Business Models and KPIs for Smart Cities

smart city, megacities, KPi, open data, smart metering, smart grid projects, dossier, Boyd, Strategy

Cities generally do not have a global picture when it comes to the improvements made available by the Internet of Things. The role of a supplier is to smoothly translate the city’s needs into smart solutions, with adapted KPI’s.

The Smart City is the city of the future. What do we mean if we are talking about Smart Cities and how can we measure it?

Smart Cities are highly energy and resource efficient, increasingly powered by renewable energy sources; they rely on integrated and resilient resource systems and highly efficient in terms of transports, connecting people for health, education and jobs.

The application of information, communication and technology are commonly a means to meet these objectives.

Some of the cities benchmark their KPI’s against international standards. Professor Boyd is helping cities to develop to a Smart City with his Smart City Index. An overview:

  1. Environment
    1. smart buildings (and homes)
    2. Resource management (carbon footprint, air quality, waste generation, water consumption)
    3. Sustainable Urban Planning
  2. Mobility
    1. Efficient clean energy transport
    2. Multi-modal Access to public transport
    3. Techn. infrastructure (real time information)
  3. Government
    1. Online services
    2. Infrastructure (wifi, broadband, sensor, integrated health and safety operations)
    3. Open government (open data, open apps, privacy)
  4. Economy
    1. Entrepreneurship & Innovation (new startups, R&D, employment levels, innovation)
    2. Productivity (GRP per capita)
    3. Local and Global Connexion (exports, international events hold)
  5. People
    1. Inclusion (internet connected households, smart phones penetration, civic engagement)
    2. Education (secondary education, university graduates
    3. Creativity (foreign burn immigrants, urban living lab, creative industry jobs)
  6. Living
    1. Culture and well-being (life conditions, Gini index, Quality of life ranking, investment in culture
    2. Safety (crime, smart crime prevention)
    3. Health (singel health history, life expectancy)


Amsterdam has implemented a system to measure the economic, environmental, social end cultural outcomes from their smart city initiatives. Many of the smart city projects have a target reduction in CO2 emission, and the city tracks for each project the actual CO2 reduction against the target.

The city measures the number of jobs created as a result of the smart city initiatives and has developed a method, estimating the financial return on investment on the smart city platform.


Barcelona is collaborating jointly with the city of Buenos Aires in the Smart city Index. New revenue: Barcelona has reduced its parking costs by 22% while increasing its parking revenue by between 20-30%. With the implementation of smart parking solutions, cities can increase efficiency, reduce time wasted in traffic congestion, introduce simple automatic billing, etc.

Align with the long-term vision of the city

Barcelona City Council created a new department called Urban Habitat. This department grouped several sectors: urban planning, ICT, energy, environmental, urban services, infrastructure etc. A coordination team is dedicated in finding synergies among the smart city projects. The team also ensures that the projects align with the long-term vision of the city.

Environment savings in France

In France, 20% of drinkable water is spoiled by leakage attributable to aging pipes. By implementing smart water grid solutions, a city can reduce consumption and thus save money.

When measuring the success of a smart city initiative, relevant KPIs could be simple, quantitative ones (the number of 0-emission buildings for example, or a measurable increase in parking revenue), or they could be more complex, qualitative improvements (such as an increase in the city’s attractiveness, or greater happiness among citizens).


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Megacities: challenges for mayors, engineers and planners (dossier)

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