Hitachis Vision for Smart Cities

Seeking the Optimal Balance Among People, Places, Prosperity, and the Planet
Hitachi, Ltd.
Inquiries:
Social Innovation Business Project Division Smart City Project Division
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Hitachi, Ltd. 2013. All rights reserved.
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http://www.hitachi.com/products/smartcity/
Ver.2
2013.9
All over the world, concrete steps are being taken to
make a special type of city: a smart city. These cities use
new technologies to help them reach their diverse goals
more efciently. Some cities are being made smarter, and
some new cities are being designed to be smart from
their very beginnings. A common goal is to provide cost-
efcient services to their residents. Another goal is to
make cities that are attractive from a variety of view-
points: for example, to make cities that are both eco-
nomically vibrant and also environmentally friendly. As
environmental and energy problems grow increasingly
severe, and the need for sustainable growth increases,
smart cities are becoming more necessary and more
popular.
In April 2010, Hitachi established an entire division
focused on smart cities. The Social Innovation Business
Project Division (formerly the Smart City Business Man-
agement Division) draws on the experience and expertise
of the companies in the Hitachi group. These companies
have been developing a wide range of social infrastruc-
ture, equipment, and information systems for cities over
many years. The division aims to contribute to smart city
initiatives and work with Japanese and overseas partners
to develop and promote smart-city related businesses.
Through these businesses, Hitachi helps cities plan, imple-
ment, and operate systems that can efciently resolve
current issues. These systems are also designed to help
resolve future issues: for example, by using modular
designs to ensure easy replacement of parts, and by provid-
ing data to identify and resolve future problems. With
Hitachi's help, smart cities can effectively implement
disaster-resilient systems.
Hitachis visionary approach, however, is not just to help
make technologically advanced cities. Narrow technologi-
cal solutions seldom satisfy all of a citys stakeholders,
which include city administrators, residents, businesses,
and those generating or reecting world opinion on the
environment. A citys stakeholders often have different
goals and focus on different issues. Hitachi's approach is to
nd solutions that provide the optimal balance among all
these stakeholders. Hitachi rst takes into account the eco-
nomic, environmental, and social issues that a city con-
fronts, and then helps to provide smart-city solutions that
help resolve the issues specic to that city. The resulting
systems not only resolve current issues, but also make it
easier to resolve future issues.
Seeking the optimal balance among people, places, prosperity, and the planet
Prologue
2
4-1 Disassembling and reassembling the daily-life services infrastructure
4-2 Anticipated benets of disassembly and reassembly
4-3 New ways of life made possible by disassembly and reassembly
3-1 Hitachis capabilities
Column: The drive for collaboration in projects
3-2 Management framework
3-3 Use of indicators for urban operations
3-4 Design framework
3-5 Smart city administrators
3-6 Case study: Kashiwa-no-Ha Smart City Project
2-1 Smart city stakeholders
2-2 Optimal balance among people, places, prosperity, and the planet
2-3 Structure of a smart city
2-4 Smart-city management infrastructure
[1] Advanced IT and autonomous decentralized systems for the social infrastructure
[2] Advanced controls for balancing supply and demand
[3] Integrated services delivered in optimal combinations
[4] Creation of new services through innovation
2-5 Smart city requirements
[1] What it takes to be a smart city
[2] Step-by-step objectives of a smart city
[3] Economic growth of a smart city
1-1 The need to handle global environment and urbanization problems
1-2 The need to accommodate changing lifestyles
1-3 The need for a long-term approach to developing sustainable cities
5-1 Smart city development requires partners
5-2 Clarifying directions is crucial
Contents
Why Smart Cities Are Needed Now
Chapter
1
Hitachis Vision for Smart Cities
Chapter
2
Making Smart Cities
Chapter
3
Smart City, Smart Life
Chapter
4
Ever-Evolving Smart Cities
Chapter
5
All over the world, concrete steps are being taken to
make a special type of city: a smart city. These cities use
new technologies to help them reach their diverse goals
more efciently. Some cities are being made smarter, and
some new cities are being designed to be smart from
their very beginnings. A common goal is to provide cost-
efcient services to their residents. Another goal is to
make cities that are attractive from a variety of view-
points: for example, to make cities that are both eco-
nomically vibrant and also environmentally friendly. As
environmental and energy problems grow increasingly
severe, and the need for sustainable growth increases,
smart cities are becoming more necessary and more
popular.
In April 2010, Hitachi established an entire division
focused on smart cities. The Social Innovation Business
Project Division (formerly the Smart City Business Man-
agement Division) draws on the experience and expertise
of the companies in the Hitachi group. These companies
have been developing a wide range of social infrastruc-
ture, equipment, and information systems for cities over
many years. The division aims to contribute to smart city
initiatives and work with Japanese and overseas partners
to develop and promote smart-city related businesses.
Through these businesses, Hitachi helps cities plan, imple-
ment, and operate systems that can efciently resolve
current issues. These systems are also designed to help
resolve future issues: for example, by using modular
designs to ensure easy replacement of parts, and by provid-
ing data to identify and resolve future problems. With
Hitachi's help, smart cities can effectively implement
disaster-resilient systems.
Hitachis visionary approach, however, is not just to help
make technologically advanced cities. Narrow technologi-
cal solutions seldom satisfy all of a citys stakeholders,
which include city administrators, residents, businesses,
and those generating or reecting world opinion on the
environment. A citys stakeholders often have different
goals and focus on different issues. Hitachi's approach is to
nd solutions that provide the optimal balance among all
these stakeholders. Hitachi rst takes into account the eco-
nomic, environmental, and social issues that a city con-
fronts, and then helps to provide smart-city solutions that
help resolve the issues specic to that city. The resulting
systems not only resolve current issues, but also make it
easier to resolve future issues.
Seeking the optimal balance among people, places, prosperity, and the planet
Prologue
2
4-1 Disassembling and reassembling the daily-life services infrastructure
4-2 Anticipated benets of disassembly and reassembly
4-3 New ways of life made possible by disassembly and reassembly
3-1 Hitachis capabilities
Column: The drive for collaboration in projects
3-2 Management framework
3-3 Use of indicators for urban operations
3-4 Design framework
3-5 Smart city administrators
3-6 Case study: Kashiwa-no-Ha Smart City Project
2-1 Smart city stakeholders
2-2 Optimal balance among people, places, prosperity, and the planet
2-3 Structure of a smart city
2-4 Smart-city management infrastructure
[1] Advanced IT and autonomous decentralized systems for the social infrastructure
[2] Advanced controls for balancing supply and demand
[3] Integrated services delivered in optimal combinations
[4] Creation of new services through innovation
2-5 Smart city requirements
[1] What it takes to be a smart city
[2] Step-by-step objectives of a smart city
[3] Economic growth of a smart city
1-1 The need to handle global environment and urbanization problems
1-2 The need to accommodate changing lifestyles
1-3 The need for a long-term approach to developing sustainable cities
5-1 Smart city development requires partners
5-2 Clarifying directions is crucial
Contents
Why Smart Cities Are Needed Now
Chapter
1
Hitachis Vision for Smart Cities
Chapter
2
Making Smart Cities
Chapter
3
Smart City, Smart Life
Chapter
4
Ever-Evolving Smart Cities
Chapter
5
3
A smart city maximizes benets to city administrators
and residents while minimizing adverse affects on
the environment and economy. The momentum for
smart cities is increasing in both developed and
developing countries as more and more people real-
ize the advantages and lifestyles that a smart city can
provide. A smart city supports lifestyles that are
urban and enjoyable, but also provides efcient sup-
port for disaster resilience and environmentally
friendly, sustainable economic growth.
In many countries, smart cities are needed to handle
undesired changes in the environment and to avoid
or lessen the adverse effects of uncontrolled urban-
ization. This section describes some of these changes
and adverse affects.
1-1 The need to handle global environment
and urbanization problems
Why Smart Cities Are
Needed Now
Chapter
1
4
[1] Global warming and climate change
Governments, researchers, and businesses have
started focusing considerable attention on the causes
and effects of global warming and associated climate
changes. Climate changes obviously impact ecosys-
tems; however, they also result in major risks to all
societies. These risks include secondary damage, such
as the impact of severe weather events and natural
disasters on economic activity. As an example, when
Hurricane Sandy struck the USA in 2012, the resulting
economic losses were so large that they actually had
an identiable impact on the nances of the USA
itself.
Global warming is expected to produce an increase in
sea surface temperatures which, in turn, is expected
to increase the frequency and severity of hurricanes.
Global warming and climate changes are closely
linked to the emission of greenhouse gases such as
carbon dioxide and methane, which are often pro-
duced by industrial activities. To minimize and miti-
gate global warming, many government and private
groups are working on measures to reduce green-
house gas emissions. These measures include steps
toward establishing a new global framework for
emissions reductions.
[2] Population increase and resource depletion
A combination of economic progress and rapid popu-
lation increase results in faster consumption of
resources which, in turn, results in resource depletion
and increases in prices of the scarce resources. This
problem increases as populations increase. According
to the United Nations Population Fund, the worlds
population increased 2.8 times from 1950 (2.5 billion
people) to 2011 (7 billion people). The population is
expected to reach 9.3 billion in 2050.
[3] Adverse effects of increasing urbanization
Urbanization is increasing very rapidly. The United
Nations estimates that in 2020 the urban population
of emerging economies will surpass the rural popula-
tion, and in 2050 around 70% of the worlds popula-
tion will live in cities (see Fig. 1.1).
As urbanization increases, adverse effects also
increase. Swelling populations will only exacerbate
the numerous problems in urban areas. Problems
include slums, air pollution, water shortages, energy
shortages, trafc congestion, inadequate capacity for
treating waste water and sewage, and inadequate
capacity for disposing of urban and industrial waste.
In addition, developed economies are encountering
new issues: such as the need to make cities more
compact as lower birthrates and aging populations
result in fewer people, and the need to provide mo-
bility options for older residents.
Chapter 1
1950: 2.5 billion 1987: 5.0 billion 1999: 6.0 billion 2011: 7.0 billion 2050: 9.3 billion
Population
(100 million)
(Year)
Fig. 1.1: Trends in urban and rural populations
(Source: World Urbanization Prospects, the 2011 Revision, United Nations)
Urban population in
emerging economies
Rural population in
emerging economies
Urban population in
developed economies
Rural population in
developed economies
3
A smart city maximizes benets to city administrators
and residents while minimizing adverse affects on
the environment and economy. The momentum for
smart cities is increasing in both developed and
developing countries as more and more people real-
ize the advantages and lifestyles that a smart city can
provide. A smart city supports lifestyles that are
urban and enjoyable, but also provides efcient sup-
port for disaster resilience and environmentally
friendly, sustainable economic growth.
In many countries, smart cities are needed to handle
undesired changes in the environment and to avoid
or lessen the adverse effects of uncontrolled urban-
ization. This section describes some of these changes
and adverse affects.
1-1 The need to handle global environment
and urbanization problems
Why Smart Cities Are
Needed Now
Chapter
1
4
[1] Global warming and climate change
Governments, researchers, and businesses have
started focusing considerable attention on the causes
and effects of global warming and associated climate
changes. Climate changes obviously impact ecosys-
tems; however, they also result in major risks to all
societies. These risks include secondary damage, such
as the impact of severe weather events and natural
disasters on economic activity. As an example, when
Hurricane Sandy struck the USA in 2012, the resulting
economic losses were so large that they actually had
an identiable impact on the nances of the USA
itself.
Global warming is expected to produce an increase in
sea surface temperatures which, in turn, is expected
to increase the frequency and severity of hurricanes.
Global warming and climate changes are closely
linked to the emission of greenhouse gases such as
carbon dioxide and methane, which are often pro-
duced by industrial activities. To minimize and miti-
gate global warming, many government and private
groups are working on measures to reduce green-
house gas emissions. These measures include steps
toward establishing a new global framework for
emissions reductions.
[2] Population increase and resource depletion
A combination of economic progress and rapid popu-
lation increase results in faster consumption of
resources which, in turn, results in resource depletion
and increases in prices of the scarce resources. This
problem increases as populations increase. According
to the United Nations Population Fund, the worlds
population increased 2.8 times from 1950 (2.5 billion
people) to 2011 (7 billion people). The population is
expected to reach 9.3 billion in 2050.
[3] Adverse effects of increasing urbanization
Urbanization is increasing very rapidly. The United
Nations estimates that in 2020 the urban population
of emerging economies will surpass the rural popula-
tion, and in 2050 around 70% of the worlds popula-
tion will live in cities (see Fig. 1.1).
As urbanization increases, adverse effects also
increase. Swelling populations will only exacerbate
the numerous problems in urban areas. Problems
include slums, air pollution, water shortages, energy
shortages, trafc congestion, inadequate capacity for
treating waste water and sewage, and inadequate
capacity for disposing of urban and industrial waste.
In addition, developed economies are encountering
new issues: such as the need to make cities more
compact as lower birthrates and aging populations
result in fewer people, and the need to provide mo-
bility options for older residents.
Chapter 1
1950: 2.5 billion 1987: 5.0 billion 1999: 6.0 billion 2011: 7.0 billion 2050: 9.3 billion
Population
(100 million)
(Year)
Fig. 1.1: Trends in urban and rural populations
(Source: World Urbanization Prospects, the 2011 Revision, United Nations)
Urban population in
emerging economies
Rural population in
emerging economies
Urban population in
developed economies
Rural population in
developed economies
Why Smart Cities Are Needed Now
5
Smart cities are also needed to handle the ongoing
shifts in the lifestyle values of residents. This section
describes some related aspects.
[1] Valuing usage above ownership
An interesting trend is the development of sharing
and renting arrangements that enable people to
achieve the benets of ownership without the demer-
its. A typical example is the increase in the sharing or
renting of motor vehicles, which allows users to use a
vehicle whenever and wherever one is required.
Three specic factors are inuencing this trend from
ownership to sharing or renting. The rst is that the
nature of what is being offered to residents is
expanding from products to services. The second is
the realization that a sharing or renting arrangement
is preferable in many situations, based on an exami-
nation of the costs of purchasing and maintaining a
product, and the impact of continued ownership on
the environment. The third is that the ownership of
material products brings with it the need for their
maintenance and upkeep, whereas sharing or renting
arrangements can free people from these obligations
while still ensuring that the benets of using the
products are available whenever the user wants
them.
In the near future, smart cities should take these fac-
tors into account and help provide new systems and
services to match this trend.
[2] Focusing on non-monetary values
The way people think about payment for services is
also changing and, in certain situations, exchanging
services for non-monetary returns (including the
satisfaction from helping others) is preferred. For
example, an increasing number of people use the
Internet to nd people or places where their skills are
needed, but where the recipients do not have the
ability to pay market rates for the provided services.
The givers do not exchange their expertise or other
skill for money, but rather to satisfy personal values
such as their wish to help people. Voluntary work is
common, and it is anticipated that this trend will
grow. The Internet offers expanded opportunities for
using ones knowledge or specialist skills to help
other people.
Of course, the systems that enable satisfaction of
non-monetary values need to work with economic
and monetary systems. This greater diversity in how
value is exchanged is likely to give rise to numerous
activities that did not exist in the economic systems
of the past. Such activities will be characterized by a
high degree of freedom and exibility.
In the future, smart cities must continue to provide
marketplaces in which money can be used for the
exchange of value, but should also provide mecha-
nisms and infrastructure to allow other complex and
diverse forms of value exchange to occur smoothly.
1-2 The need to accommodate changing
lifestyles
6
[3] Having wider opportunities for work and study
Technology is making it possible to expand opportu-
nities for work and study just as the demand for such
opportunities is increasing. For example, the Internet
is expanding opportunities for online learning and
for delivery of ofine-learning materials. This is
making it possible for everyone, from children to the
elderly, to study when and where they want.
Expanded opportunities are particularly important in
Japan, which will be one of the rst countries in the
world to face the challenge of an aging population.
By 2025, it is estimated that one in three people in
Japan will be 65 or older. Japans challenge is to pro-
vide an environment in which more elderly people
can utilize their skills and knowledge in employment.
This will help mitigate the problem of a shrinking
working population and reduce the burden on the
young and middle-aged.
Smart cities will need to increasingly expand the
number and diversity of opportunities for work and
study.
[4] Overcoming restrictions of time and place
New technologies are providing new services regard-
less of time or place. For example, broadband access
and smartphones can give people access to a wide
variety of services from any location at any time.
Similarly, video streaming services and advances in
recording functions allow viewers to watch video or
TV content whenever they want, and do not require
viewers to be present at specic times. Such technolo-
gies are a boon for busy people struggling with full
schedules.
Meanwhile, the ability to work outside the ofce is
creating new ways of working that are not restricted
to particular times and places. This can improve both
productivity and the work-life balance.
These technologies and associated trends allow
people to obtain what they want, at any desired loca-
tion or time.
Smart cities will need to ensure access to these tech-
nologies and the new services they provide.
[5] Being both a consumer and a producer
Formerly, consumers of a product were seldom pro-
ducers of that product. Recently, however, a new
bidirectionality has emerged whereby the same
person or group can be both a consumer and a pro-
ducer. For example, many sites on the Internet allow
participants to view information uploaded by others
and also to upload information to be viewed by
others. As another example, in the energy eld,
people who install their own solar power generator
can act as both a user and a supplier.
Thi s bi di recti onal i ty requi res communi cati on
between the parties involved and an awareness of
each others circumstances. Future urban operations
will no longer be able to assume a unidirectional
relationship with the consumer.
Smart cities will need to ensure that such bidirec-
tional communication is available in a variety of
forms, both automated and otherwise.
Chapter
1
Why Smart Cities Are Needed Now
5
Smart cities are also needed to handle the ongoing
shifts in the lifestyle values of residents. This section
describes some related aspects.
[1] Valuing usage above ownership
An interesting trend is the development of sharing
and renting arrangements that enable people to
achieve the benets of ownership without the demer-
its. A typical example is the increase in the sharing or
renting of motor vehicles, which allows users to use a
vehicle whenever and wherever one is required.
Three specic factors are inuencing this trend from
ownership to sharing or renting. The rst is that the
nature of what is being offered to residents is
expanding from products to services. The second is
the realization that a sharing or renting arrangement
is preferable in many situations, based on an exami-
nation of the costs of purchasing and maintaining a
product, and the impact of continued ownership on
the environment. The third is that the ownership of
material products brings with it the need for their
maintenance and upkeep, whereas sharing or renting
arrangements can free people from these obligations
while still ensuring that the benets of using the
products are available whenever the user wants
them.
In the near future, smart cities should take these fac-
tors into account and help provide new systems and
services to match this trend.
[2] Focusing on non-monetary values
The way people think about payment for services is
also changing and, in certain situations, exchanging
services for non-monetary returns (including the
satisfaction from helping others) is preferred. For
example, an increasing number of people use the
Internet to nd people or places where their skills are
needed, but where the recipients do not have the
ability to pay market rates for the provided services.
The givers do not exchange their expertise or other
skill for money, but rather to satisfy personal values
such as their wish to help people. Voluntary work is
common, and it is anticipated that this trend will
grow. The Internet offers expanded opportunities for
using ones knowledge or specialist skills to help
other people.
Of course, the systems that enable satisfaction of
non-monetary values need to work with economic
and monetary systems. This greater diversity in how
value is exchanged is likely to give rise to numerous
activities that did not exist in the economic systems
of the past. Such activities will be characterized by a
high degree of freedom and exibility.
In the future, smart cities must continue to provide
marketplaces in which money can be used for the
exchange of value, but should also provide mecha-
nisms and infrastructure to allow other complex and
diverse forms of value exchange to occur smoothly.
1-2 The need to accommodate changing
lifestyles
6
[3] Having wider opportunities for work and study
Technology is making it possible to expand opportu-
nities for work and study just as the demand for such
opportunities is increasing. For example, the Internet
is expanding opportunities for online learning and
for delivery of ofine-learning materials. This is
making it possible for everyone, from children to the
elderly, to study when and where they want.
Expanded opportunities are particularly important in
Japan, which will be one of the rst countries in the
world to face the challenge of an aging population.
By 2025, it is estimated that one in three people in
Japan will be 65 or older. Japans challenge is to pro-
vide an environment in which more elderly people
can utilize their skills and knowledge in employment.
This will help mitigate the problem of a shrinking
working population and reduce the burden on the
young and middle-aged.
Smart cities will need to increasingly expand the
number and diversity of opportunities for work and
study.
[4] Overcoming restrictions of time and place
New technologies are providing new services regard-
less of time or place. For example, broadband access
and smartphones can give people access to a wide
variety of services from any location at any time.
Similarly, video streaming services and advances in
recording functions allow viewers to watch video or
TV content whenever they want, and do not require
viewers to be present at specic times. Such technolo-
gies are a boon for busy people struggling with full
schedules.
Meanwhile, the ability to work outside the ofce is
creating new ways of working that are not restricted
to particular times and places. This can improve both
productivity and the work-life balance.
These technologies and associated trends allow
people to obtain what they want, at any desired loca-
tion or time.
Smart cities will need to ensure access to these tech-
nologies and the new services they provide.
[5] Being both a consumer and a producer
Formerly, consumers of a product were seldom pro-
ducers of that product. Recently, however, a new
bidirectionality has emerged whereby the same
person or group can be both a consumer and a pro-
ducer. For example, many sites on the Internet allow
participants to view information uploaded by others
and also to upload information to be viewed by
others. As another example, in the energy eld,
people who install their own solar power generator
can act as both a user and a supplier.
Thi s bi di recti onal i ty requi res communi cati on
between the parties involved and an awareness of
each others circumstances. Future urban operations
will no longer be able to assume a unidirectional
relationship with the consumer.
