Smart Is the New Green: How Smart Cities and Homes Can Save Our Planet

August 05, 2021

Currently, more than half of the world’s population lives in towns and cities and more than 80% of the global GDP is generated in cities (“World Urbanization Prospects: 2018 Revisions” 2018). By 2050 the world population in cities or urban areas could swell to about 66%, adding more than 2.5 billion people to the urban population (figure 1).

Figure 1: Urban vs Rural Population Globally
Source: UN

Rapid urbanization puts tremendous pressure on population centres and presents a challenge for cities to provide environmental sustainability and ensure the physical security and safety of residents.

According to estimates by the World Economic Forum, in 2018, citifies or urban areas accounted for up to 70% of total energy consumption and were responsible for more than 60% of total greenhouse gas emissions (“World Urbanization Prospects: 2018 Revisions” 2018).

Figure 2: Total energy consumption and greenhouse gas emissions (%), cities vs other areas in 2018
Source: UN

Enter the “smart city” concept

The “smart city” is a concept of how cities can be fundamentally improved by integrating technology and data analysis to optimize resource management, drive economic growth, and increase quality of life.

A smart city is a city in which technologies such as the internet of things (IoT), artificial intelligence, sensors and communication systems are employed to enable various objects and entities to communicate with each other through the internet. It is designed to optimize resource consumption, improve adaptability, and address sustainability.

Everything from vehicles to security cameras, skyscrapers to garbage bins, homes to streetlights are infused with technology to communicate data, manage resources and prioritize services.

The end-result is structures that are better able to manage its resources, mitigate congestion and crowding, and be tremendously more efficient than any other form of infrastructure.

The “Smart Home” concept would complement smart cities but at a household level

By integrating ICT within the structure, smart houses achieve what smart cities do at an individual level. Allowing individual households to reduce energy consumption wherever possible, minimize waste products generated, and generally enhance quality of life.

Smart cities and smart homes offer promising solutions to urbanization issues

Smart cities provide a solution for alleviating environmental externalities by more efficiently managing resources to create new economic efficiencies.

According to Siemens, smart cities can bring down the energy consumption of cities by 30% and substantially cut down on traffic (“Data-Driven Cities” 2020). McKinsey reports that it “could cut emissions by 10–15%, lower water consumption by 20–30%, and reduce the volume of solid waste per capita by 10–20%” (Woetzel and Remes 2018).

Some cities are already being equipped with “smart technology” to optimise resource use

In Amman, Jordan, for example, the city has adopted a data-driven approach to streamlining the waste management process (Zgheib 2017). City officials can now monitor factors such as waste tonnage per district and complaints resolved, and track vehicles through a new fleet management system. Garbage trucks that once returned nearly empty are now redirected to routes where full trucks have skipped collections.

Further, the city of Barcelona has adopted smart technologies by implementing a network of fiber optics throughout the city, providing free high-speed Wi-Fi that supports the IoT (van den Bosch 2018). By integrating smart water, lighting and parking management, Barcelona saved EUR 75 million of city funds.

What do the Smart City and Smart Home market encapsulate?

The architecture of a smart city encapsulates a range of different services, technologies, and actors to collect data and enable processing to optimise operational efficiency.

While there are many ways to possibly visualise how such components are connected and utilised, it is perhaps best visualised in its simplest form as a 4-layered architecture of sensing, communicating, processing, and applying as described in figure 3.

Figure 3: Architecture of “Smart Cities” and “Smart Homes”


“World Urbanization Prospects: 2018 Revisions”. 2018. Population.Un.Org. https://population.un.org/wup/Publications/Files/WUP2018-Report.pdf.

“Data-Driven Cities”. 2020. Siemens.Com. https://new.siemens.com/global/en/company/stories/research-technologies/folder-future-living/smart-cities.html.

Woetzel, Jonathan, and Jaana Remes. 2018. “Smart Cities: Digital Solutions For A More Livable Future”. Mckinsey.Com. https://www.mckinsey.com/industries/capital-projects-and-infrastructure/our-insights/smart-cities-digital-solutions-for-a-more-livable-future.

Zgheib, Nibal. 2017. “EBRD And GAM To Transform Amman Into A Smart City”. Ebrd.Com. https://www.ebrd.com/news/2017/ebrd-and-gam-to-transform-amman-into-a-smart-city-.html.

van den Bosch, Herman. 2018. “Barcelona: Showcase Of Smart City Dynamics – Smart City Hub”. Smart City Hub. https://smartcityhub.com/technology-innnovation/barcelona-showcase-smart-city-dynamics/#:~:text=Barcelona%20was%20one%20of%20the,to%20adapt%20smart%20city%20technologies.&text=Its%20technology%2Dbase%20is%20solid,Seoul%20outperform%20Barcelona’s%20technological%20infrastructure.

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