Note: This is the full version of an article that appeared previously as an excerpt, found here; it also forms part of a major new report on the state of smart city funding, which can be found here.
Cardiff, the capital city in Wales, has just upgraded 18,000 street lights. The new lanterns are efficient and smart. And yet the business case for them, or for their ‘intelligence’, at least, is not straightforward. Indeed, the city’s bright city lights capture perfectly the challenge for smart cities – how to pay for the them in the first place. But its experience also describes how cities, everywhere, can approach the challenge of new digital projects.
Matt Wakelam, head of infrastructure and operations at the city council, assembled the original case. “Let’s put it on the table: smart cities are expensive,” he says. “A lot of it is hard to make a return on. It’s intangible – you can’t get a hold of it.“
The standard line from lighting companies is cities will save about 50 per cent on energy costs by switching to LED lights, and make their money back in a couple of years. Cardiff has spent £6 million on 18,000 out of 42,000 in total; the first tranche are scattered around its centre, on eight-metre poles, or higher. It is turning its attention to residential areas next. Signify has been handed the work.
Wakelam – “smart cities are expensive”
But the trickery comes with the central management system (CMS), also from Signify. Cardiff paid £800,000 as well to connect its lights with 2G SIMs to the back-office control platform. This system makes the lighting ‘smart’, giving the authority control. “I can sit at my computer, and turn them on and off, dim them in the morning, know if there’s a voltage surge” explains Wakelam.
But the financial impact of all of these controls – the dimming, the early warnings, the quick fixes – is hard to quantify. “The CMS is not the driver for savings; trying to make that £800,000 back is not straightforward.” The city would not have been able to make the case for the CMS if it had already switched to LED lighting, he says. In the end, it only bankrolled the smart controls because of the energy savings from the bulbs.
“I’ve gone from the 150-200 watts to the equivalent of 60 watts on the lantern. I can see my bills coming down. The only way to make the CMS add up was to bundle it with the LED because that’s where the saving is.”
Technology vendors peg the savings from adaptive control at 25 per cent of the running costs of older systems (see page 15), with a proportion of these additional savings from lower maintenance costs. But the UK’s austerity drive has hit all parts of government, and Cardiff doesn’t spend that much on fixing street lights, anyway. “I don’t have 20 electricians on the road; even in a city like Cardiff only has three.”
Still, the simplicity and dynamism of the control system has been striking. The old controls from lighting firm Mayflower were expensively assembled and hard to use. The new system is a breeze, with LEDs lighting up on the dashboard as they are connected. “The old system was – how can I say – unintuitive. Even my street lighting engineers couldn’t use it. With this, your kid could work it,” says Wakelam.
In the end, dimming is the key to making the additional investment back. “I’ve over-specified the lighting; my lanterns are at 70 per cent intensity.” The old apparatus offered one-speed functionality, with a dimming ballast installed in each lighting column. “If I’d wanted to change the schedule, or dim it more, I’d put a new ballast in.”
The most striking part of Cardiff’s work with its lighting has been the way it has brought city elements together. While the lighting can be dimmed to reduce energy consumption, it can also be switched to full-beam at any moment. “If there is an incident in the road, I can turn it right up.” The emergency services in Cardiff can take charge of the system from the city control room.
More than this, Cardiff is working with local enterprises to explore ways lighting can impact footfall and sales, influencing the local economy and job market by extension. It is in talks with city’s cafe quarter, on the quayside, about relinquishing some control so it can lower the lighting and raise the mood. “They want to get punters through the door. And it’s not my lighting, actually – it’s paid for by their taxes and business rates.”
It sounds like a powerful proposition, suddenly. It is, says Wakelam; but he explains, again, the maths has not been finished. “It is powerful. But when you’re making the decision to buy, and you’re setting out a business case, it’s difficult to put numbers against all those things.”
Does Cardiff expect to make all of that £6 million back, plus the £800,000 investment in the CMS? “Yes,” he says. The city took an zero-interest ‘invest-to-save’ loan from the UK government, available from its so-called Salix fund for green-tech. Cardiff has seven years to pay it back; it will do so in four, it reckons.
The city is pushing its new system hard. The core solution remains unadulterated, as a lighting-and-control setup. The case has not been made yet to supplement the basic stack with additional sensors. “We’re just making the most of the CMS”. But the city is moving on; the next phase is to extend to residential neighbourhoods.
The latest Signify system features plug-in points for new gadgetry. The city’s one concession has been to add pedestrian sensors in a pilot on a single street, so the lights respond to movement. The question is whether to extend the trial. It faces challenges, however. “It’s a big step-change to have this Michael Jackson scenario, where the lights come on as you walk down the road. People don’t like change, and some don’t like LED lighting because it’s a different style,” says Wakelam.
This the other difficulty is to make the business case when the old residential system was not as energy hungry, and therefore the new saving do not look so considerable. “We can’t get the residential model to ‘wash its face’ – because the [lower] LED levels don’t give you the same energy saving, in relation to the cost of the of the lantern. It requires a lower power lantern to start with,” explains Wakelam.
But Cardiff has bided its time before. “We waited until we were comfortable with the technology.” Like most UK authorities, it watched Trafford Council in Manchester blaze a trail withn LED lights in 2014, almost to the High Court, as a local resident threatened legal action. Cardiff consulted with residents, and even the Trafford agitator, and elected to fix the lighting ‘temperature’ at 3,000 Kelvin “across the city”, around half the colour setting of most setups.
The city has made the business case work so far by taking its residents and businesses into even closer consideration. “It is not about lighting for the council, but lighting for the people,” says Wakelam.
This is article appears in a report and webinar from Enterprise IoT Insights, titled How to buy / sell a smart city – procurement models to make every city smart. Read the report here, and the webinar here. Sign up to the Enterprise IoT Insights newsletter here.