Smart cities will need to ensure that such bidirec-
tional communication is available in a variety of
forms, both automated and otherwise.
Chapter
1
City competitiveness
Growth phase
Mature phase
Transformation phase
Time
City that takes a conventional
approach
(Ongoing decline)
Smart city
(Sustainable development)
Measures to make the city more attractive
Repair and replace infrastructure
Early phase
0
5
10
15
20
(Fiscal year)
-5
(Trillion yen)
Note: Methods used to produce estimates
The following assumptions were made for the 2011 scal year onwards for
activities administered by the eight divisions (roads, ports, airports, public
housing, sewage, urban parks, catchment management, and coastlines) of the
Ministry of Land, Infrastructure, Transport and Tourism and also for the
activities they subsidize, and for self-funded activities of regional governments.
The expenditure on upgrades assumes that, on reaching the end of its
operational life, a facility will be upgraded to provide its original functions, with
the cost being determined based on the cost of the original construction
adjusted in accordance with the practical considerations of an actual upgrade.
The values used for operational life spans are based on life spans specied by
the Ministry of Finance for taxation purposes, adjusted in accordance with
practical considerations for the particular facility being upgraded.
The expenditure on maintenance is estimated based on correlation with the
value of social capital stock. (The estimated expenditures on upgrading and
maintenance take account of the actual results of recent cost cutting measures.)
The expenditure on disaster recovery is the average of past annual expendi-
tures.
The expenditure on new construction (funds available for appropriation) was
obtained by subtracting expenditures on maintenance, upgrading, and disaster
recovery from the total investment, and does not represent the demand for new
construction.
Land and compensation costs are not included. Independent administrative
agencies such as public corporations for highways are not included.
Note that the estimates are likely to vary based on factors such as future
budgetary changes or the accumulation of technical expertise.
1965 70 75 80 85 90 95 2000 05 10 15 20 25 30 35 40 45 50 55 60
Expenditure on new construction (funds available for
appropriation)
Expenditure on disaster recovery
Expenditure on upgrades
Expenditure on maintenance
Amount by which maintenance and upgrades exceeds
the total 2010 expenditure on investment
Fig. 1.3: Estimates of social capital assuming continuation of current practices for maintenance and upgrading
Assuming that, from 2010 onwards, there is no further growth in total investment, and assuming that expenditure on maintenance and upgrading continues as before,
the cost of maintenance and upgrading will exceed the total investment in 2037. (Source: Japans Ministry of Land, Infrastructure, Transport and Tourism White Paper, 2012)
Fig. 1.2: City lifecycle and competitiveness
Why Smart Cities Are Needed Now
7
The third reason why smart cities are needed is that
cities are always evolving. Only a smart city is
designed to ensure the exible, dynamic approach
needed to ensure the sustainable existence of the
city.
Different cities have different needs. Some cities are
in a growth phase and require ongoing expansion
and new infrastructure, which many cities struggle to
achieve. Other cities have reached a stage of maturity
in which aging infrastructure requires repairs and
upgrades, and where high value-added services need
to be provided to residents. These differences make it
important to look at cities in terms of their lifecycles,
and to manage urban development appropriately by
taking a long-term approach.
[1] Managing the lifecycles of cities
Cities evolve, with different circumstances and
requirements in each phase of their development.
Some infrastructure requirements at different phases
are as follows:
Early phase: Provide the infrastructure needed for
the operation of the city.
Growth phase: Expand and intensify the infra-
structure to ensure that supply can keep pace with
the increasing demands of the growing population.
Mature phase: Enhance infrastructure to ensure
the delivery of high-quality services based on criteria
such as ease-of-use and comfort.
Transformation phase: Integrate infrastructure
systems to satisfy social values such as aiding, or at
least avoiding damage to, the natural environment.
In the early and growth phases, it is important to pro-
vide infrastructure capable of meeting the rising
demand for basic services, such as electric power and
water, that support minimum living standards. How-
ever, once a city enters the mature or transformation
phases, the infrastructure will start to deteriorate
unless something more is done. In these later phases,
in addition to repairing the aging infrastructure, the
city needs to focus on generating new added value,
boosting competitiveness, and strengthening the
economy (see Fig. 1.2).
[2] Improving economic performance over the entire
lifecycle
In development planning, cities need to focus on how
circumstances will change over the long term. Focus-
ing just on resolving the immediate issues of one life-
cycle phase can result in extra burdens on later gen-
erations in later phases.
For example, short-term pursuit of economic growth
has often led to problems, such as pollution, that are
very expensive to clean up later. Similarly, the hasty
1-3 The need for a long-term approach to
developing sustainable cities
8
provision of housing and other infrastructure to cope
with a rapidly growing city has resulted, several
decades later, in problems such as a skewed genera-
tional balance, a loss of vitality, and nancial pres-
sures caused by a bulge in the cost of maintaining
and upgrading the now aging infrastructure.
As with so many situations, prevention is better than
cure. Attempting to deal with full-blown urban prob-
lems is almost always more expensive that the careful
planning that would have prevented such problems
from occurring. The costs of a cure can be very high.
For example, in many developed economies, expen-
ditures on maintenance and repairs are likely to out-
weigh expenditures on new development (see Fig.
1.3).
Accordingly, to achieve sustainable cities, there is a
need to anticipate and identify the underlying causes
of potential problems, and to mitigate the risks by
measures such as upgrading infrastructure and nan-
cial planning.
[3] Enhancing city competitiveness
Cities need to boost their competitiveness and appeal
relative to other cities. In addition to retaining their
residents and businesses, cities need to make them-
selves attractive to newcomers. This has become
more important because people can now choose
where they want to live. In his book Whos Your
City?: How the Creative Economy Is Making Where to
Live the Most Important Decision of Your Life, Rich-
ard Florida of the University of Toronto wrote, Still,
the miracle of our modern age is that we do have a
choice. For the rst time ever, a huge number of us
have the freedom and economic means to choose
our place. The place we choose to live affects every
aspect of our being. It can determine the income we
earn, the people we meet, the friends we make, the
partners we choose, and the options available to our
children and families. People are not equally happy
everywhere.
Enhancing a citys competitiveness requires a multi-
faceted approach to achieve qualitative improve-
ments in society, the economy, and the environment.
Goals include ensuring a rich cultural and economic
environment and ensuring that residents can achieve
long and healthy lives, a harmonious coexistence
with the environment, and safety and security. City
administrators cannot achieve these goals on their
own. Hitachi believes that an effective approach is to
pursue a variety of measures that cover systems,
management, and technology. The result is a com-
prehensive range of hard and soft features. We need
an approach that works from both supply and
demand, and enables the active participation of resi-
dents and encourages changes in behavior.
The next chapter looks at Hitachis vision for smart
cities.
Chapter
1
City competitiveness
Growth phase
Mature phase
Transformation phase
Time
City that takes a conventional
approach
(Ongoing decline)
Smart city
(Sustainable development)
Measures to make the city more attractive
Repair and replace infrastructure
Early phase
0
5
10
15
20
(Fiscal year)
-5
(Trillion yen)
Note: Methods used to produce estimates
The following assumptions were made for the 2011 scal year onwards for
activities administered by the eight divisions (roads, ports, airports, public
housing, sewage, urban parks, catchment management, and coastlines) of the
Ministry of Land, Infrastructure, Transport and Tourism and also for the
activities they subsidize, and for self-funded activities of regional governments.
The expenditure on upgrades assumes that, on reaching the end of its
operational life, a facility will be upgraded to provide its original functions, with
the cost being determined based on the cost of the original construction
adjusted in accordance with the practical considerations of an actual upgrade.
The values used for operational life spans are based on life spans specied by
the Ministry of Finance for taxation purposes, adjusted in accordance with
practical considerations for the particular facility being upgraded.
The expenditure on maintenance is estimated based on correlation with the
value of social capital stock. (The estimated expenditures on upgrading and
maintenance take account of the actual results of recent cost cutting measures.)
The expenditure on disaster recovery is the average of past annual expendi-
tures.
The expenditure on new construction (funds available for appropriation) was
obtained by subtracting expenditures on maintenance, upgrading, and disaster
recovery from the total investment, and does not represent the demand for new
construction.
Land and compensation costs are not included. Independent administrative
agencies such as public corporations for highways are not included.
Note that the estimates are likely to vary based on factors such as future
budgetary changes or the accumulation of technical expertise.
1965 70 75 80 85 90 95 2000 05 10 15 20 25 30 35 40 45 50 55 60
Expenditure on new construction (funds available for
appropriation)
Expenditure on disaster recovery
Expenditure on upgrades
Expenditure on maintenance
Amount by which maintenance and upgrades exceeds
the total 2010 expenditure on investment
Fig. 1.3: Estimates of social capital assuming continuation of current practices for maintenance and upgrading
Assuming that, from 2010 onwards, there is no further growth in total investment, and assuming that expenditure on maintenance and upgrading continues as before,
the cost of maintenance and upgrading will exceed the total investment in 2037. (Source: Japans Ministry of Land, Infrastructure, Transport and Tourism White Paper, 2012)
Fig. 1.2: City lifecycle and competitiveness
Why Smart Cities Are Needed Now
7
The third reason why smart cities are needed is that
cities are always evolving. Only a smart city is
designed to ensure the exible, dynamic approach
needed to ensure the sustainable existence of the
city.
Different cities have different needs. Some cities are
in a growth phase and require ongoing expansion
and new infrastructure, which many cities struggle to
achieve. Other cities have reached a stage of maturity
in which aging infrastructure requires repairs and
upgrades, and where high value-added services need
to be provided to residents. These differences make it
important to look at cities in terms of their lifecycles,
and to manage urban development appropriately by
taking a long-term approach.
[1] Managing the lifecycles of cities
Cities evolve, with different circumstances and
requirements in each phase of their development.
Some infrastructure requirements at different phases
are as follows:
Early phase: Provide the infrastructure needed for
the operation of the city.
Growth phase: Expand and intensify the infra-
structure to ensure that supply can keep pace with
the increasing demands of the growing population.
Mature phase: Enhance infrastructure to ensure
the delivery of high-quality services based on criteria
such as ease-of-use and comfort.
Transformation phase: Integrate infrastructure
systems to satisfy social values such as aiding, or at
least avoiding damage to, the natural environment.
In the early and growth phases, it is important to pro-
vide infrastructure capable of meeting the rising
demand for basic services, such as electric power and
water, that support minimum living standards. How-
ever, once a city enters the mature or transformation
phases, the infrastructure will start to deteriorate
unless something more is done. In these later phases,
in addition to repairing the aging infrastructure, the
city needs to focus on generating new added value,
boosting competitiveness, and strengthening the
economy (see Fig. 1.2).
[2] Improving economic performance over the entire
lifecycle
In development planning, cities need to focus on how
circumstances will change over the long term. Focus-
ing just on resolving the immediate issues of one life-
cycle phase can result in extra burdens on later gen-
erations in later phases.
For example, short-term pursuit of economic growth
has often led to problems, such as pollution, that are
very expensive to clean up later. Similarly, the hasty
1-3 The need for a long-term approach to
developing sustainable cities
8
provision of housing and other infrastructure to cope
with a rapidly growing city has resulted, several
decades later, in problems such as a skewed genera-
tional balance, a loss of vitality, and nancial pres-
sures caused by a bulge in the cost of maintaining
and upgrading the now aging infrastructure.
As with so many situations, prevention is better than
cure. Attempting to deal with full-blown urban prob-
lems is almost always more expensive that the careful
planning that would have prevented such problems
from occurring. The costs of a cure can be very high.
For example, in many developed economies, expen-
ditures on maintenance and repairs are likely to out-
weigh expenditures on new development (see Fig.
1.3).
Accordingly, to achieve sustainable cities, there is a
need to anticipate and identify the underlying causes
of potential problems, and to mitigate the risks by
measures such as upgrading infrastructure and nan-
cial planning.
[3] Enhancing city competitiveness
Cities need to boost their competitiveness and appeal
relative to other cities. In addition to retaining their
residents and businesses, cities need to make them-
selves attractive to newcomers. This has become
more important because people can now choose
where they want to live. In his book Whos Your
City?: How the Creative Economy Is Making Where to
Live the Most Important Decision of Your Life, Rich-
ard Florida of the University of Toronto wrote, Still,
the miracle of our modern age is that we do have a
choice. For the rst time ever, a huge number of us
have the freedom and economic means to choose
our place. The place we choose to live affects every
aspect of our being. It can determine the income we
earn, the people we meet, the friends we make, the
partners we choose, and the options available to our
children and families. People are not equally happy
everywhere.
Enhancing a citys competitiveness requires a multi-
faceted approach to achieve qualitative improve-
ments in society, the economy, and the environment.
Goals include ensuring a rich cultural and economic
environment and ensuring that residents can achieve
long and healthy lives, a harmonious coexistence
with the environment, and safety and security. City
administrators cannot achieve these goals on their
own. Hitachi believes that an effective approach is to
pursue a variety of measures that cover systems,
management, and technology. The result is a com-
prehensive range of hard and soft features. We need
an approach that works from both supply and
demand, and enables the active participation of resi-
dents and encourages changes in behavior.
The next chapter looks at Hitachis vision for smart
cities.
Chapter
1
Smart city
concept
World opinion
on the environment
Residents
City administrators
and developers
Fig. 2.2: Optimal balance among people, places, prosperity, and the planet
Ecology
Contribution to
global environment
Experience
Prosperous urban lifestyles
offering a good quality
of life
Establish a well-balanced harmony between the environment
(with goals such as reducing the burden on the environment)
and residents experiences (with goals such as improving
convenience, safety, prosperity, and the quality of life)
2-2 Optimal balance among people, places,
prosperity, and the planet
9
Hitachis Vision
for Smart Cities
Chapter
2
Hitachi sees its smart city approach as the best way to
resolve the problems faced by individual cities. The
approach takes into account both the economy and
the environment, can handle changing times and
social trends, and supports safe, interesting, and
prosperous lifestyles.
For this approach to work, we rst need to identify
the stakeholders and the structures and organizations
that make up a smart city, and to understand their
different points of view. Hitachi views the smart city
as having a hierarchical structure comprising a vari-
ety of infrastructure with different functions and
roles, and believes that, if each layer of this infra-
structure hierarchy is highly integrated, the city can
resolve problems and provide services more ef-
ciently and more effectively.
Smart city stakeholders include city administrators,
developers, residents, and groups sharing world
opinion on the environment. Such stakeholders have
different interests and interact with the city in
different ways, and stakeholders need to recognize
the existence of standpoints that might differ from
their own. For example, residents need to be aware
that people living well beyond the city borders might
be very concerned at the environmental problems of
the city. Similarly, when developing smart city
concepts and plans, city administrators need to take
into account the needs and concerns of residents and
other parties involved.
2-1 Smart city stakeholders
10
[1] Residents
This group represents the people who are active
within a city: living, working, learning, or traveling.
They are seeking to fulll their own needs, and to
achieve a better quality of life that is comfortable,
prosperous, convenient, interesting, and safe.
[2] City administrators and developers
City administrators include the local government and
other agencies that seek to boost the long-term com-
petitiveness and appeal of the city while focusing on
factors such as convenience, comfort, and accessibil-
ity. They include the agencies involved in managing
the city, but also need to keep in mind the achieve-
ment of national or international targets such as
those for reducing carbon emissions. City administra-
tors emphasize aspects like industrial vitality, achiev-
ing a cohesive society, and efcient urban operation.
Developers have objectives that include achieving
higher efciency and attracting people to the city,
which they achieve by adding value and working with
policies set by the local government. Developers
include people and groups engaged in the planning,
coordination, and construction of the urban environ-
ments that support the activities of residents. They
emphasize aspects like efcient urban development
and increasing added value.
[3] World opinion
Those sharing world opinion on the environment
include groups that desire to help protect the local,
national, and international environments. These
groups are often focused on goals such as maintain-
ing biodiversity, reducing carbon emissions, making
effective use of natural resources, and preventing
global warming.
The conicting standpoints and interests of these
different stakeholder groups mean their needs will
not necessarily coincide. For example, to reduce traf-
c congestion and local pollution, city administrators,
developers, and world opinion on the environment
might want to restrict access to the central city to EVs
(electric vehicles) only. They might also want to
implement systems for sharing EVs and for providing
charging stations at commercial facilities to attract
users and stimulate the local economy. However,
residents might oppose such policies because they
would no longer have the convenient option of driv-
ing their gasoline-powered cars into the city.
Making a smart city (or making a city smarter)
requires a balance among the diverse needs of differ-
ent stakeholders (see Fig. 2.1).
Hitachi believes that the best approach to develop
smart cities is to take all the stakeholder viewpoints
into account. For example to make a city smarter
requires examination of ecological, economic, and
people-oriented factors. But implementing these
insights is not the end of the process. Making a city
smarter provides the tools and systems to efciently
resolve a wide variety of problems in the future.
Smart cities considered desirable by all stakeholders
need to have the optimal balance between the eco-
logical (Eco) needs of the global environment and
the experiential values of the city residents who want
prosperous urban lifestyles that offer a good quality
of life (see Fig. 2.2). Combining lifestyle convenience
with consideration for the environment will be essen-
tial for the sustainable development of cities. This
balance is a very important aspect of urban policy.
Fig. 2.1: Optimizing stakeholder values
Chapter 2
Smart city
concept
World opinion
on the environment
Residents
City administrators
and developers
Fig. 2.2: Optimal balance among people, places, prosperity, and the planet
Ecology
Contribution to
global environment
Experience
Prosperous urban lifestyles
offering a good quality
of life
Establish a well-balanced harmony between the environment
(with goals such as reducing the burden on the environment)
and residents experiences (with goals such as improving
convenience, safety, prosperity, and the quality of life)
2-2 Optimal balance among people, places,
prosperity, and the planet
9
Hitachis Vision
for Smart Cities
Chapter
2
Hitachi sees its smart city approach as the best way to
resolve the problems faced by individual cities. The
approach takes into account both the economy and
the environment, can handle changing times and
social trends, and supports safe, interesting, and
prosperous lifestyles.
For this approach to work, we rst need to identify
the stakeholders and the structures and organizations
that make up a smart city, and to understand their
different points of view. Hitachi views the smart city
as having a hierarchical structure comprising a vari-
ety of infrastructure with different functions and
roles, and believes that, if each layer of this infra-
structure hierarchy is highly integrated, the city can
resolve problems and provide services more ef-
ciently and more effectively.
Smart city stakeholders include city administrators,
developers, residents, and groups sharing world
opinion on the environment. Such stakeholders have
different interests and interact with the city in
different ways, and stakeholders need to recognize
the existence of standpoints that might differ from
their own. For example, residents need to be aware
that people living well beyond the city borders might
be very concerned at the environmental problems of
the city. Similarly, when developing smart city
concepts and plans, city administrators need to take
into account the needs and concerns of residents and
other parties involved.
2-1 Smart city stakeholders
10
[1] Residents
This group represents the people who are active
within a city: living, working, learning, or traveling.
They are seeking to fulll their own needs, and to
achieve a better quality of life that is comfortable,
prosperous, convenient, interesting, and safe.
[2] City administrators and developers
City administrators include the local government and
other agencies that seek to boost the long-term com-
petitiveness and appeal of the city while focusing on
factors such as convenience, comfort, and accessibil-
ity. They include the agencies involved in managing
the city, but also need to keep in mind the achieve-
ment of national or international targets such as
those for reducing carbon emissions. City administra-
tors emphasize aspects like industrial vitality, achiev-
ing a cohesive society, and efcient urban operation.
Developers have objectives that include achieving
higher efciency and attracting people to the city,
which they achieve by adding value and working with
policies set by the local government. Developers
include people and groups engaged in the planning,
coordination, and construction of the urban environ-
ments that support the activities of residents. They
emphasize aspects like efcient urban development
and increasing added value.
[3] World opinion
Those sharing world opinion on the environment
include groups that desire to help protect the local,
national, and international environments. These
groups are often focused on goals such as maintain-
ing biodiversity, reducing carbon emissions, making
effective use of natural resources, and preventing
global warming.
The conicting standpoints and interests of these
different stakeholder groups mean their needs will
not necessarily coincide. For example, to reduce traf-
c congestion and local pollution, city administrators,
developers, and world opinion on the environment
might want to restrict access to the central city to EVs
(electric vehicles) only. They might also want to
implement systems for sharing EVs and for providing
charging stations at commercial facilities to attract
users and stimulate the local economy. However,
residents might oppose such policies because they
would no longer have the convenient option of driv-
ing their gasoline-powered cars into the city.
Making a smart city (or making a city smarter)
requires a balance among the diverse needs of differ-
ent stakeholders (see Fig. 2.1).
Hitachi believes that the best approach to develop
smart cities is to take all the stakeholder viewpoints
into account. For example to make a city smarter
requires examination of ecological, economic, and
people-oriented factors. But implementing these
insights is not the end of the process. Making a city
smarter provides the tools and systems to efciently
resolve a wide variety of problems in the future.
Smart cities considered desirable by all stakeholders
need to have the optimal balance between the eco-
logical (Eco) needs of the global environment and
the experiential values of the city residents who want
prosperous urban lifestyles that offer a good quality
of life (see Fig. 2.2). Combining lifestyle convenience
with consideration for the environment will be essen-
tial for the sustainable development of cities. This
balance is a very important aspect of urban policy.
Fig. 2.1: Optimizing stakeholder values
Chapter 2
Fig. 2.3: Hierarchical structure of a smart city
S
m
a
r
t

