A growing number of global cities are approaching smart transformation through a series of smaller projects, typically costing a few thousand to a few million Euros. Public sector budgets are often insufficient to take advantage of the benefits of smart city development, and so alternative forms of finance from the private sector has become a priority. This global study estimates the potential accessible funding that the top 40% of cities could be raising from private sector asset finance for these smaller-scale ‘˜SmartStart’ investments.
In order to understand how a wide range of cities benefits from these lower-risk, high-ROI-dependability smart investments, nine early stage smart initiatives have been identified, referred to collectively in this report as SmartStart. These are:
- building controls (energy efficiency),
- improved medical technology,
- citizen self-service online,
- vehicle routing,
- parking systems,
- road pricing,
- mobile workforce enablement,
- e-bus and e-vehicles,
- low-energy street lighting.
In order to select the most appropriate financier for SmartStart projects, public sector financial managers point to four key defining factors:
- Diversity ‘“ drawing on a wide range of financing sources ‘“ public and private sector ‘“ and applying each financing technique as appropriate to the relative dependability of ROI that the smart initiative will produce Ease and flexibility ‘“ allowing cities to raise the finance
- Ease and flexibility ‘“ allowing cities to raise the finance they need, when they need it, on terms that make sense for their particular circumstances, supported by customer focused processes
- Expertise, appropriateness and transparency ‘“ from financiers who understand the public sector and its challenges and the role of equipment and technologies to address those challenges, and can therefore offer customized finance solutions, linked to desired outcomes that assist financial planning
- Reliability and sustainability ‘“ from financing partners that have a track record with, and commitment to, the public sector and are looking to build long-term customer relationships