Sharing Session – Smart City

www.pwc.com

The Hong Kong-America Center

16 September 2017

PwC

Hong Kong and other cities are increasingly recognising the role of innovation and technology in enhancing all areas of urban life

The Government is committed to building Hong Kong into a Smart City as re-affirmed in the 2016 Policy Address. The overall objectives of developing Hong Kong into a Smart City are:

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Making use of innovation and technology to address urban challenges to enhance city management and improvement quality of living, and to improve sustainability, efficiency and safety of our city

Enhancing city attractiveness to global businesses and talents

Inspiring continuous city innovation and sustainable economic development

PwC

Hong Kong has positioned itself well to become a leading smart city and to capitalise on its existing strengths

The Office of the Chief Information Officer (OGCIO) under the Innovation and Technology Bureau (ITB) commissioned PwC to advise on the development of Hong Kong’s Smart City Blueprint. The scope of the consultancy services covers the following areas:

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Blueprint for Smart City development

Dedicated portal for crowdsourcing of ideas

Smart City pilot projects proposals

PwC

PwC advised the Government on the key elements of a Smart City Blueprint

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HK Smart City

Blueprint

8. Smart City Pilot Proposals Nature and scale of individual pilot projects, rough indication of cost, implementation agents, timeframe and opportunities of private sector participation

1. Policy Objectives and StrategySmart city strategies and initiatives and KPIs to assess progress and improvements over time

2. Development Plans Development plans up to 2030 (organised in S/M/L terms) and effective strategy for facilitating the release of more open datasets from public and private sectors

3. Governance Arrangements A committee structure for formulating bureau-specific or sector-specific Smart City action plan

4. Digital Infrastructure Digital framework and standards, mechanisms to ensure information security and privacy

5. Legal Framework Study of legislative proposals for underpinning Smart City development6. Public-Private Collaboration

Recommended business models and collaboration framework

7. Crowdsourcing of Ideas Portal to collect ideas, findings and analysis of public engagement

PwC

In particular, Ideas Crowdsourcing Portal was used as a means to engage public and collect public wisdom

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Collection of ideas from the public

Portal live between28 November 2016 – Mid

February 2017

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Hong Kong needs to consider opportunities and challenges posed by a set of megatrends and local trends

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Meg

atr

end

sL

oca

l tr

end

s

300 million more people in the world’s population will be aged 65 and over by 2025

In 2030, 26.4% of Hong Kong’s population

will be aged 65+

An ageing population will put pressure on

healthcare services and

labour market over time

Ageing Population

In 2030, E7 will overtake

the G7 in their size

and purchasing power

Hong Kong’s rankingin economic strength

may move down to 69th

for 2025 from 21st for 2015

Greater regional cooperation with

Mainland China

Economic Shift

50% of global GDP is generated by

the 300 largest metropolitan areas

Hong Kong population expected to be 8.22

million in 2044, affect capacity of public

services

Ageing urban system poses

challenges to urban regeneration

Rapid Urbanisation

35% expected increase

in global food demand by 2030

Avg. temperatures expected to rise by over

2°C in the 21st century

Hong Kong’stemperature is expected

to further rise by 1.5-3°C

by the years 2051-2060

Climate & Resource Scarcity

21 technological shifts expected to

take place by 2027

Avg. data breach costs

$3.79M. Total cost of data breaches has incr.

23% since 2013

Rapid increase in mobile penetration rate

to 232.2%, amongst the highest in the world

6.1 mill smartphone users by 2021

Technological Breakthroughs

PwC

People-centric vision and mission statements provides overarching guidance on the development of smart city initiatives

Vision

“Smart Hong Kong - Embracing innovation and technology to build a strong economy, bring quality living and make Hong Kong a well-known Smart City.”