c
i
t
y
Residents
Daily life
Daily-life services infrastructure
Healthcare, education, administration, nance, etc.
Social infrastructure
Electric power distribution, intra-city transportation, water and sewage
Electric power transmission, inter-city transportation, water management
Smart-city management
infrastructure
Daily-life services
infrastructure
Urban infrastructure
National infrastructure
IT
Dwelling
Learning
Working
Transportation
Chapter
2
11
[1] Ecology: Concern for the global environment
Current urban development must handle changes in
the global environment while also reducing the
burden on the environment. Indeed, one of the
dening features of a smart city is how it responds to
global environmental concerns. Challenges include
the creation of a low-carbon society to mitigate
climate change, the efcient use of water resources to
resolve imbalances in supply and demand, and
responding to the depletion of fossil fuels and other
mineral resources by making effective use of energy.
[2] Experience: A prosperous urban lifestyle that
offers a good quality of life
An extremely important factor when considering the
sustainability of cities is how to enhance peoples
experiences (such as in living, working, studying, and
traveling). It is necessary to support prosperous urban
lifestyles that offer a good quality of life in a way that
is also balanced in economic terms, and that can
cope with changes in peoples lifestyles. Such an
approach can also be viewed as a means to help
resolve problems such as demographic changes and
problems faced by cities directly.
The following subsections give examples of what is
meant by and what is required for an optimal bal-
ance among the needs of different stakeholders.
(a) Optimizing the values of residents and developers
Too much emphasis on economics and efciency
risks damaging the distinctiveness and attractiveness
of a city. For example, in a historic township, simply
replacing traditional buildings with high-rises might
increase operational efciency, but it will also detract
from the citys value and its attractiveness to resi-
dents. A different approach is to preserve traditional
elements and have them co-exist with the new. This
encourages new values and enhances the value
added to the city.
To maintain an attractive urban environment, it is
important to seek common ground and mutual
understanding between residents and developers.
(b) Optimizing the values of city administrators and
world opinion
Giving excessive precedence to economic consider-
ations tends to result in environmental problems,
and conicts with world opinion on the environment.
For example, conventional coal-red power plants
have excellent economics, but they also emit large
quantities of carbon dioxide. Similarly, discharging
factory wastewater into the ocean might reduce
immediate economic costs, but cleanup may prove
expensive. Forging the optimal relationship between
the economy and the environment requires restruc-
turing the urban infrastructure, and coordinating
supply and demand through sophisticated controls.
(c) Optimizing the values of residents and world
opinion
Giving excessive precedence to the benets of indi-
viduals tends to exacerbate problems such as climate
change and the depletion of natural resources, and
to conict with world opinion on the environment.
For example, when large numbers of people choose
the convenience of their own cars, the result is higher
energy use and increased carbon dioxide emissions.
Similarly, if everyone uses a lot of electric power at
the same time, supply cannot meet demand.
Resolving such issues requires focusing on multiple
factors. For example, people will often eliminate
waste if they are provided with timely easy-to-
understand information on their energy usage. In
addition, sophisticated controls on supply and
demand are required across all of society.
Hitachi models smart cities as a hierarchy of infra-
structures that have different functions and purposes.
The national infrastructure and urban infrastructure
layers contain the most basic parts of the social infra-
structure. The daily-life services infrastructure layer
supplies services directly to residents. The smart-city
management infrastructure layer coordinates these
various layers through the use of IT (information
technology). The following sections give details about
the role of each type of infrastructure.
12
Hitachis vision is that each infrastructure layer will
interoperate under the control of the smart-city man-
agement infrastructure to support a way of life for
residents that takes into account the global environ-
ment, safety, and convenience (see Fig. 2.3).
[1] National infrastructure
This layer contains infrastructure that covers areas
larger than a single city. In addition to providing the
foundational layers of energy, transportation, water,
and communications that keep people safe and sup-
port their day-to-day activities at a national or
regional level, this is also the level at which coordina-
tion between different cities is managed.
Japans fast Shinkansen (the bullet train) inter-city
train service is an example of national infrastructure,
while the commuter transportation services that use
Shinkansen stations as hubs (such as subway and bus
services) are examples of urban infrastructure.
[2] Urban infrastructure
This layer contains infrastructure that supplies actual
services to residents and is organized into optimal
functional units based on the geographical and
physical characteristics of individual cities.
For example, the area covered by a single sewage
treatment plant would constitute one of these units.
For transportation, it would be the region accessible
by foot from a railway station or bus stop. Urban
infrastructure also includes waste disposal, telecom-
munications, and other services for a particular
district. Tasks such as balancing infrastructure func-
tions and the autonomous and decentralized coordi-
nation of functions are achieved using a building
block approach in which basic units are dened and
then combined.
[3] Daily-life services infrastructure
This layer is made up of a citys facilities and other
services, including healthcare, education, administra-
tion, and nance. The daily-life services infrastructure
coordinates with the urban infrastructure to supply
residents with a range of different services.
By using the Internet, services such as those for bank
transfers or for completing administrative procedures
can be provided without the need to go to specic
facilities. Services can be combined and provided in a
variety of contexts to match the needs of the resi-
dents.
2-3. Structure of a smart city
Hitachis Vision for Smart Cities
Fig. 2.3: Hierarchical structure of a smart city
S
m
a
r
t

