Santiago, Chile: Ingredients for a Smart City

By Frank Teng

Frank Teng is a current MBA in Sustainable Management student at Presidio Graduate School in San Francisco and is on the board of Sustainable Silicon Valley. He works with Jones Lang LaSalle, a global real estate services firm, to manage global energy and sustainability programs for corporate clients in the technology and financial services sectors. Please note: Frank's views are his own and do not necessarily reflect the views of his employer.

Santiago, Chile may very well be the smart city of the future.

To start with, 40% of the country lives in Santiago, and 85% of the population lives in urban areas, thus modeling the urbanization trend predicted throughout the rest of the world. Though the country is long (it stretches approximately the distance of Seattle to Mexico City), it only averages 110 miles wide and therefore the population and infrastructure is concentrated along a central corridor, with equal access to the coast as well as the Andes mountain chain. Santiago was named the #1 smart city in Latin America by Fast Company, using climate strategist Boyd Cohen’s Smart Cities Wheel methodology, and I had the fortune to visit recently and see for myself.

Business & Innovation

For one, Santiago reflects many of the sensibilities and policies of the country at large. Chile has ambitious goals; outgoing President Sebastián Piñera set a goal in 2012 to become a developed nation by 2020 (measured by GDP per capita). The country is lauded for its business-friendly policies encouraging deregulation and privatization, stable currency and corruption-free government, and robust infrastructure. These policies benefit businesses both large and small. Though most of the economy is driven by mining, timber, agriculture, and other heavy industries, the country is deliberately diversifying including attracting investments such as a $150 million datacenter from Google that was recently scheduled to open.

It is also investing heavily in innovation; the Start-Up Chile program began in 2010, and offers high potential global start-ups a $40,000 equity-free investment. By the end of its first phase in 2014 it will have provided grants to 1,000 companies for a total of $40 million. The end goal of this accelerator program is to establish Chile as “the definitive innovation and entrepreneurial hub of Latin America.” As a result, Santiago was recently ranked amongst the top 20 in the world for its entrepreneurial ecosystem. With its young, urban population, Santiago seems particularly well-poised culturally to embrace new ideas and technologies hatched by local and foreign innovators.

Energy & Buildings

In late 2012, Chile was ranked among the top 10 countries in the world with the Most Sustainable Buildings, logging 152 construction projects (111 in Santiago) in pursuit of LEED certification. The public consciousness of sustainable practices and support for investments in green infrastructure is high. About one-third of the country’s energy is generated from large hydroelectric dams; however a public outcry was raised when a massive dam project was proposed in the pristine Patagonia region, leading to its effective defeat.

An additional 6% of energy is generated from non-conventional renewables such as wind, solar, and small hydro, which hold great potential in the northern deserts and southern forests. The government is working toward a policy goal of 20% non-conventional renewables by 2025, mainly in response to shortages experienced 8-10 years ago when droughts limited hydropower production and shortages of imported natural gas from Argentina led to blackouts. While there is a full pipeline of utility-scale renewables, there is also strong government focus on encouraging distributed energy and cogeneration, particularly for paper mills, dairy farms, and other industries.

Chile has very high electricity costs, with residents typically paying more than double the rates of average U.S. electricity rates. This is mostly due to the escalating costs of energy generation since Chile imports virtually all of its fossil fuels. Energy ratings on home appliances and wide deployment of LED lights reflect the culture of energy efficiency and conservation.

Mobility

Though it hasn’t solved all issues with congestion, Santiago’s extensive and efficient metro system already has the highest per capita use in South America. The price per Metro ride is based on congestion pricing in a 3-tier system throughout the day, providing choices to local commuters, all supported by a  convenient central card payment platform. The network of buses is ubiquitous, with multiple major competing companies and long-haul bus yards that are very modernized and humming with efficiency, replacing much of the past rail development. Bus stops are numbered in sequence throughout the city and a service provides 2 free daily bus arrival updates via text message. Metro stations have NFC (near-field communication) docks on the walls to tag for latest public service updates.

A flat topography and generally pleasant weather support a strong cycling community. Separated bikeways line more well-traveled corridors, large public bike racks are well situated at most popular destinations, fixed gear bicycles abound, and the city recently kicked off a weekly “ciclorecreovia” event which shuts down long stretches of city streets on Sundays for walking, running, and cycling, much like Bogota’s ciclovia. Mobility for motorized transport isn’t impaired by this event, though, since a large fleet of volunteers helps manage cross-traffic at each intersection. Some communities have implemented bike sharing programs, including a recent collaboration with B-Cycle (a U.S. Company) and Banco Itau.

The largest energy company, Chilectra, is starting a pilot to support an EV car-sharing program, which would be the first of its kind in Latin America. High gasoline costs are as challenging as high electricity prices, so the economics of EV charging will be similar to that in the U.S.

Smart City prototype

A smart city pilot development was approved to move forward in January 2013 in the Huechuraba area of Santiago, and should be finished by now. The model they have created projects the “Santiago of Tomorrow”, seeking to improve quality of life for its inhabitants by increasing access to energy, creating environmentally friendly smart homes, and emphasizing the use of sustainable energy. They revolve around the idea that “smart” inhabitants use their city resources wisely in order to live and grow sustainably. The prototype includes:

  • Implementation of smart homes with domotic systems (electronically-controlled home appliances)
  • Electric public transport: buses and taxis
  • Installation of an “electrolinera” service station with a rapid recharging facility
  • Installation of smart meters with two-way communication.
  • Solar water heating
  • Photovoltaic generation system
  • Electronic information panels at bus stops

People

The culture of Santiago comes off as very open and creative, perhaps in reaction to the 17 years of heavy handed dictatorship under Augusto Pinochet through 1990. Graffiti and murals, community spaces encouraging gathering and public expression, a strong theater culture, and even mimes, jugglers, and brass bands playing at street corners create a sense that you can never really expect what will happen around the corner. A community center I visited had a collection point for people to drop off “ecobricks” made by stuffing repurposed plastic bottles with plastic bags that would be used to construct shelters for the homeless. A long chalkboard wall invited visitors to share their dreams of what “I imagine a Chile” to be.

Between its economy, government, infrastructure, mobility, environment, and people, Santiago seems to be mixing the optimal ingredients for an exemplary smart city of the future. Of course, I couldn’t conclude without mentioning that Chilean wine and beer are not only excellent and affordable, but that wineries seem to take environmental stewardship very seriously as a random sampling of wines all exhibited climate-friendly certifications.

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