Navigant Research Blog

Using Data to Drive Urban Transformation

— February 1, 2012

As I mentioned in my last smart city blog, one of the biggest challenges to realizing the smart city vision is finding financial models that can enable the transformation in city operations.  This recent Climate Group report highlighted the opportunity offered to cities through better exploitation of one of their most critical and under used assets: data.  The most obvious use of city data is for the city authorities and service providers to become better at collecting, analyzing and acting on information about how the city works.  While public sector organizations – not only city authorities – have gone a long way in creating modern IT-based front- and back-office organizations, they have generally been much slower than the private sector to use the power of data analysis to understand how to improve those processes.  This is now changing, and city authorities are beginning to understand the power of data analytics.  But even with cloud computing and software-as-a-service models helping to reduce costs and speed up deployment, data analytics and advanced information management systems still involve a significant upfront investment, and payback depends on finding efficiencies and improvements in services.  A more radical – but complementary – approach is to open the data to third parties to allow them to provide new services and new insights.  This is one reason why cities are at the forefront of the movement for open government data.

The momentum behind open government data gained significant impetus with the release of President Obama’s “Memorandum on Transparency and Open Government” in January 2009.  This paved the way for the launch of in May 2009, a web portal that today provides almost 400,000 raw and geospatial datasets and more than 1,000 web apps.  The U.K. government launched in April 2010.  Both the U.N. and the World Bank are now working to encourage governments around the world to adopt open data policies.  As well as spurring innovation, opening up government data is seen as a means for tackling corruption, increasing transparency and improving accountability.  In July 2011, Kenya became the first developing country to have an open government data portal.

Trying to put specific value on such data is difficult, but a report from the European Commission suggests that opening up public-sector information could be worth up to €140 billion (almost $200 billion) to the EU economy each year.  Cities have been among the most proactive governments promoting the possibilities for open data.  In the United States, cities like San Francisco, New York, and Chicago have launched open data portals, as have London and Barcelona and Helsinki.  A number of cities have also launched developer events and competitions to encourage the creation of new applications that can then be made available on the city website. 

Transparency, Accountability

So why is this important to the development of the smart city concept? Most importantly, opening up data to new uses is a way of refreshing our ideas about the city: how it works and how it could work better.  It also frees up the potential for further exploitation of new technologies such as smartphones and sensor networks.  Open data can also provide a boost to the city as center for software development and other digital industries, as the Mayor of New York has recognized with his promotion of NYC Digital

Chicago provides a good example of what can be achieved.  In January, the city launched a new web site, Chicago Shovels, which keeps residents informed in real-time about the activity of the city’s snow ploughs when the blizzards hit.  In future, it will provide space for coordinating community-based snow-clearing teams.  It also provides additional applications developed by third-parties using the city’s open data sets., for example, alerts drivers of winter parking bans, while uses the City’s towed and relocated vehicle data to reconnect owners with their cars.  Sites like Chicago Shovels are not just providing new services, they are also making new aspects of a city’s operation transparent.

The CTO of Chicago has written an excellent blog on the city’s open data platform.  In the post he describes the four principles that have driven the program: transparency, accountability, analysis, and open data.  Looking to the future, he also talks about the emerging concept of the “city-as-platform” – an idea I will examine in more detail in my next blog.


A Small Car for the Smart City

— January 31, 2012

Last week saw the official unveiling of the Hiriko electric car in Brussels, in front of the President of the European Commission Jose Manuel Barroso.  A trial manufacturing run of the vehicle is set to begin at Vitoria Gasteiz, outside Bilbao, next year and the first models are expected to reach the market in 2013.  Several cities have apparently already shown interest including Berlin, Barcelona, Malmö and San Francisco. 

Developed by a consortium of seven companies based in the Basque region of Spain, Hiriko Driving Mobility is taking forward a design for a CityCar first produced at MIT.  The Hiriko has several city-friendly features, but the most striking is its size and the fact that it folds up to fit into the smallest of urban parking spaces.  At only 2.5m (100 inches) in length unfolded, when crunched up for parking it takes a measly 1.5m (60 inches) in space.  The vehicle’s wheels also turn at right angles to help sideways parking in tight spaces and the lack of conventional doors mean that you can still get in and out the vehicle.

The transport challenges facing city leaders were the subject of some of the most interesting sessions at last November’s Intelligent City Conference, in Hamburg.  Amongst lengthy discussions about multi-model transport strategies and the pros and cons of road charging schemes, several presenters raised the importance of rethinking the role of the private car within our cities.  This is not only about the need to encourage EVs, or to accelerate the shift to public transit systems, but also to foster new thinking about car design.  We need to design cars that meet the needs of cities, several speakers declared, and move away from shaping our cities to accommodate cars. 

That’s the basic idea behind the Hiriko (which means “urban” in Basque).  The developers say that it’s well-suited to electric car-sharing schemes, similar to those already in place in San Diego and other cities.  Other options might include the use of advertising to pay for the car rental, or sponsorship by hotels, restaurants or other local businesses.  Operators and city transport authorities might also consider time-of-use pricing or incentives to encourage the use of alternative pick-up and drop-off points during busy times.

The Hiriko may horrify lovers of classic car design, but for anyone interested in the future of urban transport it offers some intriguing possibilities. 


Kick-Starting the Bio-Based Economy

— January 30, 2012

Massive, varied, and intricately woven into the fabric of modern industrial society, the global chemical industry was valued at over $4 trillion in 2011, according to Pike Research’s Green Chemistry report.  The non-pharmaceutical chemicals industry in the United States is valued at around $700 billion per year. 

The rise of bio-chemicals promises to transform that industry.  Bio-based chemicals and plastics – often referred to as bio-based products – are commercial or industrial products (other than food or feed) that are derived from biological products or biomass.  They serve as direct replacements for the building blocks used in petrochemical production. 