c
i
t
y
Residents
Daily life
Daily-life services infrastructure
Healthcare, education, administration, nance, etc.
Social infrastructure
Electric power distribution, intra-city transportation, water and sewage
Electric power transmission, inter-city transportation, water management
Smart-city management
infrastructure
Daily-life services
infrastructure
Urban infrastructure
National infrastructure
IT
Dwelling
Learning
Working
Transportation
Chapter
2
11
[1] Ecology: Concern for the global environment
Current urban development must handle changes in
the global environment while also reducing the
burden on the environment. Indeed, one of the
dening features of a smart city is how it responds to
global environmental concerns. Challenges include
the creation of a low-carbon society to mitigate
climate change, the efcient use of water resources to
resolve imbalances in supply and demand, and
responding to the depletion of fossil fuels and other
mineral resources by making effective use of energy.
[2] Experience: A prosperous urban lifestyle that
offers a good quality of life
An extremely important factor when considering the
sustainability of cities is how to enhance peoples
experiences (such as in living, working, studying, and
traveling). It is necessary to support prosperous urban
lifestyles that offer a good quality of life in a way that
is also balanced in economic terms, and that can
cope with changes in peoples lifestyles. Such an
approach can also be viewed as a means to help
resolve problems such as demographic changes and
problems faced by cities directly.
The following subsections give examples of what is
meant by and what is required for an optimal bal-
ance among the needs of different stakeholders.
(a) Optimizing the values of residents and developers
Too much emphasis on economics and efciency
risks damaging the distinctiveness and attractiveness
of a city. For example, in a historic township, simply
replacing traditional buildings with high-rises might
increase operational efciency, but it will also detract
from the citys value and its attractiveness to resi-
dents. A different approach is to preserve traditional
elements and have them co-exist with the new. This
encourages new values and enhances the value
added to the city.
To maintain an attractive urban environment, it is
important to seek common ground and mutual
understanding between residents and developers.
(b) Optimizing the values of city administrators and
world opinion
Giving excessive precedence to economic consider-
ations tends to result in environmental problems,
and conicts with world opinion on the environment.
For example, conventional coal-red power plants
have excellent economics, but they also emit large
quantities of carbon dioxide. Similarly, discharging
factory wastewater into the ocean might reduce
immediate economic costs, but cleanup may prove
expensive. Forging the optimal relationship between
the economy and the environment requires restruc-
turing the urban infrastructure, and coordinating
supply and demand through sophisticated controls.
(c) Optimizing the values of residents and world
opinion
Giving excessive precedence to the benets of indi-
viduals tends to exacerbate problems such as climate
change and the depletion of natural resources, and
to conict with world opinion on the environment.
For example, when large numbers of people choose
the convenience of their own cars, the result is higher
energy use and increased carbon dioxide emissions.
Similarly, if everyone uses a lot of electric power at
the same time, supply cannot meet demand.
Resolving such issues requires focusing on multiple
factors. For example, people will often eliminate
waste if they are provided with timely easy-to-
understand information on their energy usage. In
addition, sophisticated controls on supply and
demand are required across all of society.
Hitachi models smart cities as a hierarchy of infra-
structures that have different functions and purposes.
The national infrastructure and urban infrastructure
layers contain the most basic parts of the social infra-
structure. The daily-life services infrastructure layer
supplies services directly to residents. The smart-city
management infrastructure layer coordinates these
various layers through the use of IT (information
technology). The following sections give details about
the role of each type of infrastructure.
12
Hitachis vision is that each infrastructure layer will
interoperate under the control of the smart-city man-
agement infrastructure to support a way of life for
residents that takes into account the global environ-
ment, safety, and convenience (see Fig. 2.3).
[1] National infrastructure
This layer contains infrastructure that covers areas
larger than a single city. In addition to providing the
foundational layers of energy, transportation, water,
and communications that keep people safe and sup-
port their day-to-day activities at a national or
regional level, this is also the level at which coordina-
tion between different cities is managed.
Japans fast Shinkansen (the bullet train) inter-city
train service is an example of national infrastructure,
while the commuter transportation services that use
Shinkansen stations as hubs (such as subway and bus
services) are examples of urban infrastructure.
[2] Urban infrastructure
This layer contains infrastructure that supplies actual
services to residents and is organized into optimal
functional units based on the geographical and
physical characteristics of individual cities.
For example, the area covered by a single sewage
treatment plant would constitute one of these units.
For transportation, it would be the region accessible
by foot from a railway station or bus stop. Urban
infrastructure also includes waste disposal, telecom-
munications, and other services for a particular
district. Tasks such as balancing infrastructure func-
tions and the autonomous and decentralized coordi-
nation of functions are achieved using a building
block approach in which basic units are dened and
then combined.
[3] Daily-life services infrastructure
This layer is made up of a citys facilities and other
services, including healthcare, education, administra-
tion, and nance. The daily-life services infrastructure
coordinates with the urban infrastructure to supply
residents with a range of different services.
By using the Internet, services such as those for bank
transfers or for completing administrative procedures
can be provided without the need to go to specic
facilities. Services can be combined and provided in a
variety of contexts to match the needs of the resi-
dents.
2-3. Structure of a smart city
Hitachis Vision for Smart Cities
IT
Energy
Data center
Transportation
Communications
Water
Logistics
Industry Commerce
Research, universities
Learn
Dwell
Work
Trans-
portation
Tourism, leisure Agriculture, sheries
Industrial
wastewater
treatment
Sewage
treatment
Water
treatment
New energy
Gas
Aviation
Shipping
Telephony
Internet
Broadcasting
Roads
Railways
Batteries
Large central
power plant
Smart-city
management
infrastructure
Retailers
Recycling
facilities
Factories
Energy
stations
Railway
stations
Hotels
Hospitals Schools
Residences
Public
facilities
Buildings
Financial
institutions
Fig. 2.4: Relationships between smart cities and IT
Equipment management
Operational information
Analysis and simulation
14
[2] Advanced controls for balancing supply and
demand
By utilizing IT to coordinate operation of the urban
infrastructure layer and the daily-life services infra-
structure layer, the smart-city management infra-
structure can provide access to more information on
supply and demand than was available in the past.
Not only is there more information, but techniques
such as data visualization make this data easier to
understand quickly. The balance between supply and
demand can be managed instantaneously, with high
precision.
(a) Control of demand
By guiding and controlling demand-side needs, it is
possible to smooth the utilization of urban infrastruc-
ture equipment, without changing total demand. For
example, this approach can reduce trafc congestion
by controlling peaks in road demand, or can manage
demand in situations where supply-side control is
difcult, such as the output from solar power genera-
tion.
(b) Control of supply
Supply of scarce resources can be provided even
during times of shortages by using system-wide con-
trol of supply levels to manage the supply for indi-
vidual demands. In the case of electric power, for
example, the available supply might be allocated
according to public priorities, or by allocating only
the exact minimum needed at that time.
[3] Integrated services delivered in optimal combi-
nations
By using IT to seamlessly interlink resources, func-
tions, and services, a smart city can provide a single
integrated service that is optimized to take advantage
of the characteristics of each component.
Consider transportation, for example. A smart city
can provide transportation services that deliver
people to their destination and satisfy user require-
ments for safety, convenience, and economy by simu-
lating the combined operation of trains, buses and
other public transportation, car rental or sharing
arrangements, and private cars. Or consider energy. A
smart city can achieve a exible and reliable supply
of electric power by making maximum use of solar,
wind, and other forms of renewable energy in addi-
tion to thermal, hydro, and other base-load electric
power generation facilities.
As in these examples, IT is essential to delivering the
optimal combination of services that meets demand
and suits regional circumstances.
13
[4] Smart-city management infrastructure
This infrastructure uses IT to provide information
platforms for linking within and between different
types of infrastructure. Its roles include information
management, operational management, and equip-
ment operation within the city.
The smart-city management infrastructure handles
information and controls across the different types of
infrastructure needed by a city. Examples include
smart grids in the energy sector, navigation systems
and green mobility involving the use of EVs in the
transportation sector, and advanced water manage-
ment systems using water from rain and recycling in
the water sector.
[5] Daily life
This represents the residents way of life and how
people use the infrastructure to live, work, study, and
travel. Hitachi seeks to improve the quality of life by
understanding residents genuine needs and then
disassembling and reassembling the functions of the
corresponding layer (daily-life services infrastructure)
accordingly.
Hitachi sees smart cities as emerging from combina-
ti ons of el ements that make up the hi erarchy
described above. The smart-city management infra-
structure plays a key role as the common platform
enabling various combinations. For example, this
management infrastructure can ensure that services
are available when and where they are needed, and
can help residents achieve a good quality of life with
the minimum impact on the environment. The man-
agement infrastructure can coordinate both the
physical and system components of the common ele-
ments that make up a city (such as buildings, roads,
railways, and utilities) and those elements that differ
by region (such as residential areas, central business
districts, and commercial areas) (see Fig. 2.4).
[1] Advanced IT and Autonomous Decentralized
Systems for the social infrastructure
Hitachi believes that a fusion of two different types of
IT can resolve the issues confronting social infrastruc-
ture and help develop smart cities that are secure
and comfortable while taking the environment into
account. These two types of IT are control systems,
which can operate the social infrastructure safely,
efciently, smoothly, and in harmony with the envi-
ronment; and information systems, which help
deliver the security, convenience, and comfort of a
smart city lifestyle.
For example, information systems can collect opera-
tional data from various areas of life, and then trans-
form this data into information and knowledge that
applications can use to provide smart services. For
example, data can be used to predict demand spikes
that require extra resources. Similarly, control
systems can use this information for more nely
grai ned management and operati on. Thi s can
enhance the operation of factories, electric power
systems, railways, and other services. Through this
integration of information, it is possible to develop
infrastructure systems that are optimized across the
whole of society.
Also, when the urban infrastructure is being con-
structed, the scope of each function should be kept
as small as possible, and the individual functions
should be independent. This is in accordance with
Hitachis concept of Autonomous Decentralized Sys-
tems, which Hitachi has successfully implemented in
multiple projects. Such systems can be developed in
modul ar steps, and the resul ti ng systems are
extremely robust and disaster resilient. Autonomous
Decentralized Systems prevent faults from spreading
across an entire system, and avoid service outages
during construction work or when local malfunctions
occur.
These Autonomous Decentralized Systems can be fur-
ther developed into symbiotic systems that facilitate
interoperations between systems and communities,
leading to cities that can dynamically adapt long into
the future, while still maintaining uninterrupted 24/7
operation.
2-4. Smart-city management infrastructure
Hitachis Vision for Smart Cities
Chapter
2
IT
Energy
Data center
Transportation
Communications
Water
Logistics
Industry Commerce
Research, universities
Learn
Dwell
Work
Trans-
portation
Tourism, leisure Agriculture, sheries
Industrial
wastewater
treatment
Sewage
treatment
Water
treatment
New energy
Gas
Aviation
Shipping
Telephony
Internet
Broadcasting
Roads
Railways
Batteries
Large central
power plant
Smart-city
management
infrastructure
Retailers
Recycling
facilities
Factories
Energy
stations
Railway
stations
Hotels
Hospitals Schools
Residences
Public
facilities
Buildings
Financial
institutions
Fig. 2.4: Relationships between smart cities and IT
Equipment management
Operational information
Analysis and simulation
14
[2] Advanced controls for balancing supply and
demand
By utilizing IT to coordinate operation of the urban
infrastructure layer and the daily-life services infra-
structure layer, the smart-city management infra-
structure can provide access to more information on
supply and demand than was available in the past.
Not only is there more information, but techniques
such as data visualization make this data easier to
understand quickly. The balance between supply and
demand can be managed instantaneously, with high
precision.
(a) Control of demand
By guiding and controlling demand-side needs, it is
possible to smooth the utilization of urban infrastruc-
ture equipment, without changing total demand. For
example, this approach can reduce trafc congestion
by controlling peaks in road demand, or can manage
demand in situations where supply-side control is
difcult, such as the output from solar power genera-
tion.
(b) Control of supply
Supply of scarce resources can be provided even
during times of shortages by using system-wide con-
trol of supply levels to manage the supply for indi-
vidual demands. In the case of electric power, for
example, the available supply might be allocated
according to public priorities, or by allocating only
the exact minimum needed at that time.
[3] Integrated services delivered in optimal combi-
nations
By using IT to seamlessly interlink resources, func-
tions, and services, a smart city can provide a single
integrated service that is optimized to take advantage
of the characteristics of each component.
Consider transportation, for example. A smart city
can provide transportation services that deliver
people to their destination and satisfy user require-
ments for safety, convenience, and economy by simu-
lating the combined operation of trains, buses and
other public transportation, car rental or sharing
arrangements, and private cars. Or consider energy. A
smart city can achieve a exible and reliable supply
of electric power by making maximum use of solar,
wind, and other forms of renewable energy in addi-
tion to thermal, hydro, and other base-load electric
power generation facilities.
As in these examples, IT is essential to delivering the
optimal combination of services that meets demand
and suits regional circumstances.
13
[4] Smart-city management infrastructure
This infrastructure uses IT to provide information
platforms for linking within and between different
types of infrastructure. Its roles include information
management, operational management, and equip-
ment operation within the city.
The smart-city management infrastructure handles
information and controls across the different types of
infrastructure needed by a city. Examples include
smart grids in the energy sector, navigation systems
and green mobility involving the use of EVs in the
transportation sector, and advanced water manage-
ment systems using water from rain and recycling in
the water sector.
[5] Daily life
This represents the residents way of life and how
people use the infrastructure to live, work, study, and
travel. Hitachi seeks to improve the quality of life by
understanding residents genuine needs and then
disassembling and reassembling the functions of the
corresponding layer (daily-life services infrastructure)
accordingly.
Hitachi sees smart cities as emerging from combina-
ti ons of el ements that make up the hi erarchy
described above. The smart-city management infra-
structure plays a key role as the common platform
enabling various combinations. For example, this
management infrastructure can ensure that services
are available when and where they are needed, and
can help residents achieve a good quality of life with
the minimum impact on the environment. The man-
agement infrastructure can coordinate both the
physical and system components of the common ele-
ments that make up a city (such as buildings, roads,
railways, and utilities) and those elements that differ
by region (such as residential areas, central business
districts, and commercial areas) (see Fig. 2.4).
[1] Advanced IT and Autonomous Decentralized
Systems for the social infrastructure
Hitachi believes that a fusion of two different types of
IT can resolve the issues confronting social infrastruc-
ture and help develop smart cities that are secure
and comfortable while taking the environment into
account. These two types of IT are control systems,
which can operate the social infrastructure safely,
efciently, smoothly, and in harmony with the envi-
ronment; and information systems, which help
deliver the security, convenience, and comfort of a
smart city lifestyle.
For example, information systems can collect opera-
tional data from various areas of life, and then trans-
form this data into information and knowledge that
applications can use to provide smart services. For
example, data can be used to predict demand spikes
that require extra resources. Similarly, control
systems can use this information for more nely
grai ned management and operati on. Thi s can
enhance the operation of factories, electric power
systems, railways, and other services. Through this
integration of information, it is possible to develop
infrastructure systems that are optimized across the
whole of society.
Also, when the urban infrastructure is being con-
structed, the scope of each function should be kept
as small as possible, and the individual functions
should be independent. This is in accordance with
Hitachis concept of Autonomous Decentralized Sys-
tems, which Hitachi has successfully implemented in
multiple projects. Such systems can be developed in
modul ar steps, and the resul ti ng systems are
extremely robust and disaster resilient. Autonomous
Decentralized Systems prevent faults from spreading
across an entire system, and avoid service outages
during construction work or when local malfunctions
occur.
These Autonomous Decentralized Systems can be fur-
ther developed into symbiotic systems that facilitate
interoperations between systems and communities,
leading to cities that can dynamically adapt long into
the future, while still maintaining uninterrupted 24/7
operation.
2-4. Smart-city management infrastructure
Hitachis Vision for Smart Cities
Chapter
2
Sustainable growth
Progress in steps while
avoiding shocks and upheavals
Renewal
Link different types of systems
so they can interoperate
Development
Expand geographical scope and optimize
overall operation across a wide area
Rapidly deploy systems within regions
Growth
15
Fig. 2.5: Infrastructure systems in a growing smart city
For objectives such as the sustainable growth of infrastructure
and business continuity planning (BCP), systems should be
designed, built, and operated in ways that allow repeated
cycles of growth, development, and renewal in accordance
with the stage of development that a city has reached.
16
[2] Step-by-step objectives of a smart city
Smart cities should aspire to different objectives at
different stages of a citys development.
(1) Minimum objectives
At the lowest stage, the city aims to provide the
societys infrastructure at a level that provides people
with the minimum they need to live a civilized life.
The provided services are primarily essential services.
(2) Basic objectives
At the next stage, the city aims to achieve various
objectives or standards (such as reducing carbon emis-
sions) agreed on at a national or international level.
The goals include providing an adequate shared
public infrastructure.
(3) City-specic objectives
At the next stage, in addition to providing the daily-
life services infrastructure, the city aims to achieve
specied benchmarks (such as numerical indicators
that measure the crime rate or congestion). However,
it is up to the city itself to decide which criteria or
benchmarks to use. If objectives or standards are
changed, it is necessary to be able to respond quickly
to the new requirements.
(4) High-level objectives
At this high-level stage, the values of a city and its
residents include many qualitative concepts and
things of an emotional nature, such as lifestyle values
and a sense of attachment to the neighborhood. As it
is unlikely that all benchmarks can be achieved
adequately, it is desirable to adopt mechanisms for
assessing the level of achievement that are based on
weighted averages of a number of indicators, such as
Japans Top Runner program for improving energy
efciency.
These objectives can be thought of in terms of the
self-actualization theory that categorizes human
wants into ve stages. This theory was proposed by
Ameri can psychol ogi st Abraham Masl ow, who
hypothesized that human beings continuously move
towards self-actualization. In this case, the minimum
objectives can be thought of as corresponding to
what Maslow calls physiological needs, the basic
objectives to safety needs, the city-specic objec-
tives to social needs, and the high-level objectives
to esteem needs and self-actualization needs.
[3] Economic growth of a smart city
When considered from an economics viewpoint, a
city can be thought of as an entity that enables eco-
nomic or business groups to obtain income from out-
side its geographical region by selling products and
goods, and then enables the obtained revenues to
circulate within its region. Accordingly, the economic
performance of a city can be viewed from two view-
points: its industrial competitiveness relative to other
regions, and the soundness of the nances within its
region.
Industrial competitiveness can be thought of in rela-
tion to the ow of economic activity in the city. A city
can boost the competitiveness of its industries by
making the ow of people, products, money, and
information more efcient, so that they circulate
more freely. For example, cutting trafc congestion
can reduce opportunity costs and increase the citys
productivity.
The soundness of city nances, meanwhile, can be
related to the stock of economic activity in the city.
Effects such as depopulation caused by aging, lower
birth rates, and the concentration of populations in
urban areas can l eave ci ti es wi th an excess of
unneeded urban infrastructure, with the result that
the cost of its maintenance and upgrading places
pressure on nances. Waste can be reduced and eco-
nomic performance enhanced through measures
such as sharing equipment and other facilities or
reassigning them to where they are most needed.
Important factors in encouraging economic growth
include identifying and minimizing misuse and
waste, exibly adapting to changing city circum-
stances, and optimizing not only how systems are
built but also how they are used.
Measures to make a city into a smart city require
taking an integrated long-term approach to design,
development, and operation. The assessment of costs
and benets needs to look 10 or even 20 years ahead.
This allows cities to not only provide comfort, conve-
nience, and security for their residents, but also to
continue to remain attractive to businesses.
[4] Creation of new services through innovation
The use of IT in smart cities can lead to exciting innova-
tions and creation of new services. A smart city gener-
ates extensive data from its infrastructure via sensors
and other means. Access to this data opens up possibili-
ties for innovations and services within the daily-life
services infrastructure. For example, a trafc manage-
ment system could determine trafc conditions by
using vehicle-mounted devices to collect information
on car locations and speeds.
Naturally, individuals would have to give explicit per-
mission before allowing third parties access to certain
types of personal information acquired from the social
infrastructure. Robust security would be needed to pre-
vent data leakage and monitoring would be needed to
ensure that the information is used for agreed purposes
only. However, with the right security and privacy safe-
guards, access to such data can lead to many types of
new services. For example, if a car insurance company
could access the information on car locations and
speeds, the company could use it to assess the driving
of policy holders. In addition to using conventional pro-
le information such as age, gender, mileage, and
license type, this ability to evaluate each policy holders
driving patterns would allow the company to set appro-
priate premiums based on a better assessment of
actual risk.
The availability of such data has the potential to lead to
a wide variety of new applications. In addition to com-
mercial innovations, health and welfare services can
use the data to better focus their limited resources on
