Can smart cities help improve energy access in India?

India is on a mission to implement 100 smart cities by 2020. Is this an opportunity to increase access to energy and technology for the ever-growing urban population?
Published: Tue 03 Apr 2018

In 2015, Indian Prime Minister Narendra Modi announced the Smart Cities Mission, a programme with the ambitious goal to modernise 100 Indian cities in five years.

Cities from all over the country were gradually selected to participate in the programme since 2015, and they will undergo processes such as retrofitting, renewal, and greenfield development to become smart.

The cities should contain features such as applying an intelligent traffic management system in public transport, smart meter installations, waste water recycling and improvements in the waste management system.

As part of this 'smart awakening' in India, the European Union has partnered with the country on a cooperative mission to incentivise urban and sustainable development. In addition, several European Union (EU) countries have announced technical and financial support for the initiative, such as Germany, which is partnering with the Indian government to provide insight from its experts to the programme. France is also partaking, and it is reportedly investing $1.5bn in the initiative as well as lending technical expertise.

Smart cities and digital inclusion

At Engerati we believe energy is a ‘killer app’ for smart cities and a missing piece of the equation in the Indian context. As well-intentioned as the Smart Cities Mission may be, analyses have shown that project implementation could have troublesome implications. Turning some Indian cities into ‘technology hubs’ with state-of-the-art smart solutions might make them elitised spaces for selected parts of the population.

India’s first operational smart city is a good example. Gujarat International Finance Tec-City (GIFT City) is being built as India's international business and financial centre. It will present features such as a district cooling system, automated waste management system, smart traffic monitoring and an interconnected CCTV network, among others. Though already functioning, construction of the city is only expected to be completed around 2025, and its developing costs should reach as high as $10bn.

Likewise, Smart Cities Mission should receive around $10bn in funding to be distributed equally among its 100 participant cities, as well as rejuvenating 500 cities and towns. Investments will likely go towards equipping cities with the aforementioned new technologies and smart solutions.

The kind of technologies used in smart cities tend to favour the already wealthy and well-connected - for example, to have access to smart home energy management apps, check live traffic or public transport routes, a smartphone is likely needed.

And, though the number of smartphone users in India is steadily growing, in 2017 they numbered at 299.24 million, in contrast with the country's population of 1.324 billion. In addition, according to 2016 data collected by the Telecom Regulatory Authority of India, urban populations have 61.9 internet subscriptions per 100 people, while rural India only has 13.7 subscriptions per 100 people.

Additionally,  as of 2015, it was estimated that 300 million people in India lived with no electricity. These numbers provide a good idea of how much of the population could actually enjoy the amenities and digital advancements smart cities have to offer.

In a monograph for a smart cities conference in India in 2015, economist Laveesh Bhandari said: "When we build these smart cities, we will be faced with a massive surge of people who will desire to enter these cities. [...] There are only two ways of keeping people out of any space - prices and policing.”

"In other words, the prices will automatically be higher in such cities - the notion that they will be low cost is flawed. Even if possible from a cost of provision perspective, they cannot be low cost from a demand supply perspective."

Criticising the notion that smart cities can become spaces for socioeconomic segregation, Bhandari added, “When you invest so much without thinking about services and low-cost housing and governance, then you will end up creating enclaves that keep out the poor.”

Integrating energy access into smart projects

While the Indian government is also committed to providing energy access to all by 2022, both this project and the Smart Cities Mission are likely to highly increase demand on the national grid.

The World Economic Forum predicts that, given the circumstances, one scenario is that smart cities will receive energy to fulfil the demands of its inhabitants at the expense of a more vulnerable parcel of the population. Smart cities might be prioritised as they attract the larger share of corporate financial investment and international attention. Alternatively, both projects can be fulfilled but not in a satisfactory manner.

So how can smart cities help enable energy access?

The answer to this question is not simple. In order for smart cities to be more inclusive and egalitarian, projects should take into consideration budget allocation for digital inclusion, affordable housing and energy, among others.

This is particularly important in developing countries where social and economic inequality is more pronounced. In addition, large cities tend to be the most socially unequal places in most countries, where representatives of the very highest and the very lowest socioeconomic strata live.

However, if smart city projects are crafted conscientiously, they can represent an opportunity to integrate rural and urban communities. Smart solutions and internet connectivity can be fitted to smaller villages and towns. Another option to increase energy access is to install mini and microgrids in regions where access to energy is scarce and unreliable, such as a project carried out by the Rockefeller Foundation which used mini grids to bring smart power to communities and reported significant economic improvements as a result.

In reality, the issue is complex and delicate, but these are some of the ways in which smart cities can democratise energy access. They can also use this feature in itself as a means to lessen economic disparities and social issues stemming from inequality.

In the context of developing countries, smart cities must show a visible societal benefit, and energy access can provide this cornerstone.