A new report from boutique research firm Navigant Research shows the global smart city technology market is expected to more than double in the coming years, from $10.4 billion in 2015 to $27.4 billion by 2023.

The firm tracks a complex matrix of issues, solutions, technologies, operations, and infrastructural requirements related to smart cities, and new projects have been added to the database – showing continued investment in smart grids, networked LED street lights, urban mobility, climate action plans, open data platforms, water management, and government service applications for smart cities.

“The expansion of smart city projects is happening not only in terms of the quantity of projects being developed but also in relation to the level and variety of integration being pursued,” says Ryan Citron, research analyst with Navigant Research. “This expansion is expected to increase as governments continue to recognize the tremendous associated benefits of smart cities, including improved economic opportunity, sustainability, and quality of life.”

Citron says they see continued investment in technologies like advanced parking systems represent a growing market for smart cities. As well, an increase in innovations from suppliers in terms of the product and solution offerings – as well as the partnerships they are forming with cities and other stakeholders – is expected to further propel the industry’s growth.

This most recent report covers five key industry sectors as they relate to smart cities: smart energy, smart water, smart transportation, smart buildings, and smart government, looking at across sectors at projects that address multiple aspects of city operations.

They identified 235 projects around the world. Roughly 85% of the projects are focused on issues related to energy, transportation, or government. That’s up from 170 projects in the third quarter of 2013 when the firm first began looking at the smart city space.

                                                                                 Courtesy: Eneltec LED

Navigant see developing world with strongest demand

Smart city development is a huge growth area in the developing world as well as the big economies. Indian Prime Minister Narendra Modi’s “Digital India” plan has them building 100 smart cities across the country. They’ve allocated $1.2 billion for Smart Cities in their 2014-15 national budget.

As you can imagine, the scale of this development plan acknowledges the public resources would largely be insufficient. And so the government is working on new financing routes to boost the program. The government has also been inviting foreign partnerships, signing deals to build the first eight of the 100 cities — three with German partners, three with American partners, and one each with Spain and Singapore.

“Cities in the past were built on riverbanks (and now) they are now built along highways,” Modi said. “But in the future, they will be built based on the availability of optical fiber networks and next-generation infrastructure.”

As the benefits of smart cities become clearer, the number of projects and partnerships supporting the cause is rapidly increasing. In the last few years, city leaders, central government ministries, and technology and service suppliers have announced a range of new smart city initiatives, incentives, and product and service offerings, while more cities are moving from one specific technology interest to a broader range of solutions that have multiple applications.