Utilities are fundamental to smart city initiatives, so if cities want to move forward with their smart city plans, more collaboration with utilities is needed. On the final day of the Innovation Accelerator, the group convened for a special panel session to hear about the benefits and challenges of cities and utility companies working closer together. The conversation focused on opportunities and obstacles, and panelists also provided current models that are working and tips for getting started.
Panelists gave many examples of how utilities and cities are working together to transform their communities. This includes:
- Updating lighting with smart street lights that are equipped with sensors.
- Exploring options for energy storage to ensure the system works optimally.
- Encouraging the transition to more efficient and environmentally-friendly energy sources and modes of transportation, including building infrastructure to support electric vehicles.
- Witnessing a change in consumer attitudes as energy efficiency is prioritized, and smart home technology is embraced.
One of the biggest opportunities mentioned was the switch to renewable energy sources such as solar and wind. By working with utility companies, cities can be better positioned to reach state and local environmental goals while ensuring that citizens get the services they have come to rely on. Programs such as Green Alternative are also helping to boost knowledge and acceptance of alternative energy in the larger community by installing solar panels on homes in low-income neighborhoods at no cost to residents.
While there are a lot of promising developments on the horizon in the area of smart energy, there are also obstacles to implementing these projects as well as challenges in forming collaborative partnerships between utilities and cities. Some of the obstacles mentioned include:
- Utilities are constrained in what they do because they have to work under strict regulations and must report to the public utility commission. The system is slow and doesn’t allow utilities to be as innovative and nimble as they’d like to be.
- Cities and utilities can often be at different stages in their thinking about smart cities issues such as connectivity, requirements, how to meter sales, etc. This discrepancy makes collaboration difficult because the two parties are not on the same page in the conversation.
- There have been radical changes in the area of smart energy in regards to new technology, costs, and the business models of the utility companies.
- Although costs for technology, such as solar, are coming down rapidly, costs in some areas are still rather high (for example, energy storage).
- Technical developments must be translated into something that actually changes people’s lives (and then these technical projects must be communicated properly, so residents understand how the changes will positively impact them).
A Model for Collaboration
Perhaps one of the best current examples of collaboration between utilities and cities is Cleantech San Diego, an organization that was formed 11 years ago when California started to ramp up its renewable energy goals. At the time, thought leaders recognized that, in addition to positive environmental impacts, there would also be new economic opportunities available with all the new technologies and companies that would be created to reach these goals.
To realize environmental and economic goals, the organization brought together climate scientists, the startup/business community, the academic community, the utility company, and the city government. The initial partners are still at the table today, and more people have been pulled into the conversation along the way.
Today, the economic outlook for clean tech is $6 billion, and there are about 7,000 people employed in the industry in San Diego. Cleantech San Diego helps to shape local, state and federal policies, promote conversations with city officials, community members and students about clean technology, and support clean tech and sustainability initiatives such as electric vehicles and intelligent lighting.
How to Start a Partnership
Some cities have had great success in collaborating with utilities, and with so many opportunities available in the area of smart energy and clean technology, it makes sense to partner with utilities as part of the broader smart cities plan. At the end of the panel session, one member of the audience asked how a city may spark up conversations with utility companies in order to form a partnership. The panelists offered these tips:
- Go into the conversation as equals.
- Be upfront and candid about what the city is looking for (wants and needs).
- Seek a win-win situation where the utility company helps the city, but the city helps the utility company too (such as via permitting and helping the utility through the regulatory process as a partner).
- Pose ideas for how both parties can work together to create that win-win scenario, but also be open to suggestions.
Participants of the Innovation Accelerator envision that in ten years from now, cities will be getting even more energy from renewable resources, smart technology will change the home, sustainable transportation (such as electric vehicles and efficient mass transportation) will be a priority, and there may even be a convergence of the telecommunications industry. Leaders also predict that cities will have better partnerships with utilities, where improved collaboration and communication will bring about solutions to many of the challenges and problems discussed at this Accelerator.