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Mission

PwC

Proposed activities around 6 Smart Themes have been set out in the Development Plans and are now under public consultation

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PwC

The proposed activities have taken into account overseas experience, local urban challenges and current capabilities

• The activities have been organised under the short, medium and long term

• These activities:

Promote the adoption and application of emerging technologies to address urban challenges (e.g., double ageing problems)

Nurture a highly adaptive population that readily embraces changes, innovation and technology

Encourage, build up, and support the talent and resources required to establish for a self-sustainable innovation eco-system

• The adoption of emerging technologies is not an end it itself; it is a means to an end

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Short(2017-2020)

Medium(2021-2025)

Long (2026-2030+)

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Smart Mobility

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• Facilitate commuters’ choice of efficient and integrated multimodal transport, promote non-mechanised transport mode for short trips and maximise use of public transport

• Reduce carbon emission and air pollution through the use of efficient modes of transportation

• Alleviate traffic congestion problems through effective planning and enforcement

• Intelligent Transport Systems

• Smart Public Transport Interchange or Major Bus Stops

• All-in-One Transport Mobile Application (“HKeMobility”):

• Smart Parking

• Intelligent Signalised Junctions and Pedestrian Lights

• Smart Airport

• Connected Vehicles

• Electronic Road Pricing

• Use of Smart Buses

Potential application areas

Objectives

• Use of Autonomous Vehicles

• Promotion of Car Pooling and Sharing

• Bike Facilities

• Installation of In-Vehicle Unit

• Use of Environmentally-Friendly Ferries for Passenger Ferry Services

• Adoption of Smart Technologies in Traffic Enforcement

Smart City

Smart Mobility

PwC

Smart Living

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• Instil and enhance citizens’ confidence and ability in transacting electronically with the public and private sector

• Support general citizen wellbeing

• Empower the elderly to age in their own communities

• Digital Persona

• Digital Payments

• Smart Community Healthcare

• Smart Hospital Services

• Smart Workplace

Potential application areas

Smart City

Objectives

Smart Living

PwC

Smart Environment

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• Promote a more sustainable environment for the people of Hong Kong

• Optimise the use of city resources through “reduce, reuse and recycle”

Climate Action Plan 2030+ • Specifically for Smart Environment, it covers activities such as:

• The expanding of renewable energy such wind or solar in Hong Kong;• The potential use of building management systems (BMS), Combined Cooling,

Heating, Power (CCHP) with energy storage, energy utilisation indexes and benchmarks, remote building audits, green building material and standards, advanced metering infrastructure (AMI), automated space controls for lighting, heating, ventilation and air conditioning (HVAC);

• The adoption of electric vehicles for both public and private transportation sectors and infrastructure expansion of electric vehicle charging facilities; and

• The implementation of “Reduce, Reuse and Recycling” programme, conversation programmes as well as the exploring of new sources of energy such as that from waste in Hong Kong.

In addition to CAP 2030+:• Green and intelligent buildings;• Smart grid;• Intelligent waste management;

Potential application areas

• Pollution management; and• LED lighting

Smart City

Objectives

Smart Environment

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• Enable people to interact with service providers and participate in civil society with ease and confidence

• Facilitate lifelong learning for individuals in the public and private sector about STEM

• Adaptive population that readily embraces changes

• Cultivate Data Science Expertise

• One stop shop

• Use of On-line Applications and Social Media for Stakeholder Engagement

• Technology education

• Education and skill retooling

Potential application areas

Smart City

Objectives

Smart People

PwC

Smart Government

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• Promote a data-driven approach to further promote development of e-government and related public services

• Deploy appropriate infrastructure to support Smart Government

• Facilitate easy access to government services for transacting with the Government

• 5G

• Building Information Modelling (BIM)

• Smart Intelligent and Integrated Poles (Smart Poles)

• Virtual Hong Kong

• Underground Integrated Ducts

• e-Government Services

• Data-analytics-as-a-Service for Government Departments

Potential application areas

Smart City

Objectives

Smart Government

PwC

Smart Economy

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• Improve and promote the overall business climate, the advancement of Fintech and re-industrialisation, and city attractiveness for start-ups and investors

• Attract leading talent and investments globally to increase the city’s economic vibrancy through established smart city brand