At last week’s 3rd Annual Bio-based Chemicals Summit, in San Diego, upstart biomass innovators and stalwart petrochemical industry stakeholders converged to capitalize on opportunities in the emerging bio-based economy.  Excitement is high, but it is largely a derivative of unrealized potential in the biofuels industry.  That potential could be accelerated by federal action: this week, President Obama is expected to unveil his Blueprint for a Bioeconomy.  (The bio-chemical sector is covered under our Bioenergy Advisory Service, which was launched last week.)

The bio-based segment of chemical production looks poised for dramatic growth.  As discussed in our recent report, Biofuels Markets and Technologies, there has been a significant shift away from a primary emphasis on biofuels production towards high-value, low-volume bioproducts in the last couple of years.  Currently, the US Department of Agriculture (USDA) estimates that at least 20,000 bio-based products are currently being manufactured in North America.  USDA has certified dozens of products with a “bio-preferred” label, which denotes a high percentage of bio-based ingredients. 

The shift in strategy away from biofuels and towards bio-based products aims to generate near-term revenue to facilitate broader scale-up efforts.  Ultimately, stakeholders envision a pervasive, renewable bio-based economy, comprising power, heat, fuel, and chemicals production derived from biomass resources.

The strategy flies in the face of existing biofuels policy in the United States, which one presenter in San Diego called “ass-backwards.”  From subsidies to loan guarantees to grants, the federal government has relied on a number of mechanisms to ramp up biofuels production.  Where there are bio-based chemical incentives, they are typically treated as complimentary to biofuels policy.    

Shifting this paradigm is of chief concern among bioproduct advocates.  Bioproducts, the logic goes, are a natural stepping stone to biofuels production, which is tasked with supplanting an entrenched and highly profitable petroleum fuel industry.  The price tag for doing so is daunting – roughly $16 billion per year to meet the Renewable Fuels Standard (RFS) mandate.  Requiring less capital and feedstocks, widespread bioproducts production is viewed as a lower hurdle that can spearhead development in the utilization of biomass as a replacement to crude oil. 

Despite its promise, the bioproducts market faces many challenging obstacles that will likely stifle growth in the United States over the near-term.  Three key issues are summarized briefly below: 

  • First, EPA’s regulation of industrial chemicals under the Toxic Substances Control Act (TSCA) may lead to delays and increases in the time-to-market.  While bio-based chemicals are subject to review, many petroleum-derived chemicals were grandfathered in when the regulation came into force in the 1970s.
  • Second, limited access to feedstocks may confine production to areas with access to regional biomass supply chains, potentially stifling growth in the industry.  Even where feedstocks may be prevalent, cost remains a barrier to the commercialization of biobased production from advanced (non-commodity) feedstocks, such as camelina, jatropha, algae, and switchgrass.
  • Third, accessing capital for scale-up remains a difficult challenge.  Although higher-value bio-based products require less capacity than biofuels production, many investors are wary of building a first plant given the associated technology and market risks.  Without steel in the ground, it’s difficult for the industry to accurately assess the risks of subsequent investment.

Building Automation’s Babel Problem

— January 30, 2012

There’s a lot of promise in energy management systems.  Buildings produce tons of data every minute of the day, and much of it is fed into building automation or building management systems so that facility managers can monitor and control energy and operations.  In our recent report, Building Energy Management Systems, we observe that these systems are starting to take that data one step further by visualizing and quantifying energy in buildings for CEOs, building occupants, and other key decision-makers.  Getting this information to the right users, though, involves pulling data from a number of separate systems (lighting, HVAC, security, etc.), which becomes an exceedingly difficult process when systems communicate using different protocols, such as BACnet, LonWorks, Modbus, and many others.

Here’s the problem: While it is certainly possible to tie together systems (say, an HVAC automation system based on BACnet and a lighting system based on LonWorks) into a single energy management system, the cost of the labor required to integrate systems cannot always be economically justified.  Moreover, in many cases, the automation functionality of two independent systems on different protocols is often higher than a system that integrates the two, as much of the data is lost in translation.

So how did we get to this modern-day building automation Tower of Babel?  BACnet was originally developed in the late 1980s in association with ASHRAE, the HVAC industry association, and is one of the leading protocols in the U.S., particularly for HVAC and lighting control systems.  LonWorks, the other top protocol in the U.S., was developed in the 1990s by Echelon, one of the leading smart grid and automation technology firms in the world.  While BACnet’s association with ASHRAE has curried favor among HVAC vendors, LonWorks has been a favorite among lighting controls manufacturers given its rapid response time.  Other protocols serve other niches or are favored by specific vendors as a way of discouraging mixing-and-matching of products from competitors. 

The result is a world in which systems that perform very similar functions can’t communicate with each other.  Imagine if Blackberry owners couldn’t call iPhone owners.  That’s the basic reality in the building automation systems world today.

Last week, Echelon made a major step toward breaking these barriers down through the launch of a suite of tools and products aimed at integrating systems based on LonWorks and BACnet.  This is a particularly fitting move for Echelon, which is the gatekeeper of the LonWorks protocol and is carving out a leading role in developing technologies at the “edge of the grid,” the interface between buildings and the utility distribution network.  Through the platform, which involves hardware, software, and service components to translate between LonWorks and BACnet for rich energy management, Echelon will be able to connect with whole buildings, not just isolated systems within buildings, and prepare them to play a role in overall grid management through demand response and other types of utility programs.

Over time, automation systems will likely shift to IP networks for new buildings, doing away with the polyglot automation world of today.  However, the existing building stock will continue to speak many languages, and solutions such as Echelon’s will play an important role in synthesizing building energy data to make buildings smarter and more energy-efficient.


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