Strange Bedfellows

by Ellen Sinreich on May 3, 2014

It’s been said that politics makes for strange bedfellows. Well the same rings true for climate change solutions. We’re seeing some very interesting alliances between the public and private sectors when it comes to developing and deploying potentially game changing climate change solutions.

IBM, Zapopan, Mexico, and 115 Other Cities Around the World

Take for example IBM’s Smarter Cities Challenge. In 2011 IBM committed to provide $50M in smart technology solutions to cities across the globe to help those cities use resources more efficiently.

Green City IdeationFive areas were targeted: smart energy, smart water, smart transportation, smart buildings and smart government. Progress in any of these areas means climate change solutions that result in carbon footprint reductions. Over 100 cities ranging from Dubuque, Iowa and Vilnius, Lithuania to Rio de Janeiro and Abuja, Nigeria have been selected to participate.

In our opinion the program could just as aptly have been titled the “Increase Revenue for IBM Challenge.” In 2013 Navigant Research published a report on Smart City suppliers in which it estimated that IBM’s Smarter Cities Challenge created a global market opportunity for “smart city” that would grow from $6.1B in 2012 to $20.2B in 2020. We think that the creation of a $20B+ revenue generation opportunity is pretty smart on IBM’s part, and a stellar example of how aligning  strange bedfellows — for example IBM and Zapopan, Mexico —  around climate change solutions has the potential to create billions and even trillions in top line revenue generation opportunities.

Verizon Wireless, Philips, Ericsson, and Smart Street Lights

Other examples include a more targeted version of IBM’s Smarter Cities initiative where Verizon Wireless is working with European technology companies Philips and Ericsson on a pilot project in the U.S. that will combine energy efficient street lighting with mobile phone infrastructure. The goal of this alliance is a win-win-win for cash strapped municipalities and private sector partners. In addition to creating a source of ongoing municipal revenue through the rental of street lights to mobile phone carriers that want to increase coverage, the increased energy efficiency of the new street lights (which the municipalities will purchase from their private sector partners) is estimated to result in savings of about 50% compared to traditional lights and a commensurate, ongoing carbon footprint reduction for the municipalities.

Amsterdam, A Soccer Team, A Hospital, and Solar PV

Another innovative program that is geared to deliver climate change solutions as a result of out-of-the-box alliances is taking place in Amsterdam. After recognizing that subsidizing solutions to improve the efficiency of its energy infrastructure was not resulting in bottom line improvements for the city, Amsterdam began investing in local startups that were developing innovative technologies, and fostering partnerships between local businesses to enable them to take advantage of these new technologies. Although it is too soon to tell if city coffers will be fuller as a result, Amsterdam can point to at least one innovative climate change solution alliance: a local Amsterdam soccer team paid a nearby hospital to generate electricity for its home matches by installing solar panels on the hospital roof. We think that’s a pretty cool way to generate financial and environmental returns.

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