts via Facebook and Twitter. Car accident or traffic jam? Simply pull up the app and it will calculate the most efficient route based on current and predicted traffic patterns. Financing of the Smart Cities:- Inadequate funding is a serious challenge facing local governments in developing countries for financing the smart cities and to smarten up urban infrastructure, operation and maintenance mechanism, and urban basic services delivery. These projects are capital intensive and expensive because of their nature, size, technologies and materials they use, and area they cover. They are built to last for a long time and hence require capital improvements on a periodical basis. To most municipal governments, raising adequate revenues from own sources is a mammoth task and this requires strategic urban planning with efficient and effective legal, regulatory frameworks. Mobilization of adequate revenue by local governments from own sources is key to maneuvering this locally driven development process. The challenge in recent years has been attracting more private investment into the finance market for smart infrastructure projects. Leveraging private sector funds, which are potentially larger pools of finance capital, can be useful for financing projects that will improve livability and have long-term impacts on a city’s economy. ************************************************************************* Categories of investments:- ************************************************************************* Financing Models Implementing Smart City solutions is financially challenging. Urban services models can streamline this transition by defining the city’s baseline capital projects, schedule during land use master planning, and ICT needs upfront. In essence, Urban Services models allow the private sector to build a roadmap for the public sector’s Smart City vision with realistic deliverables that are grounded with tangible service level agreements and metrics over a multi-year operations contract. The right financial environment is necessary to ensure sound risk return profiles and sustainable business models (Guha et al. 2015). The following is an indicative list of some of the innovative financing models for Smart Cities in India by Guha et al. (2015): i. Municipal bonds / Sector Specific bonds ii. Pooled finance development fund iii. Public Private Partnership (PPP) models and performance contracts iv. Land use financing v. Securitization through structured finance ***************************************************************************************** Opportunities for financing Smart Cities in India ****************************************************************************************** Since the Government of India's proposal to develop 100 Smart Cities in May 2014 till May 2015, prioritization of existing cities and proposals for new cities. The proponents include State government, city government, industry, multilateral donor agencies, research communities and academia. This included proposals for transformation of existing into Smart Cities and Greenfield Smart Cities across India. The partnerships between city/state governments and national & global agencies marked the beginning of this ambitious and necessary step. A cognitive mapping exercise was done as part of this research study to understand the dynamics of the Smart Cities development in India and present the status quo and funding opportunities available for cities. The analysis shows the other side of the Smart Cities market in India. The total anticipated outlay of budget proposed by various agencies (national and global) to build Smart Cities in India, to support the existing innovative initiatives of cities for transforming themselves into Smart cities is INR 3,59,555 lakh crore, a major 77 percent of the total plan expenditure of the Union Government of India. The following are some of the countries the donor agencies represent or are currently located in: United States, Switzerland, Singapore, California, Germany, Dubai, Spain, China, Hong Kong, Japan, Korea, Qatar Sweden and Netherlands. Cities can and should take leverage of the external funding sources while preparing the Smart City proposals. Securing funding sources and establishing financial mechanisms prior to the selection of the Smart City and non-participation of state-owned infrastructure financing companies are some of the challenges in the roll out and implementation of Smart Cities (Roy choudhury 2015). ********************************************************************************************** Challenges for developing Smart Cities:- ********************************************************************************************** 1. The challenges of climate change, population growth, demographic change, urbanisation and resource depletion is a common challenge for cities across the world. (Buscher et al. 2010). 2. Business models for rolling out smart technologies are still underdeveloped. Even if money was available for investment, most of the smart technologies are still in their pre-commercial stage of development and the risk-sharing mechanisms and business models needed to take them forward are yet to be tested and developed. 3. The lack of business models also restricts the availability of private sector financing (Hirst et al. 2012). 4. Successful implementation of smart city solutions need effective horizontal and vertical coordination between various institutions involving institutions providing various municipal amenities as well as effective coordination between central government (MoUD), state government as well as local government agencies on various issues related to financing, sharing of best practices and sharing of service delivery processes (Guha et al. 2015). 