The marriage of digital technology, renewable energy and efficiency has been highly disruptive to the traditional utility business model. At the same time, according to a recent study, utilities can benefit, too.

In May, management consulting firm ScottMadden released a study, “The Smart City Opportunity for Utilities,” which outlines ways utilities can leverage their assets to benefit from the emergence of smart cities.


The study defines smart cities in terms of their technological approach to solve problems and plan for the future rather than the technology they embrace. According to ScottMadden, “a smart city is one that employs a network of digital sensors, information controls, Internet of Things technology, and automation to create a system that improves quality of living by reducing costs, creating new and better services, improving sustainability, and helping the city grow and compete for businesses, institutions, and residents.”


Smart cities are an evolving trend. According to the study, cities are applying smart technology in one of two ways to several categories of their infrastructure—including energy, transportation, water and waste, and buildings. 


Integrated, long-range planning involves a comprehensive vision for future functionality. The incremental approach offers quick, affordable results from system enhancements. In both approaches, cities address a range of objectives and goals, including energy efficiency, adoption of distributed generation and renewable power, electric vehicle infrastructure, reduced greenhouse gas emissions, traffic congestion management and a host of other concerns.


The report advises utilities to support cities in this progression in phases. Phase one involves getting more out of the utility energy network. In phase two, utilities can leverage their assets to enable nonenergy initiatives. In phase three, they can leverage utility capabilities to expand into entirely new areas, such as transportation and customer/citizen engagement.


The study identifies smart streetlights as a logical way for utilities to engage with cities in this process. According to ScottMadden, “street lighting projects are a popular entry point into the smart city conversation because of their enormous potential to deliver a strong (and fast) return on investment.”