Utility Week

UTILITY Week 22nd May 2015

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18 | 22ND - 28TH MAY 2015 | UTILITY WEEK Roundtable Future Cities : The Challenges and Opportunities for Utilities 6 May 2015 Future Cities: risk or reward for utilities? Future cities require integrated solutions – and that requires a clear data vision. Jane Gray reports from a recent roundtable discussion. I n a world where growing populations are rapidly urbanising, cities will become nexus points for resource stress and the potentially chaotic unintended conse- quences of poor planning. The potential value for cities, therefore, in bringing together the many different contrib- utors to city infrastructure in collaborative working groups is immense. By encourag- ing the operators of transport, energy, water and communications systems to share data and – using modern simulation technologies – cross-reference their plans, cities can be more confident about their ability to provide safe and resilient environments for citizens to live and work. However, the benefits of this kind of collaborative working extend beyond city authorities. At a recent roundtable debate hosted by Utility Week and global technol- ogy company Autodesk, utility leaders discussed the scope for energy and water companies to enhance their value proposi- tions through greater involvement in future city programmes. Participants at this event expressed a strong interest in future cities as drivers for new business models and consumer engage- ment, but there was also an acknowledged sense of confusion about exactly how to define future cities and what they will look like. A key point that was made early on in the discussion was that we a have gone beyond the demonstration stage – in terms of specific technologies that support smarter energy use and water management, for instance. We now need to focus efforts on ways to integrate disparate technologies and the interconnecting interests of infrastruc- ture providers in order to serve a common customer base better. One attendee from a big six energy sup- plier said that aspiring future cities play- ers should study "network theory" to build a clearer understanding of their roles in relation to collaborative partners and com- petitors. Most agreed that better systems thinking is required before the anticipated value future cities hold for infrastruc- ture solutions providers and citizens can materialise. A point of contention arose over approaches to data sharing as cities strive to be more collaborative operating environ- ments. While it was agreed that approaches to data sharing need to change and become standardised, there was argument over whether the ideal of free data sharing was either viable or desirable for utilities. Scep- tics predicted a more controlled evolution of data sharing, perhaps in the form of licens- ing frameworks for commercial access to data. It was felt this route would give better recognition to the intrinsic value of data. Regardless of which pathway for data sharing proves either right or successful, it was agreed that lack of certainty in the "rules of engagement" for data sharing in future cities is a major barrier to progress. Several participants identified a "stand-off " as companies withhold data from future cit- ies projects "in case someone else makes money from it" – or in case its monetisa- tion causes a problem for customers. Such reticence, however, may risk exclusion from future business ecosystems and lead to a low value role for utilities in future cities. Operations & Assets Citizen versus customer The vision for future cities is, in part, intangible because, as one roundtable participant put it, "they have no controlling mind". They are not a single entity, but rather a system of systems and individuals. Furthermore, individuals as city citizens tend to have different collective values and priorities than the same individuals would express when thinking of themselves as customers. This poses a challenge for utilities' involvement in cities because the industry is regulated for customer value creation, not citizen value creation. A major difference between the needs of the citizen collective and the demands of the individual customer is long-term thinking and, one roundtable participant said, with customer-focused regulation driving utilities into short-term thinking cycles, the likelihood of utilities taking a leading role in the development of smart and sustainable future cities is slim.

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