those most in need. This open approach to data can
unleash smart innovation that provides both public
and personal benets.
The idea of a smart city is an abstract one, and the
ideal form changes through each stage of a citys
development. To achieve a sustainable balance and
harmony between the values of residents and the
environment, urban development must proceed in a
far-sighted and planned manner with a focus on
achieving the objectives specic to each particular
city. The city must also operate within the relevant
constraints, including budgets, space, and each citys
individual priorities (see Fig. 2-5).
[1] What it takes to be a smart city
The process of creating an actual smart city requires
the identication of the right level of smartness for
that city, and requires undertaking long-term projects
aimed at achieving this. Hitachi considers this ques-
tion of a citys smartness from three different per-
spectives. As mentioned above, the rst is to optimize
conicting costs and benets to achieve a well-
balanced relationship between the various stakehold-
ers and their economic, environmental, and people-
oriented viewpoints. The second is to expand the
scope of optimization to include nearby cities. This
means achieving a balance not just between the
interests of a particular citys stakeholders, but also
taking into account relationships with neighboring
cities. The third is to take a lifecycle-based approach
to optimization described in the next section. This
section examines the process of urban growth over
the lifecycle of a city and describes optimal solutions
to suit each stage of development.
2-5. Smart city requirements
Hitachis Vision for Smart Cities
Chapter
2
Sustainable growth
Progress in steps while
avoiding shocks and upheavals
Renewal
Link different types of systems
so they can interoperate
Development
Expand geographical scope and optimize
overall operation across a wide area
Rapidly deploy systems within regions
Growth
15
Fig. 2.5: Infrastructure systems in a growing smart city
For objectives such as the sustainable growth of infrastructure
and business continuity planning (BCP), systems should be
designed, built, and operated in ways that allow repeated
cycles of growth, development, and renewal in accordance
with the stage of development that a city has reached.
16
[2] Step-by-step objectives of a smart city
Smart cities should aspire to different objectives at
different stages of a citys development.
(1) Minimum objectives
At the lowest stage, the city aims to provide the
societys infrastructure at a level that provides people
with the minimum they need to live a civilized life.
The provided services are primarily essential services.
(2) Basic objectives
At the next stage, the city aims to achieve various
objectives or standards (such as reducing carbon emis-
sions) agreed on at a national or international level.
The goals include providing an adequate shared
public infrastructure.
(3) City-specic objectives
At the next stage, in addition to providing the daily-
life services infrastructure, the city aims to achieve
specied benchmarks (such as numerical indicators
that measure the crime rate or congestion). However,
it is up to the city itself to decide which criteria or
benchmarks to use. If objectives or standards are
changed, it is necessary to be able to respond quickly
to the new requirements.
(4) High-level objectives
At this high-level stage, the values of a city and its
residents include many qualitative concepts and
things of an emotional nature, such as lifestyle values
and a sense of attachment to the neighborhood. As it
is unlikely that all benchmarks can be achieved
adequately, it is desirable to adopt mechanisms for
assessing the level of achievement that are based on
weighted averages of a number of indicators, such as
Japans Top Runner program for improving energy
efciency.
These objectives can be thought of in terms of the
self-actualization theory that categorizes human
wants into ve stages. This theory was proposed by
Ameri can psychol ogi st Abraham Masl ow, who
hypothesized that human beings continuously move
towards self-actualization. In this case, the minimum
objectives can be thought of as corresponding to
what Maslow calls physiological needs, the basic
objectives to safety needs, the city-specic objec-
tives to social needs, and the high-level objectives
to esteem needs and self-actualization needs.
[3] Economic growth of a smart city
When considered from an economics viewpoint, a
city can be thought of as an entity that enables eco-
nomic or business groups to obtain income from out-
side its geographical region by selling products and
goods, and then enables the obtained revenues to
circulate within its region. Accordingly, the economic
performance of a city can be viewed from two view-
points: its industrial competitiveness relative to other
regions, and the soundness of the nances within its
region.
Industrial competitiveness can be thought of in rela-
tion to the ow of economic activity in the city. A city
can boost the competitiveness of its industries by
making the ow of people, products, money, and
information more efcient, so that they circulate
more freely. For example, cutting trafc congestion
can reduce opportunity costs and increase the citys
productivity.
The soundness of city nances, meanwhile, can be
related to the stock of economic activity in the city.
Effects such as depopulation caused by aging, lower
birth rates, and the concentration of populations in
urban areas can l eave ci ti es wi th an excess of
unneeded urban infrastructure, with the result that
the cost of its maintenance and upgrading places
pressure on nances. Waste can be reduced and eco-
nomic performance enhanced through measures
such as sharing equipment and other facilities or
reassigning them to where they are most needed.
Important factors in encouraging economic growth
include identifying and minimizing misuse and
waste, exibly adapting to changing city circum-
stances, and optimizing not only how systems are
built but also how they are used.
Measures to make a city into a smart city require
taking an integrated long-term approach to design,
development, and operation. The assessment of costs
and benets needs to look 10 or even 20 years ahead.
This allows cities to not only provide comfort, conve-
nience, and security for their residents, but also to
continue to remain attractive to businesses.
[4] Creation of new services through innovation
The use of IT in smart cities can lead to exciting innova-
tions and creation of new services. A smart city gener-
ates extensive data from its infrastructure via sensors
and other means. Access to this data opens up possibili-
ties for innovations and services within the daily-life
services infrastructure. For example, a trafc manage-
ment system could determine trafc conditions by
using vehicle-mounted devices to collect information
on car locations and speeds.
Naturally, individuals would have to give explicit per-
mission before allowing third parties access to certain
types of personal information acquired from the social
infrastructure. Robust security would be needed to pre-
vent data leakage and monitoring would be needed to
ensure that the information is used for agreed purposes
only. However, with the right security and privacy safe-
guards, access to such data can lead to many types of
new services. For example, if a car insurance company
could access the information on car locations and
speeds, the company could use it to assess the driving
of policy holders. In addition to using conventional pro-
le information such as age, gender, mileage, and
license type, this ability to evaluate each policy holders
driving patterns would allow the company to set appro-
priate premiums based on a better assessment of
actual risk.
The availability of such data has the potential to lead to
a wide variety of new applications. In addition to com-
mercial innovations, health and welfare services can
use the data to better focus their limited resources on
those most in need. This open approach to data can
unleash smart innovation that provides both public
and personal benets.
The idea of a smart city is an abstract one, and the
ideal form changes through each stage of a citys
development. To achieve a sustainable balance and
harmony between the values of residents and the
environment, urban development must proceed in a
far-sighted and planned manner with a focus on
achieving the objectives specic to each particular
city. The city must also operate within the relevant
constraints, including budgets, space, and each citys
individual priorities (see Fig. 2-5).
[1] What it takes to be a smart city
The process of creating an actual smart city requires
the identication of the right level of smartness for
that city, and requires undertaking long-term projects
aimed at achieving this. Hitachi considers this ques-
tion of a citys smartness from three different per-
spectives. As mentioned above, the rst is to optimize
conicting costs and benets to achieve a well-
balanced relationship between the various stakehold-
ers and their economic, environmental, and people-
oriented viewpoints. The second is to expand the
scope of optimization to include nearby cities. This
means achieving a balance not just between the
interests of a particular citys stakeholders, but also
taking into account relationships with neighboring
cities. The third is to take a lifecycle-based approach
to optimization described in the next section. This
section examines the process of urban growth over
the lifecycle of a city and describes optimal solutions
to suit each stage of development.
2-5. Smart city requirements
Hitachis Vision for Smart Cities
Chapter
2
Government
Development
concept
Infrastructure
plan
Civil engineering and
construction design
Civil engineering and
construction work
Master plan Finance System design
System
implementation
Operation and
maintenance
services
Public agencies
System integrator
Producers
Total engineering
Construction
companies
Collaborative
consortium
Trading companies
Administrators/
operators
Machinery and
equipment
manufacturers
Residential builders
Universities and
research institutions
Financial
institutions
(Master developers)
17
Making
Smart Cities
Chapter
3
Chapter 3
A signicant part of Hitachi is at work making smart
cities and making cities smarter. Its smart city busi-
ness is a key pillar in the eld that Hitachi calls the
social innovation business. Hitachi participates in
smart city projects from the concept stage. It brings
together the combined strengths of the Hitachi
Group, which has products and research in areas of
energy, transportation, public industry, urban devel-
opment, information and telecommunications, and
information and control. Nevertheless, smart city
initiatives cover a vast area and Hitachi cannot
always achieve its objectives on its own. In its global
activities, Hitachi works with local governments, busi-
ness partners, local companies, and others to contrib-
ute to the making of smart cities. It acts in a range of
different roles, from urban planning to handling
operations.
While different cities face different challenges, the
process of investigating and deciding what sort of
smart city to develop is one that can be applied to
many cities. The design framework described in this
chapter provides useful guidelines on how Hitachi
engages in dialog with cities, and works with them to
identify issues and to determine the direction that
the development should take. Hitachi can apply its
accumulated expertise to identify the best solutions
for each city.
Hitachi also believes that the new solutions it pro-
vides will serve as a nucleus for overcoming the chal-
lenges faced by other cities, and for achieving smart
cities in the future.
18
Hitachi boasts extensive experience and total engineer-
ing capabilities in many elds such as nance, service
design, system design, and operation and mainte-
nance. These capabilities have been built up over
many years of involvement in social infrastructure sec-
tors such as electric power, transportation, water and
sewage, and industrial systems. Hitachi also has a track
record that includes delivery of a wide range of differ-
ent solutions, including solutions in the information
and telecommunications sectors. By utilizing this expe-
rience and expertise, together with advanced technolo-
gies from Hitachis research laboratories, Hitachi is able
to achieve an advanced fusion of infrastructure control
with information and telecommunications systems.
These systems that fuse system controls and informa-
tion technologies are at the core of smart city develop-
ment. One of Hitachis greatest strengths is that it
brings together all of these core technologies in a single
corporate group. In terms of project execution, Hitachi
has also worked with customers on a number of major
projects where its involvement extended from identify-
ing the issues through to dening requirements, pro-
posing and implementing solutions, and providing
support for operation and maintenance.
By drawing on these in-house capabilities, Hitachi
intends to proceed with the development of smart
cities by working with the developers, construction
companies, manufacturers, trading companies, and
other organizations involved in urban development,
and taking a leading role in projects from the initial
planning stages.
3-1 Hitachis capabilities
Fig. 3.1: Smart city
development based
on collaborative
consortiums
Making a smart city requires long-term involvement by a wide
range of stakeholders, who work together on many aspects
from development to operation and maintenance (see Fig. 3.1).
This means that such projects need to be handled by collabora-
tive consortiums made up of industry, government, and
academia, each of whom brings a variety of different skills and
knowledge. Of particular importance are the master develop-
ers, including the government, public agencies, or nancial
institutions who act as producers (project organizers), and the
system integrators who put together the overall system. It is
essential for these two groups to work together. By members
working together to make a better city, a collaborative consor-
tium can handle the challenges of developing a smart city that
is constantly evolving.
Hitachi is actively involved as a system integrator in smart city
demonstration projects underway in Japan and elsewhere. Its
business model includes involvement in a variety of urban
projects in which it maintains close links with other businesses
and with national and local governments, and it then feeds this
experience back into its technology and development work.
Along with initiatives that are designed to suit the characteris-
tics of cities throughout the world, Hitachi is also establishing
indicators (also called indices or indexes) that give an objective
view of cities, and is participating in the formulation of rules
and international standardization for their application to other
cities.
The drive for collaboration in projects
Government
Development
concept
Infrastructure
plan
Civil engineering and
construction design
Civil engineering and
construction work
Master plan Finance System design
System
implementation
Operation and
maintenance
services
Public agencies
System integrator
Producers
Total engineering
Construction
companies
Collaborative
consortium
Trading companies
Administrators/
operators
Machinery and
equipment
manufacturers
Residential builders
Universities and
research institutions
Financial
institutions
(Master developers)
17
Making
Smart Cities
Chapter
3
Chapter 3
A signicant part of Hitachi is at work making smart
cities and making cities smarter. Its smart city busi-
ness is a key pillar in the eld that Hitachi calls the
social innovation business. Hitachi participates in
smart city projects from the concept stage. It brings
together the combined strengths of the Hitachi
Group, which has products and research in areas of
energy, transportation, public industry, urban devel-
opment, information and telecommunications, and
information and control. Nevertheless, smart city
initiatives cover a vast area and Hitachi cannot
always achieve its objectives on its own. In its global
activities, Hitachi works with local governments, busi-
ness partners, local companies, and others to contrib-
ute to the making of smart cities. It acts in a range of
different roles, from urban planning to handling
operations.
While different cities face different challenges, the
process of investigating and deciding what sort of
smart city to develop is one that can be applied to
many cities. The design framework described in this
chapter provides useful guidelines on how Hitachi
engages in dialog with cities, and works with them to
identify issues and to determine the direction that
the development should take. Hitachi can apply its
accumulated expertise to identify the best solutions
for each city.
Hitachi also believes that the new solutions it pro-
vides will serve as a nucleus for overcoming the chal-
lenges faced by other cities, and for achieving smart
cities in the future.
18
Hitachi boasts extensive experience and total engineer-
ing capabilities in many elds such as nance, service
design, system design, and operation and mainte-
nance. These capabilities have been built up over
many years of involvement in social infrastructure sec-
tors such as electric power, transportation, water and
sewage, and industrial systems. Hitachi also has a track
record that includes delivery of a wide range of differ-
ent solutions, including solutions in the information
and telecommunications sectors. By utilizing this expe-
rience and expertise, together with advanced technolo-
gies from Hitachis research laboratories, Hitachi is able
to achieve an advanced fusion of infrastructure control
with information and telecommunications systems.
These systems that fuse system controls and informa-
tion technologies are at the core of smart city develop-
ment. One of Hitachis greatest strengths is that it
brings together all of these core technologies in a single
corporate group. In terms of project execution, Hitachi
has also worked with customers on a number of major
projects where its involvement extended from identify-
ing the issues through to dening requirements, pro-
posing and implementing solutions, and providing
support for operation and maintenance.
By drawing on these in-house capabilities, Hitachi
intends to proceed with the development of smart
cities by working with the developers, construction
companies, manufacturers, trading companies, and
other organizations involved in urban development,
and taking a leading role in projects from the initial
planning stages.
3-1 Hitachis capabilities
Fig. 3.1: Smart city
development based
on collaborative
consortiums
Making a smart city requires long-term involvement by a wide
range of stakeholders, who work together on many aspects
from development to operation and maintenance (see Fig. 3.1).
This means that such projects need to be handled by collabora-
tive consortiums made up of industry, government, and
academia, each of whom brings a variety of different skills and
knowledge. Of particular importance are the master develop-
ers, including the government, public agencies, or nancial
institutions who act as producers (project organizers), and the
system integrators who put together the overall system. It is
essential for these two groups to work together. By members
working together to make a better city, a collaborative consor-
tium can handle the challenges of developing a smart city that
is constantly evolving.
Hitachi is actively involved as a system integrator in smart city
demonstration projects underway in Japan and elsewhere. Its
business model includes involvement in a variety of urban
projects in which it maintains close links with other businesses
and with national and local governments, and it then feeds this
experience back into its technology and development work.
Along with initiatives that are designed to suit the characteris-
tics of cities throughout the world, Hitachi is also establishing
indicators (also called indices or indexes) that give an objective
view of cities, and is participating in the formulation of rules
and international standardization for their application to other
cities.
The drive for collaboration in projects
Identify underlying urban issues
and important factors
Issue phase Solution phase
Finance, etc.
Policy
Technology
Monitor Analyze
Control Simulate
Operation phase
Formulate the best mix of solutions Use monitoring to support
operation and management
Triple
bottom line
for indicators
World opinion on
the environment
Ecology
Residents
Society Economy
City administrators
and developers
Fig. 3.3: Triple bottom line for indicators
Ecology
Smart City Evaluation concept
Economy
Past indicator value
Current indicator value
New target indicator value
Current direction
Direction array
Society
Fig. 3.4: Use of indicators for urban operations
One difculty with managing smart cities is that they
have no single ultimate goal. Each city needs to iden-
tify the issues it faces, formulate solutions, and oper-
ate its services, and then to use the results of these
activities as feedback to maintain superior urban
operations. What is important, Hitachi believes, is to
dene a management framework consisting of issues,
solutions, and operations at each phase of city man-
agement, and to decide how best to work through
this cycle (see Fig. 3.2).
This management framework is suitable not only for
cities that are embarking on the smart city concept
from scratch, but also for making existing cities
smarter.
By drawing on the experience and expertise it has
built up over time, and by acting as a partner
through the entire lifecycle of a city, Hitachi is able to
encourage innovation from a long-term perspective,
including identifying changing needs quickly and
proposing the best possible solutions.
The management framework can be broadly divided
into the following phases.
[1] Issue phase
Some urban issues and problems are obvious, but
some are latent and hard to identify. In the issue
phase, Hitachi works with local governments and city
administrators to identify, analyze, and determine
directions for resolving latent issues and problems.
Underlying latent urban issues can be identied by
discussions and interactions between a city's special-
ists and Hitachis own experts in various elds. Fur-
thermore, simulation tools and other methods can be
used to identify latent issues, analyze their causes
and cause-and-effect relationships, and determine
the key factors that need to be targeted for improve-
ment.
Hitachi also has ongoing experience in dealing with
the urban issues that resulted from Japans period of
rapid economic growth. This gives it a depth of rst-
hand practical expertise that can be drawn on to help
avoid or resolve the issues that are likely to be faced
by rapidly growing emerging economies in the future.
[2] Solution phase
In this phase, optimal solutions are determined
based on the characteristics of each city and the
high-priority issues. This means choosing the mix of
solutions that is the optimum at this stage of the
citys lifecycle and dealing with any conicting needs.
Rather than just providing a collection of individual
products or services, Hitachi can devise and imple-
ment an integrated set of solutions that works with
the citys existing policies and practices.
[3] Operation phase
The operation phase does not consist of just deploy-
ing solutions. Hitachis support for smart city opera-
tion and management can also deliver ongoing
improvements to city functions and cope with new
requirements that result from the changing environ-
ment. Because continuous monitoring can identify
potential improvements in operational efciency and
anticipate risks, such items can be dealt with quickly
in the issue phase of the next development cycle.
3-2 Management framework
19
Fig. 3.2: Management framework
20
Before the challenges facing a city can be identied
in the issue phase described above, it is rst neces-
sary to collect a variety of data on the citys current
situation. Similarly, when formulating optimal solu-
tions for the city in the solution phase, it is essential
to use support tools such as indicators (also called
indices or indexes) that can give numerical values for
improvements and new targets. Hitachi is currently
working on establishing such indicators by consider-
ing them in terms of the "triple bottom line" (TBL).
TBL aims to measure success from an expanded set of
values and criteria, including economic, ecological,
and social costs and benets (see Fig. 3.3). In addition
to helping the strategic planning for future urban
operations, this process can be used to clarify the
issues that need to be resolved if particular strategies
are to be adopted, and also to present potential solu-
tions. By monitoring and analyzing the effectiveness
of a variety of solutions as they are being imple-
mented, Hitachi can provide ongoing support for
urban operations.
The new issues that arise during the operation phase
vary as the city advances through the different stages
of development. This makes it necessary to work
through repeated cycles of reassessment and review,
with reference to the direction, rate, and stage of the
citys growth. Hitachi helps keep the city heading in
the optimal direction by using innovative approaches
such as its Smart City Evaluation concept to estimate
how indicators will vary as the city grows (see Fig. 3.4).
When you consider its constituent elements, a city
3-3 Use of indicators for urban operations can be seen as a system of interlinked functions (the
infrastructure). These elements can be classied into
those common to many other cities and those that
are unique to a particular city. The common ele-
ments are associated with the basic, essential func-
tions of cities, such as commuter transportation and
water treatment.
There are a huge number of elements that make
individual cities distinct. Such elements include
aspects of the natural environment, such as geogra-
phy or climate; the citys economic health, such as its
nances or stage of development; its structures, poli-
cies, legal systems, and other administrative features;
and various differences in values between stakehold-
ers due to traditions or customs.
While taking into account the elements that are
common to all cities and the elements distinctive of a
particular city, Hitachi approaches the question of
what sort of smart city to design in terms of the
following three steps (see Fig. 3.5).
(1) Specify core principles
This step draws on shared principles that should form
part of any smart city. It determines the requirements