5. Cities find it difficult to work across departments and boundaries. Many of the smart cities initiatives include integrating different policies and information systems such as linking cycling with carbon reduction or integrating data relating to unemployed individuals from different departments onto a single platform. 6. Smart cities have largely failed to acknowledge the challenge presented by the “digital divide”; that is, the social and economic inequalities which come about as a result of who has access to communication technology, and how they use it. The “digital divide” is also a gendered divide. 7. The High Power Expert Committee (HPEC) on Investment Estimates in Urban Infrastructure has assessed a per-capita investment cost (PCIC) of Rs 43,386 for a 20-year period. Using an average figure of 1 million people in each of the 100 smart cities, the total estimate of investment requirements for the smart city comes to Rs 7 lakh crore over 20 years (with an annual escalation of 10 per cent from 2009-20 to 2014-15). This translates into an annual requirement of Rs 35,000 crore. One needs to see how these projects will be financed as the majority of project need would move through complete private investment or through PPPs (public-private partnership). 8. Availability of master plan or city development plan: Most of our cities don’t have master plans or a city development plan 9. Providing clearances in a timely manner: For timely completion of the project, all clearances should use online processes and be cleared in a time-bound manner. 10. Capacity building programme: Building capacity for 100 smart cities is not an easy task and most ambitious projects are delayed owing to lack of quality manpower, both at the centre and state levels 11. Reliability of utility services: For any smart city in the world, the focus is on reliability of utility services, whether it is electricity, water, telephone or broadband services. Smart cities should have universal access to electricity 24×7; this is not possible with the existing supply and distribution system ******************************************************************** Conclusions of the research study:- ******************************************************************** Now, Half of the global population live in the cities. Cities are also the major centres of consumption of resources. we must encourage people to use less energy. Currently, urban areas consume 75 percent of the global primary energy. cities emit between 50 and 60 percent of the world's total greenhouse gases. The world will be have 88 smart cities by 2025. smart city technologies will grow to an industry worth $27.5 billion by 2023. Recent advancements in Information and Communication Technologies (ICT), aligned with technology cost reduction, such as cheap mobile apps, free social media, cloud computing, and cost-effective ways to handle high volume data, provides cities with better opportunities and tools to understand, communicate, and predict urban functions. In Spain, the city of Santander has cut energy and waste management costs by 25% and 20% respectively aided by 12,500 IEEE, GPRS, and RFID sensors installed throughout the city. Cities that install smart transport systems will realize savings of about $800 billion annually from 2030. smart technologies will make it easier for emergency responders, firefighters, law enforcement officers, and traffic control workers to offer better services. sensors used in smart cities will help in faster reaction to public safety threats, Smoothened distribution and logistics, easy exchange of products and services, prompt decision making, digital democracy, better diagnostics and personalized treatment, Lower congestion and pollution, Energy savings, Responsive household appliances, efficient waste collection, water distribution network etc. challenges in implementing smart cities are projects are capital intensive and expensive because of their nature, size, technologies and materials they use, and area they cover. Smart cities are also facing some challenges like Business models for rolling out smart technologies are still underdeveloped, lack of business models also restricts the availability of private sector financing, Successful implementation of smart city solutions need effective horizontal and vertical coordination between various institutions and non availability of good master plan or city development plan. Smart city project is facing many challenges as this technology is comparatively new and since lot of amount of financing is required, so it is very risky project. Smart cities are also solution to problems like aging Population, Wastage of Resources, High Energy Requirements, Usage of Renewable energy, Gathering and analysing Data, Water wastage, Pollution, public transportation etc ************************************************************************* References:- ************************************************************************* 1. TEDx (Producer). (Dec 17,2015). How we design and build a smart city and nation | Cheong Koon Hean | TEDxSingapore [Motion Picture]. Singapore: you tube. 2. (November 2015). Smart Cities – A Deloitte Point of View, Version 1.0. deloitte, Partner Deloitte Public Sector GovLab. Netherlands: deloitte. 3. Big Data and the IoT: The Future of the Smart City. (n.d.). Retrieved February 22, 2017, from New Jersey Institute of Technology (NJIT): http://graduatedegrees.online.njit.edu/resources/mscs/mscs-infographics/big-data-and-the-iot-the-future-of-the-smart-city 4. TEDx (Producer). (May 21, 2013). Smart Cities: How do we Build the Cities of Tomorrow: Hugh Green at TEDxEmory [Motion Picture]. https://www.youtube.com/watch?v=YGOVEvm7dm0&t=20s 5. https://www.google.co.in/?gfe_rd=cr&ei=Cfu2WMu8Je3y8AfQ1LCACA#q=smart+city+pdf&* 6. http://smartcities.gov.in/content/ 7. https://en.wikipedia.org/wiki/Smart_city