Accelerating the urban energy transformation: the role for utilities

For years, I've been urging cities to value utilities as essential partners. And urging utilities to see cities as a source of support for the rate changes and business model changes necessary for modernization. Now Navigant analyst Eric Woods has framed the discussion in a way that's the best I've seen. It should be required reading for any and every utility executive. It only takes a few minutes to read, but it could influence what you do (and who you do it with) for years to come. Please take a look. And please pass it along to your colleagues. — Jesse Berst


By Eric Woods, Navigant

The announcement that Chicago will join the list of cities making a commitment to renewable energy is further evidence of the growing interplay between the urban technology revolution represented by smart cities and the transformation that is reshaping energy markets.

As a result, we are seeing cities around the world playing an increasingly significant role in shaping the evolution of the energy markets. The influence of cities ranges from support for smart grid investments in urban infrastructure, to the setting of ambitious renewables targets in cities like San Diego and Copenhagen, and even the creation of new energy companies, as in Bristol in the UK. Cities are increasingly challenging utilities to help them to deliver on ambitious visions for a clean and renewable energy future.

But what does this mean for utilities? In our assessment of smart city programs globally, Navigant Research has identified five key factors for successful smart cities. Each of these factors presents an opportunity for utilities to establish their own place in these new urban ecosystems.

  • Strong leadership from cities and executives is vital to develop a coherent and sustainable smart city strategy. Utilities need to be engaged with both and participate as active players in local smart city stakeholder groups and leadership teams.
  • Successful cities focus on local priorities and build on existing assets to develop a distinct smart city vision that is aligned with the needs and goals of the community. Utilities need to work with cities to define a future energy roadmap embedded in local realities – how does a city get from here to there to meet its ambitions?
  • Local communities need to be involved in all aspects of smart city development, from initial strategy to project design, deployment, and data collection. Utilities have an important role in ensuring existing and new community energy projects are a part of all smart city programs.
  • Close collaboration across public sector agencies, the private sector, and academia is essential to driving city innovation programs. Utilities should be key players in emerging smart city networks and can be catalysts for new types of collaboration.
  • Innovative use of big data for policy development and the creation of new services will be a hallmark of any smart city. Energy data is a valuable element in city data platforms and utilities can be proactive players in shaping new data markets.

For utilities, the assertiveness of smart city leaders and a desire to challenge the status quo presents further challenges to existing business models but it also offers significant opportunities as they reinvent themselves for the age of clean energy.

To understand more about how smart cities and the energy transformation are intersecting, please join us for the upcoming free webinar from Navigant Research, Smart Cities and the Energy Transformation on April 25 at noon EDT. Click here to register.