for the three elements that make up the infrastruc-
ture of a smart city, namely hardware (buildings,
roads, and other public facilities), software (policies
and rules), and systems (management and opera-
tion). Because all of these sectors are closely interre-
lated, it is necessary to adopt a broad-based perspec-
tive from the early planning stages. For each of these
sectors, a variety of issues can be dealt with exibly
by eshing out the concepts in dialogs with city stake-
holders from the earliest stages.
3-4 Design framework
Chapter
3
Making Smart Cities
Identify underlying urban issues
and important factors
Issue phase Solution phase
Finance, etc.
Policy
Technology
Monitor Analyze
Control Simulate
Operation phase
Formulate the best mix of solutions Use monitoring to support
operation and management
Triple
bottom line
for indicators
World opinion on
the environment
Ecology
Residents
Society Economy
City administrators
and developers
Fig. 3.3: Triple bottom line for indicators
Ecology
Smart City Evaluation concept
Economy
Past indicator value
Current indicator value
New target indicator value
Current direction
Direction array
Society
Fig. 3.4: Use of indicators for urban operations
One difculty with managing smart cities is that they
have no single ultimate goal. Each city needs to iden-
tify the issues it faces, formulate solutions, and oper-
ate its services, and then to use the results of these
activities as feedback to maintain superior urban
operations. What is important, Hitachi believes, is to
dene a management framework consisting of issues,
solutions, and operations at each phase of city man-
agement, and to decide how best to work through
this cycle (see Fig. 3.2).
This management framework is suitable not only for
cities that are embarking on the smart city concept
from scratch, but also for making existing cities
smarter.
By drawing on the experience and expertise it has
built up over time, and by acting as a partner
through the entire lifecycle of a city, Hitachi is able to
encourage innovation from a long-term perspective,
including identifying changing needs quickly and
proposing the best possible solutions.
The management framework can be broadly divided
into the following phases.
[1] Issue phase
Some urban issues and problems are obvious, but
some are latent and hard to identify. In the issue
phase, Hitachi works with local governments and city
administrators to identify, analyze, and determine
directions for resolving latent issues and problems.
Underlying latent urban issues can be identied by
discussions and interactions between a city's special-
ists and Hitachis own experts in various elds. Fur-
thermore, simulation tools and other methods can be
used to identify latent issues, analyze their causes
and cause-and-effect relationships, and determine
the key factors that need to be targeted for improve-
ment.
Hitachi also has ongoing experience in dealing with
the urban issues that resulted from Japans period of
rapid economic growth. This gives it a depth of rst-
hand practical expertise that can be drawn on to help
avoid or resolve the issues that are likely to be faced
by rapidly growing emerging economies in the future.
[2] Solution phase
In this phase, optimal solutions are determined
based on the characteristics of each city and the
high-priority issues. This means choosing the mix of
solutions that is the optimum at this stage of the
citys lifecycle and dealing with any conicting needs.
Rather than just providing a collection of individual
products or services, Hitachi can devise and imple-
ment an integrated set of solutions that works with
the citys existing policies and practices.
[3] Operation phase
The operation phase does not consist of just deploy-
ing solutions. Hitachis support for smart city opera-
tion and management can also deliver ongoing
improvements to city functions and cope with new
requirements that result from the changing environ-
ment. Because continuous monitoring can identify
potential improvements in operational efciency and
anticipate risks, such items can be dealt with quickly
in the issue phase of the next development cycle.
3-2 Management framework
19
Fig. 3.2: Management framework
20
Before the challenges facing a city can be identied
in the issue phase described above, it is rst neces-
sary to collect a variety of data on the citys current
situation. Similarly, when formulating optimal solu-
tions for the city in the solution phase, it is essential
to use support tools such as indicators (also called
indices or indexes) that can give numerical values for
improvements and new targets. Hitachi is currently
working on establishing such indicators by consider-
ing them in terms of the "triple bottom line" (TBL).
TBL aims to measure success from an expanded set of
values and criteria, including economic, ecological,
and social costs and benets (see Fig. 3.3). In addition
to helping the strategic planning for future urban
operations, this process can be used to clarify the
issues that need to be resolved if particular strategies
are to be adopted, and also to present potential solu-
tions. By monitoring and analyzing the effectiveness
of a variety of solutions as they are being imple-
mented, Hitachi can provide ongoing support for
urban operations.
The new issues that arise during the operation phase
vary as the city advances through the different stages
of development. This makes it necessary to work
through repeated cycles of reassessment and review,
with reference to the direction, rate, and stage of the
citys growth. Hitachi helps keep the city heading in
the optimal direction by using innovative approaches
such as its Smart City Evaluation concept to estimate
how indicators will vary as the city grows (see Fig. 3.4).
When you consider its constituent elements, a city
3-3 Use of indicators for urban operations can be seen as a system of interlinked functions (the
infrastructure). These elements can be classied into
those common to many other cities and those that
are unique to a particular city. The common ele-
ments are associated with the basic, essential func-
tions of cities, such as commuter transportation and
water treatment.
There are a huge number of elements that make
individual cities distinct. Such elements include
aspects of the natural environment, such as geogra-
phy or climate; the citys economic health, such as its
nances or stage of development; its structures, poli-
cies, legal systems, and other administrative features;
and various differences in values between stakehold-
ers due to traditions or customs.
While taking into account the elements that are
common to all cities and the elements distinctive of a
particular city, Hitachi approaches the question of
what sort of smart city to design in terms of the
following three steps (see Fig. 3.5).
(1) Specify core principles
This step draws on shared principles that should form
part of any smart city. It determines the requirements
for the three elements that make up the infrastruc-
ture of a smart city, namely hardware (buildings,
roads, and other public facilities), software (policies
and rules), and systems (management and opera-
tion). Because all of these sectors are closely interre-
lated, it is necessary to adopt a broad-based perspec-
tive from the early planning stages. For each of these
sectors, a variety of issues can be dealt with exibly
by eshing out the concepts in dialogs with city stake-
holders from the earliest stages.
3-4 Design framework
Chapter
3
Making Smart Cities
Example combination for a particular urban development project
Specify core principles
Specify shared principles suitable for many smart cities
Specify the design direction
Decide which direction to take with the basic strategies for
growth and development
Provide customized solutions
Solutions and services designed to suit the unique features of a city
(2) Specify the design direction
This step involves considering the diverse characteris-
tics of a city to determine which directions to take for
the basic growth and development strategies. When
deciding the type of smart city that a city should
aspire to become, the desirable requirements differ
both quantitatively (population, density, growth
rates, and so on) and qualitatively (residents aspira-
tions) depending on the current lifecycle phase of the
city. (As described in section 1-3, a city lifecycle goes
through the early phase, growth phase, mature phase,
and transformation phase.) Factors such as the citys
geography or the strength of its economy also inu-
ence its priorities. Another factor to be considered is
whether any useful ideas can be obtained from
development projects that are already in progress.
The directions in which the city should seek to grow
should be claried after considering the conditions
that need to be met, such as the legal system and
management structures used for running the city.
(3) Provide customized solutions
This step provides solutions and services designed to
suit the distinctive features of a city. It involves
systems that integrate the various solutions formu-
lated and evaluated during the steps to specify core
principles and the design direction. Adopting a mix of
unrelated solutions to solve problems individually
makes it more difcult for the people who operate
city services to do their job, and such solutions
cannot adapt exibly to the growth of the city. Fur-
thermore, adopting holistic and comprehensive ways
of overcoming the challenges faced by a city makes it
easier to provide more effective solutions. Rather
than being limited to its own products, Hitachi acts
as a system integrator whose role is to combine vari-
ous city-wide solutions into an integrated system.
A wide variety of organizations are involved in man-
aging a smart city. In some organizations, the
national or local government plays a central role.
However, many different organizational structures
and practices are used in different parts of the world.
Examples include services provided by third-sector
organizations (joint corporations that have invest-
ments from both the public and private sectors), ser-
vices in which the administrative body is determined
by a contract with the people who own the asset con-
cerned, and services operated by funds or other
private sector organizations. Other possibilities for
the future include organizations that form part of the
government or to whom the government has del-
egated certain authority. Whatever form these organi-
zations take, they are not just involved in a single
process of developing a smart city, but also in the
ongoing processes of development and operation.
This requires these different organizations to work
together, and to adopt practices and structures that
are designed for the long term and targeted at
enhancing the value of the city.
Through its involvement as a partner from concep-
tual planning to operation, Hitachi uses a variety of
different frameworks as it contributes to the provi-
sion of optimal solutions and the development of
attractive cities. Hitachi is currently involved in
numerous smart city projects in different parts of the
world where it is trialing specic practices and build-
ing experience. In its role of providing support for
smart city development, Hitachi will continue to
supply a wide range of solutions in the belief that it
has an essential role to play among those engaged in
urban development.
Fig. 3.5: Design framework
21
3-5 Smart city administrators
22
Hitachi is participating in the Kashiwa-no-Ha Smart
City Project, a major project in Japan. The project
involves public, private, and academic sectors work-
ing together to develop a smart city at Kashiwa City in
Chiba Prefecture. This city is located approximately
30 minutes by train from central Tokyo and has a
population of about 400,000. Mitsui Fudosan Co., Ltd.
is leading the project, and other participants include
Chiba Prefecture, Kashiwa City, the University of
Tokyo, and Chiba University. The aim is to build a
model for future city administration that uses a col-
laborative approach in which the local community is
in an administratively at structure that everyone can
participate in. The project offers solutions to prob-
lems encountered by cities around the world. The
project goals include developing an environmentally
friendly city, a city of health and longevity, and a city
of new industry creation.
The project is a good example of Hitachi's approach
to smart city development and operation. This
approach is based on extensive experience in Japan
and in other countries. Japan has been a particularly
good test bed for determining the best approach for
such projects because it has experienced a very large
number of issues in a short time: rapid urbanization
due to an economic boom, energy issues, environ-
mental issues related to the increased use of motor
vehicles, and a series of earthquakes that have
heightened awareness of the need for disaster pre-
paredness. Hitachi has had to confront such issues
and social changes in many cities in Japan. Based on
this experience, Hitachi believes that an approach
focused on solving issues, with extensive input from
all stakeholders, is critical for the sustainable devel-
opment of cities in the future. This approach involves
the residents and all of the stakeholders working
together to identify the issues that need to be
resolved and investigating solutions, and then imple-
menting and managing these solutions. Hitachi has
used and encouraged this approach in the Kashiwa-
no-Ha Smart City Project.
As part of the measures for achieving a good balance
with the environment, Hitachi is helping to develop
and implement a system called AEMS (Area Energy
Management System). AEMS is designed to improve
operating efciency, to fully utilize renewable or pre-
viously underutilized energy, and to help achieve
specic targets for reducing carbon emissions and
saving energy. Some AEMS-related activities are as
follows:
Promote energy saving activities by providing
easy-to-understand visual data on the amount of
consumed electric power, gas, and other energy
sources. Manage regional energy information, pre-
dict demand, and provide information on supply
and demand.
Coordinate electric power generated from renew-
able energy, batteries, and the power company to
allow exible allocation of electric power within the
area. Make maximum use of renewable energy to
reduce daytime peaks in electric power consumption.
Use multiple energy sources through technolo-
gies such as batteries and gas-red power genera-
tion. Ensure that essential services for residents con-
tinue to operate during power outages.
AEMS is designed so that it can incorporate new func-
tions and can expand its coverage area. In the future,
it will be capable of serving the entire Kashiwa-no-Ha
area, and will become a network equipped with
smart grid functions.
Hitachi has participated in this project from the plan-
ning stage as a member of Smart City Planning Inc., a
collaborative consortium of companies aiming at
establishing smart cities. Hitachi is a key player in the
project, and its responsibilities include the develop-
ment of AEMS, one of Kashiwa-no-Ha Smart Citys
core systems.
3-6 Case study: Kashiwa-no-Ha Smart City Project
Image courtesy of Mitsui Fudosan Co., Ltd.
Chapter
3
Making Smart Cities
Example combination for a particular urban development project
Specify core principles
Specify shared principles suitable for many smart cities
Specify the design direction
Decide which direction to take with the basic strategies for
growth and development
Provide customized solutions
Solutions and services designed to suit the unique features of a city
(2) Specify the design direction
This step involves considering the diverse characteris-
tics of a city to determine which directions to take for
the basic growth and development strategies. When
deciding the type of smart city that a city should
aspire to become, the desirable requirements differ
both quantitatively (population, density, growth
rates, and so on) and qualitatively (residents aspira-
tions) depending on the current lifecycle phase of the
city. (As described in section 1-3, a city lifecycle goes
through the early phase, growth phase, mature phase,
and transformation phase.) Factors such as the citys
geography or the strength of its economy also inu-
ence its priorities. Another factor to be considered is
whether any useful ideas can be obtained from
development projects that are already in progress.
The directions in which the city should seek to grow
should be claried after considering the conditions
that need to be met, such as the legal system and
management structures used for running the city.
(3) Provide customized solutions
This step provides solutions and services designed to
suit the distinctive features of a city. It involves
systems that integrate the various solutions formu-
lated and evaluated during the steps to specify core
principles and the design direction. Adopting a mix of
unrelated solutions to solve problems individually
makes it more difcult for the people who operate
city services to do their job, and such solutions
cannot adapt exibly to the growth of the city. Fur-
thermore, adopting holistic and comprehensive ways
of overcoming the challenges faced by a city makes it
easier to provide more effective solutions. Rather
than being limited to its own products, Hitachi acts
as a system integrator whose role is to combine vari-
ous city-wide solutions into an integrated system.
A wide variety of organizations are involved in man-
aging a smart city. In some organizations, the
national or local government plays a central role.
However, many different organizational structures
and practices are used in different parts of the world.
Examples include services provided by third-sector
organizations (joint corporations that have invest-
ments from both the public and private sectors), ser-
vices in which the administrative body is determined
by a contract with the people who own the asset con-
cerned, and services operated by funds or other
private sector organizations. Other possibilities for
the future include organizations that form part of the
government or to whom the government has del-
egated certain authority. Whatever form these organi-
zations take, they are not just involved in a single
process of developing a smart city, but also in the
ongoing processes of development and operation.
This requires these different organizations to work
together, and to adopt practices and structures that
are designed for the long term and targeted at
enhancing the value of the city.
Through its involvement as a partner from concep-
tual planning to operation, Hitachi uses a variety of
different frameworks as it contributes to the provi-
sion of optimal solutions and the development of
attractive cities. Hitachi is currently involved in
numerous smart city projects in different parts of the
world where it is trialing specic practices and build-
ing experience. In its role of providing support for
smart city development, Hitachi will continue to
supply a wide range of solutions in the belief that it
has an essential role to play among those engaged in
urban development.
Fig. 3.5: Design framework
21
3-5 Smart city administrators
22
Hitachi is participating in the Kashiwa-no-Ha Smart
City Project, a major project in Japan. The project
involves public, private, and academic sectors work-
ing together to develop a smart city at Kashiwa City in
Chiba Prefecture. This city is located approximately
30 minutes by train from central Tokyo and has a
population of about 400,000. Mitsui Fudosan Co., Ltd.
is leading the project, and other participants include
Chiba Prefecture, Kashiwa City, the University of
Tokyo, and Chiba University. The aim is to build a
model for future city administration that uses a col-
laborative approach in which the local community is
in an administratively at structure that everyone can
participate in. The project offers solutions to prob-
lems encountered by cities around the world. The
project goals include developing an environmentally
friendly city, a city of health and longevity, and a city
of new industry creation.
The project is a good example of Hitachi's approach
to smart city development and operation. This
approach is based on extensive experience in Japan
and in other countries. Japan has been a particularly
good test bed for determining the best approach for
such projects because it has experienced a very large
number of issues in a short time: rapid urbanization
due to an economic boom, energy issues, environ-
mental issues related to the increased use of motor
vehicles, and a series of earthquakes that have
heightened awareness of the need for disaster pre-
paredness. Hitachi has had to confront such issues
and social changes in many cities in Japan. Based on
this experience, Hitachi believes that an approach
focused on solving issues, with extensive input from
all stakeholders, is critical for the sustainable devel-
opment of cities in the future. This approach involves
the residents and all of the stakeholders working
together to identify the issues that need to be
resolved and investigating solutions, and then imple-
menting and managing these solutions. Hitachi has
used and encouraged this approach in the Kashiwa-
no-Ha Smart City Project.
As part of the measures for achieving a good balance
with the environment, Hitachi is helping to develop
and implement a system called AEMS (Area Energy
Management System). AEMS is designed to improve
operating efciency, to fully utilize renewable or pre-
viously underutilized energy, and to help achieve
specic targets for reducing carbon emissions and
saving energy. Some AEMS-related activities are as
follows:
Promote energy saving activities by providing
easy-to-understand visual data on the amount of
consumed electric power, gas, and other energy
sources. Manage regional energy information, pre-
dict demand, and provide information on supply
and demand.
Coordinate electric power generated from renew-
able energy, batteries, and the power company to
allow exible allocation of electric power within the
area. Make maximum use of renewable energy to
reduce daytime peaks in electric power consumption.
Use multiple energy sources through technolo-
gies such as batteries and gas-red power genera-
tion. Ensure that essential services for residents con-
tinue to operate during power outages.
AEMS is designed so that it can incorporate new func-
tions and can expand its coverage area. In the future,
it will be capable of serving the entire Kashiwa-no-Ha
area, and will become a network equipped with
smart grid functions.
Hitachi has participated in this project from the plan-
ning stage as a member of Smart City Planning Inc., a
collaborative consortium of companies aiming at
establishing smart cities. Hitachi is a key player in the
project, and its responsibilities include the develop-
ment of AEMS, one of Kashiwa-no-Ha Smart Citys
core systems.
3-6 Case study: Kashiwa-no-Ha Smart City Project
Image courtesy of Mitsui Fudosan Co., Ltd.
Chapter
3
Making Smart Cities
23
Chapter
4
Smart City,
Smart Life
A smart city provides a way of life that is safe, secure,
convenient, and comfortable. Hitachi denes the ser-
vices and facilities needed to provide this smart life
as the daily-life services infrastructure, and sees it as
an additional infrastructure layer on top of the
energy, transportation, and other functions of the
social infrastructure (see Fig. 4.1). An important idea
is that the daily-life services infrastructure can be
broken down (disassembled) into the various differ-
ent services provided by the city, and these individual
functions can then be made smarter (improved) and
put back together (reassembled) to develop a city that
satises the genuine needs of residents.
Hitachi sees the disassembly and reassembly of the
daily-life services infrastructure as one way to create
new value for smart cities. With the need to reduce
the burden on the environment as a prerequisite, this
approach can enhance convenience and comfort by
providing residents with integrated combinations of
services. This approach makes the sustainable growth
of cities possible, and can help make smart cities that
satisfy the diverse wants and needs of stakeholders
(the residents, city administrators and developers,
and groups sharing world opinion on the environ-
ment).
4-1 Disassembling and reassembling the daily-
life services infrastructure
24
[1] Daily-life services infrastructur
From a residents perspective, the services used in
daily life can be broadly divided into two groups. One
group contains those services that are dependent on
equipment or facilities, such as radiography at a hos-
pital. The other group contains services that are
accessible from any location if communications
services are available, such as inter-bank transfers of
funds over the Internet.
When combined with a telecommunications infra-
structure that has been enhanced by IT, even services
that were previously location-specic, such as school
lessons or obtaining forms from city hall, can be rede-
ned as an education ser vice or administrative
service that residents can access from anywhere and
at any time.
[2] Paradigm shift brought about by disassembling
and reassembling the daily-life services infra-
structure
The term disassembly refers to breaking down
services into specic functions and identifying the
goals of the services and functions. For example, hos-
pital services include functions such as consultation,
admission, meals, surgery, and the issuing of pre-
scriptions. The functions of admission and meals can
also be thought of as being the same as the equiva-
lent functions at a hotel. Also, the fundamental goal
of patients who enter a hospital is to have their illness
cured, and actions like visiting the hospital, being
admitted, or undergoing surger y are only steps
toward this goal.
Once we under st and the functi ons and goals,
improved services usually become possible. For
example, the introduction of new multi-function
facilities allows medical counseling at a neighbor-
hood center, which can result in better health for resi-
dents at a lower cost. Peoples medical needs can be
satised in ways that better suit their individual
requirements.
By separating city services from the conventional idea
that the services must be provided at specic facili-
ties, and reassembling the services based on funda-
mental goals and requirements, we can usher in a
paradigm shift in our approach to cities. This new
approach allows city administrators to deliver differ-
ent types of services at a reasonable cost, and resi-
dents can gain one-stop access to various services at
an appropriate price.
S
m
a
r
t
-
c
i
t
y

