The private sector could provide as much as €6.2bn (£5.3bn) of finance for smart city projects across the UK, according to a white paper published by Siemens.
The report says that public sector budgets are often insufficient to take advantage of the benefits of smart city development. This is leading local authorities to turn to alternative forms of funding from the private sector, such as asset financing arrangements, for smaller scale ‘SmartStart’ projects.
Investors can benefit from a clear return on investment, the white paper states.
The study identified nine early stage smart initiatives that have a track record for delivering dependable return on investment and are already being financed through asset financing:
- 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
Projects can last from a few months to a few years, and often generate savings that are realised relatively quickly, UKAuthority reported.
Chris Wilkinson, head of sales for public sector at Siemens Financial Services, said that asset finance for smart city development is available from a growing number of providers.
“Cities around the world are increasingly engaging in smart development to improve efficiency of local services, enhance sustainability, improve the lives of their citizens, and develop their competitiveness,” he commented.
“Private sector asset finance allows cities to make the full range of SmartStart technology investments in a timely manner. By diversifying their sources of funding for smart investments, cities can benefit from the resulting savings and improvements to citizens’ services without any delay.”