• Fintech

• Smart Manufacturing

• Foreign Investments

• Start-up Ecosystem

• Research and Development Platform

• Smart Tourism

Potential application areas

Smart City

Objectives

Smart Economy

PwC

Smart city implementation needs to be underpinned by strong policy mandate and dedicated implementation capabilities

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Overall Governance Structure An indicative structure of SCPO from Draft Blueprint

PwC

The digital framework provides the foundational technical capabilities required to enable various smart city services

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PwC

Open data is an important resource to help stimulate new applications and innovation for improving city services

To continue the implementation and adoption of open data:

Establish governance structure and appoint a central coordination party – e.g., CDO to champion the cause and serve as an evangelist of open data in the community

Conduct current inventory of existing datasets, prioritise their release, and monitor data statistics and feedback to ensure relevance and usefulness

Establish KPIs that can effectively assess open data effectiveness and then market milestones to the community

Improve on Hong Kong’s existing data.gov.hk portal by automating release of datasets and implementing APIs

Establish common practices and formats for data release and usage

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PwC

Ability to balance the need of protecting personal data and effective use of such data is key to smart city implementation

Work jointly with the PCPD to adapt privacy principles based on “Privacy by Design” for smart city capabilities and implement additional measures

Set policies and specify practices around consent, transparency, and de-identification

Consider legislative changes and/or sector-specific industry guidelines/practices

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Privacy concerns

IoT Platform Big Data Open Data

PwC

Smart city calls for close collaboration among the public sector, private sector, academia and citizens

When used effectively, Public-Private Partnerships can provide various benefits:

1. Encouraging private sector to develop and promote innovation in the industry

2. Optimising both public and private sector skill and expertise

3. Encouraging private sector to invest in public sector infrastructure projects and services

4. Facilitating the public sector to focus on project outcomes and benefits from the onset

5. Emphasis on quality in projects

6. Effective risk allocation

7. Helping the public sector pay for services

8. Greater budgetary certainty for the public agency

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PwC

Smart City pilots allow the Government to test innovative solutions in a managed and controlled manner

A list of criteria has been developed to help identify appropriate smart city pilot proposals:

• Can be implemented in a relatively short timeframe

• Are highly relevant to the community

• Bring tangible benefits to the community

• Have the potential for territory-wide implementation

• Are likely to be sustainable in the long term

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PwC

Against the criteria, six pilot areas have been suggested for the consideration of the Government

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Pilot Smart Theme

Smart Public Transport Interchanges/Major Bus Stops

Smart Mobility

Smart Intelligent and Integrated Poles Smart Government

Intelligent Signalised Junctions and Pedestrian Lights Smart Mobility

Smart Parking Smart Mobility

Science Park and The Chinese University of Hong Kong – Smart Region Living Lab for Smart City

Smart People, Smart Living, Smart Mobility, Smart Environment

Cultural and Heritage Tourism in Central District Smart Economy

PwC

An innovation framework should be adopted to facilitate continuous innovations in Hong Kong as a smart city even after initial pilot projects

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PwC

Some challenges that need to be addressed for Hong Kong to realise the potential benefits brought about by smart city

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• Stakeholder engagement

• Data sharing for public and private data

• Privacy

• Commercial considerations

• Standard

• Testing ground – living lab

• Availability of talent

• Coordination between different bureaux and departments

• Procurement approach

PwC

The momentum of Smart City in Hong Kong continues

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• The Consultancy Study serves as a reference for the development of a smart city blueprint for Hong Kong

• The Government will consult stakeholders and various sectors of the community to reach consensus in order to formulate a smart city blueprint that appropriate reflects stakeholder expectations and situation in Hong Kong

• The Government aims to publish the blueprint before the third quarter of 2018

PwC

Public consultation is now underway to help inform the Government on prioritisation of resources – Do Participate!

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The opening period of this public views collection exercise (https://www.smartcity.gov.hk/) will be until September 2017

PwC

Thank you

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This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.

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