m
a
n
a
g
e
m
e
n
t

i
n
f
r
a
s
t
r
u
c
t
u
r
e
Fig. 4.1: Structure of the daily-life services infrastructure layer
D
a
i
l
y
-
l
i
f
e

s
e
r
v
i
c
e
s

i
n
f
r
a
s
t
r
u
c
t
u
r
e
S
o
c
i
a
l

i
n
f
r
a
s
t
r
u
c
t
u
r
e
Services
Everyday life
Non-face-to-face services
Face-to-face
services
Equipment and
machinery
Buildings or
structures
Energy,
transportation, water,
telecommunications
Face-to-face
services
Equipment and
machinery
Buildings or
structures
Energy,
transportation, water,
telecommunications
Energy, transportation, water, telecommunications
- Remote medicine
- Net banking
- Net communities
- Face-to-face medical
examination
- Cash withdrawal
Facilities
Urban
infrastructure
National
infrastructure
Chapter 4
23
Chapter
4
Smart City,
Smart Life
A smart city provides a way of life that is safe, secure,
convenient, and comfortable. Hitachi denes the ser-
vices and facilities needed to provide this smart life
as the daily-life services infrastructure, and sees it as
an additional infrastructure layer on top of the
energy, transportation, and other functions of the
social infrastructure (see Fig. 4.1). An important idea
is that the daily-life services infrastructure can be
broken down (disassembled) into the various differ-
ent services provided by the city, and these individual
functions can then be made smarter (improved) and
put back together (reassembled) to develop a city that
satises the genuine needs of residents.
Hitachi sees the disassembly and reassembly of the
daily-life services infrastructure as one way to create
new value for smart cities. With the need to reduce
the burden on the environment as a prerequisite, this
approach can enhance convenience and comfort by
providing residents with integrated combinations of
services. This approach makes the sustainable growth
of cities possible, and can help make smart cities that
satisfy the diverse wants and needs of stakeholders
(the residents, city administrators and developers,
and groups sharing world opinion on the environ-
ment).
4-1 Disassembling and reassembling the daily-
life services infrastructure
24
[1] Daily-life services infrastructur
From a residents perspective, the services used in
daily life can be broadly divided into two groups. One
group contains those services that are dependent on
equipment or facilities, such as radiography at a hos-
pital. The other group contains services that are
accessible from any location if communications
services are available, such as inter-bank transfers of
funds over the Internet.
When combined with a telecommunications infra-
structure that has been enhanced by IT, even services
that were previously location-specic, such as school
lessons or obtaining forms from city hall, can be rede-
ned as an education ser vice or administrative
service that residents can access from anywhere and
at any time.
[2] Paradigm shift brought about by disassembling
and reassembling the daily-life services infra-
structure
The term disassembly refers to breaking down
services into specic functions and identifying the
goals of the services and functions. For example, hos-
pital services include functions such as consultation,
admission, meals, surgery, and the issuing of pre-
scriptions. The functions of admission and meals can
also be thought of as being the same as the equiva-
lent functions at a hotel. Also, the fundamental goal
of patients who enter a hospital is to have their illness
cured, and actions like visiting the hospital, being
admitted, or undergoing surger y are only steps
toward this goal.
Once we under st and the functi ons and goals,
improved services usually become possible. For
example, the introduction of new multi-function
facilities allows medical counseling at a neighbor-
hood center, which can result in better health for resi-
dents at a lower cost. Peoples medical needs can be
satised in ways that better suit their individual
requirements.
By separating city services from the conventional idea
that the services must be provided at specic facili-
ties, and reassembling the services based on funda-
mental goals and requirements, we can usher in a
paradigm shift in our approach to cities. This new
approach allows city administrators to deliver differ-
ent types of services at a reasonable cost, and resi-
dents can gain one-stop access to various services at
an appropriate price.
S
m
a
r
t
-
c
i
t
y

m
a
n
a
g
e
m
e
n
t

i
n
f
r
a
s
t
r
u
c
t
u
r
e
Fig. 4.1: Structure of the daily-life services infrastructure layer
D
a
i
l
y
-
l
i
f
e

s
e
r
v
i
c
e
s

i
n
f
r
a
s
t
r
u
c
t
u
r
e
S
o
c
i
a
l

i
n
f
r
a
s
t
r
u
c
t
u
r
e
Services
Everyday life
Non-face-to-face services
Face-to-face
services
Equipment and
machinery
Buildings or
structures
Energy,
transportation, water,
telecommunications
Face-to-face
services
Equipment and
machinery
Buildings or
structures
Energy,
transportation, water,
telecommunications
Energy, transportation, water, telecommunications
- Remote medicine
- Net banking
- Net communities
- Face-to-face medical
examination
- Cash withdrawal
Facilities
Urban
infrastructure
National
infrastructure
Chapter 4
Common-use property
Reserve and
use services
when needed EVs
Meeting places and guest rooms
Solar or wind power generators
Batteries
Recycled water treatment
Waste collection facility
Remote healthcare facilities
Use as
required
Private property
1. By sharing resources such as EVs, meeting places, guest rooms,
and remote healthcare facilities and making them available for
residents to reserve when needed, individuals can make the
most of their own private property.
2. The cost to individual users can be reduced by aggregating
facilities such as solar or wind power generators, batteries,
recycled water treatment, and waste collection facilities.
Healthcare example
Prevention
Fitness club/spa
Medical
examination center
Clinic/hospital Outpatient center Nursing facility
Assisted-living
homes
Diagnosis and treatment Rehabilitation and nursing
Services
Fitness
Health
diagnosis
Equipment
and
machinery
Facilities
D
a
i
l
y
-
l
i
f
e

s
e
r
v
i
c
e
s

i
n
f
r
a
s
t
r
u
c
t
u
r
e
Buildings
and
structures
Counseling Tests
Medi-
cation
Nursing
Support
for
everyday
activities
In-home
medical
assistance
and
nursing
Rehabili-
tation
Treatment
or surgery
Blood
pressure
meters,
scales
Electronic
records
Imaging
and
diagnostic
machines
Blood
testing
machines
Beds Security
Surveil-
lance
sensors
Rehabili-
tation
equipment
In-house
power
generation
Treatment
machines
People (doctors, nurses, technicians, pharmacists, care providers, etc.)
Fig. 4.2: Example of disassembly of a daily-life services infrastructure
25
[3] Methods of disassembly and reassembly
This section uses an example to explain the disassem-
bly and reassembly of the daily-life services infrastruc-
ture.
(a) Disassembly
Taking note of the fundamental needs of city resi-
dents, divide the daily-life services infrastructure into
services and facilities, and then further divide the
facilities into a) buildings and structures and b) equip-
ment and machinery. The component elements into
which the infrastructure is divided can be used as
basic elements anywhere in the world (see Fig. 4.2).
(b) Improvement
Map the individual elements to the corresponding
fundamental needs, and then make the functions
smarter so that they can work more reliably and ef-
ciently. Specically, identify their fundamental pur-
pose and whether they are location dependent. Also,
consider whether they can be improved by techno-
logical advances and new innovations, or by tech-
nologies from other elds.
(c) Reassembly
Reassemble the disassembled and improved ele-
ments in ways that satisfy the requirements of the
individual city. For example, you can select only those
functions that are required for the needs of that citys
residents based on considerations such as its topogra-
phy, culture, religion, nationality, and level of infra-
structure. This allows the reassembly of a smart
daily-life services infrastructure that avoids waste and
only includes the functions that are actually required.
By disassembling and reassembling the functions of
the daily-life services infrastructure in this way, we
can change a city into a smart city that delivers new
value, and in which this infrastructure itself goes
through cycles of growth, development, and renewal.
26
Smart cities based on the concept of disassembling
and reassembling the daily-life services infrastructure
allow urban development to cater precisely to the
genuine needs of residents. The resulting smart city
provides the following new benets not only to resi-
dents, but also to the government groups and busi-
nesses involved in urban development, and also to
the operators of various urban operations.
[1] Sharing
Sharing can allow people to enjoy a high level of life-
style services at low cost by aggregating resources at a
central repository and making them available for
shared use. Examples include EVs, gathering places,
and remote healthcare facilities that are not used on
a daily basis, but which everyone might use from
time to time. Other examples include solar power
generators, batteries, or other equipment that is
expensive for people to own on their own. By adopt-
ing billing methods that charge in accordance with
use, and providing reservation systems that are
simple enough for everyone to use, residents can be
given trouble-free access to these services.
4-2 Anticipated benefits of disassembly and
reassembly
Example of shared use of neighborhood facilities
Chapter
4
Smart City, Smart Life
Common-use property
Reserve and
use services
when needed EVs
Meeting places and guest rooms
Solar or wind power generators
Batteries
Recycled water treatment
Waste collection facility
Remote healthcare facilities
Use as
required
Private property
1. By sharing resources such as EVs, meeting places, guest rooms,
and remote healthcare facilities and making them available for
residents to reserve when needed, individuals can make the
most of their own private property.
2. The cost to individual users can be reduced by aggregating
facilities such as solar or wind power generators, batteries,
recycled water treatment, and waste collection facilities.
Healthcare example
Prevention
Fitness club/spa
Medical
examination center
Clinic/hospital Outpatient center Nursing facility
Assisted-living
homes
Diagnosis and treatment Rehabilitation and nursing
Services
Fitness
Health
diagnosis
Equipment
and
machinery
Facilities
D
a
i
l
y
-
l
i
f
e

s
e
r
v
i
c
e
s

i
n
f
r
a
s
t
r
u
c
t
u
r
e
Buildings
and
structures
Counseling Tests
Medi-
cation
Nursing
Support
for
everyday
activities
In-home
medical
assistance
and
nursing
Rehabili-
tation
Treatment
or surgery
Blood
pressure
meters,
scales
Electronic
records
Imaging
and
diagnostic
machines
Blood
testing
machines
Beds Security
Surveil-
lance
sensors
Rehabili-
tation
equipment
In-house
power
generation
Treatment
machines
People (doctors, nurses, technicians, pharmacists, care providers, etc.)
Fig. 4.2: Example of disassembly of a daily-life services infrastructure
25
[3] Methods of disassembly and reassembly
This section uses an example to explain the disassem-
bly and reassembly of the daily-life services infrastruc-
ture.
(a) Disassembly
Taking note of the fundamental needs of city resi-
dents, divide the daily-life services infrastructure into
services and facilities, and then further divide the
facilities into a) buildings and structures and b) equip-
ment and machinery. The component elements into
which the infrastructure is divided can be used as
basic elements anywhere in the world (see Fig. 4.2).
(b) Improvement
Map the individual elements to the corresponding
fundamental needs, and then make the functions
smarter so that they can work more reliably and ef-
ciently. Specically, identify their fundamental pur-
pose and whether they are location dependent. Also,
consider whether they can be improved by techno-
logical advances and new innovations, or by tech-
nologies from other elds.
(c) Reassembly
Reassemble the disassembled and improved ele-
ments in ways that satisfy the requirements of the
individual city. For example, you can select only those
functions that are required for the needs of that citys
residents based on considerations such as its topogra-
phy, culture, religion, nationality, and level of infra-
structure. This allows the reassembly of a smart
daily-life services infrastructure that avoids waste and
only includes the functions that are actually required.
By disassembling and reassembling the functions of
the daily-life services infrastructure in this way, we
can change a city into a smart city that delivers new
value, and in which this infrastructure itself goes
through cycles of growth, development, and renewal.
26
Smart cities based on the concept of disassembling
and reassembling the daily-life services infrastructure
allow urban development to cater precisely to the
genuine needs of residents. The resulting smart city
provides the following new benets not only to resi-
dents, but also to the government groups and busi-
nesses involved in urban development, and also to
the operators of various urban operations.
[1] Sharing
Sharing can allow people to enjoy a high level of life-
style services at low cost by aggregating resources at a
central repository and making them available for
shared use. Examples include EVs, gathering places,
and remote healthcare facilities that are not used on
a daily basis, but which everyone might use from
time to time. Other examples include solar power
generators, batteries, or other equipment that is
expensive for people to own on their own. By adopt-
ing billing methods that charge in accordance with
use, and providing reservation systems that are
simple enough for everyone to use, residents can be
given trouble-free access to these services.
4-2 Anticipated benefits of disassembly and
reassembly
Example of shared use of neighborhood facilities
Chapter
4
Smart City, Smart Life
Remote
classroom service
Connect Use a PC or tablet to
connect to the system
Receive same lessons
as classmates at school
Use classroom recordings
to take delayed lessons
Use of videoconferencing
to discuss remedial
learning plan with doctor
Monitoring system
for emergencies
Healthcare
Education
Fig. 4.3: How disassembly and reassembly might benet hospitals or schools
S
u
p
p
o
r
t

c
h
i
l
d

s

r
e
c
o
v
e
r
y
a
n
d

p
s
y
c
h
o
l
o
g
i
c
a
l

c
a
r
e
Comprehensive
learning opportunities
Commuter rush, major event
1. Trafc congestion
occurs
2. Accept alternative
travel method
3. Trafc congestion relieved
Congestion
records
Change means of
transport and schedule
Data on ow of people
Control trafc signals. Modify timetables.
Forecast congestion
Forecast optimal benets
Recommendations,
equipment controls
Specify
destination.
Recommended route
Time required
Incentives
Target achieved
across entire region
1. Predict failure
to meet target
Electric power
consumption
predictions
Set targets
Report results
Electric power
consumption targets
3. Decide if request
can be met
4
.

R
e
a
l
l
o
c
a
t
e

e
l
e
c
t
r
i
c

p
o
w
e
r
2
.

R
e
q
u
e
s
t
r
e
a
l
l
o
c
a
t
i
o
n
A
r
e
a

m
a
n
a
g
e
m
e
n
t
Railway
Network Region
Homes
Ofces Factories
1. Moni tori ng the el ectri c power usage
predicts that the supply to the railway
company will be insufcient.
2. Ask factories, ofces, and homes in the
region whether they can reallocate electric
power.
3. Ofces that expect to have an excess of
electric power during the relevant time
period reallocate the power.
4 and 5. The mutual arrangement for reallo-
cation of electric power ensures that the
total power consumption of the region
remains within the target.
1. Use route search information and data on
the ow of people to predict when, where,
and to what extent trafc congestion will
occur, including the commuter rush in the
city center.
2. Provide recommendations on avoiding
congestion to smooth the movement of
people to their destinations, and deliver
incentives to those who wish to cooperate
(for example, by sending incentives to their
phones or other devices). Users select their
means of transport and the route they
want to travel, and the system modies
related items like trafc signals and bus or
train timetables accordingly.
3. The cooperation between users and different
forms of transportation infrastructure can
alleviate trafc congestion across the city.
27
[2] Arrangements for mutual assistance
Resources for which supply is limited, such as energy,
can be utilized more efciently through arrange-
ments for mutual assistance. For example, it is pos-
sible to use energy in a waste-free manner by adopt-
ing arrangements whereby the households within a
region coordinate their use of electric power to meet
total consumption targets. This approach uses
advanced techniques for precise demand predictions
and efcient reallocation methods. The approach can
also be applied to the utilization of human resources
such as healthcare workers or volunteers.
[3] Cooperation
Cooperation between users and multiple infrastruc-
ture systems can enable the smooth delivery of infra-
structural services to all parts. For example, coopera-
tion between users and different transportation infra-
structure components can alleviate trafc congestion
across a city. The cooperation might involve providing
congestion information and advice on how to avoid
congested routes, controlling trafc signals, and coor-
dinating bus and train schedules. Another benet is
that the accumulated data on the effects of different
measures to relieve congestion can lead to ongoing
improvements in performance.
Example of using arrangements for mutual assistance to smooth electric power consumption
Example of user cooperation relieving trafc congestion
28
This section uses specic examples to describe how
the disassembly and reassembly of the daily-life
services infrastructure will change the everyday lives
of people in smart cities.
[1] Disassembly and reassembly focused on services
After some of the consultation and treatment services
at a hospital (considered as a type of facility) are
disassembled and then reassembled to be indepen-
dent of location, residents can receive various health-
care services without time or location restrictions. For
example, it would become possible to receive remote
treatment, advice, or other assistance at facilities out-
side a hospital, or even on a train. Other possibilities
include children in hospital being able to receive the
same lessons as their classmates at school. Doctors
could provide counseling to children in their homes
or school without leaving the hospital (see Fig. 4.3).
Many innovations become possible in the education
sector, as well. For example, if you separate the provi-
sion of lessons (considered as a service) from schools
(considered as a type of facility), new forms of educa-
tion that overcome time and location barriers
become possible. Such innovations can help people
study whenever and wherever they want: for
example, innovations could provide free access to
library data, or provide teachers with videoconferenc-
ing systems and other communication tools.
4-3 New ways of life made possible by
disassembly and reassembly
Chapter
4
Smart City, Smart Life
Remote
classroom service
Connect Use a PC or tablet to
connect to the system
Receive same lessons
as classmates at school
Use classroom recordings
to take delayed lessons
Use of videoconferencing
to discuss remedial
learning plan with doctor
Monitoring system
for emergencies
Healthcare
Education
Fig. 4.3: How disassembly and reassembly might benet hospitals or schools
S
u
p
p
o
r
t

c
h
i
l
d

s

r
e
c
o
v
e
r
y
a
n
d

p
s
y
c
h
o
l
o
g
i
c
a
l

c
a
r
e
Comprehensive
learning opportunities
Commuter rush, major event
1. Trafc congestion
occurs
2. Accept alternative
travel method
3. Trafc congestion relieved
Congestion
records
Change means of
transport and schedule
Data on ow of people
Control trafc signals. Modify timetables.
Forecast congestion
Forecast optimal benets
Recommendations,
equipment controls
Specify
destination.
Recommended route
Time required
Incentives
Target achieved
across entire region
1. Predict failure
to meet target
Electric power
consumption
predictions
Set targets
Report results
Electric power
consumption targets
3. Decide if request
can be met
4
.

R
e
a
l
l
o
c
a
t
e

e
l
e
c
t
r
i
c

p
o
w
e
r
2
.

R
e
q
u
e
s
t
r
e
a
l
l
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c
a
t
i
o
n
A
r
e
a

m
a
n
a
g
e
m
e
n
t
Railway
Network Region
Homes
Ofces Factories
1. Moni tori ng the el ectri c power usage
predicts that the supply to the railway
company will be insufcient.
2. Ask factories, ofces, and homes in the
region whether they can reallocate electric
power.
3. Ofces that expect to have an excess of
electric power during the relevant time
period reallocate the power.
4 and 5. The mutual arrangement for reallo-
cation of electric power ensures that the
total power consumption of the region
remains within the target.
1. Use route search information and data on
the ow of people to predict when, where,
and to what extent trafc congestion will
occur, including the commuter rush in the
city center.
2. Provide recommendations on avoiding
congestion to smooth the movement of
people to their destinations, and deliver
incentives to those who wish to cooperate
(for example, by sending incentives to their
phones or other devices). Users select their
means of transport and the route they
want to travel, and the system modies
related items like trafc signals and bus or
train timetables accordingly.
3. The cooperation between users and different
forms of transportation infrastructure can
alleviate trafc congestion across the city.
27
[2] Arrangements for mutual assistance
Resources for which supply is limited, such as energy,
can be utilized more efciently through arrange-
ments for mutual assistance. For example, it is pos-
sible to use energy in a waste-free manner by adopt-
ing arrangements whereby the households within a
region coordinate their use of electric power to meet
total consumption targets. This approach uses
advanced techniques for precise demand predictions
and efcient reallocation methods. The approach can
also be applied to the utilization of human resources
such as healthcare workers or volunteers.
[3] Cooperation
Cooperation between users and multiple infrastruc-
ture systems can enable the smooth delivery of infra-
structural services to all parts. For example, coopera-
tion between users and different transportation infra-
structure components can alleviate trafc congestion
across a city. The cooperation might involve providing
congestion information and advice on how to avoid
congested routes, controlling trafc signals, and coor-
dinating bus and train schedules. Another benet is
that the accumulated data on the effects of different
measures to relieve congestion can lead to ongoing
improvements in performance.
Example of using arrangements for mutual assistance to smooth electric power consumption
Example of user cooperation relieving trafc congestion
28
This section uses specic examples to describe how
the disassembly and reassembly of the daily-life
services infrastructure will change the everyday lives
of people in smart cities.
[1] Disassembly and reassembly focused on services
After some of the consultation and treatment services
at a hospital (considered as a type of facility) are
disassembled and then reassembled to be indepen-
dent of location, residents can receive various health-
care services without time or location restrictions. For
example, it would become possible to receive remote
treatment, advice, or other assistance at facilities out-
side a hospital, or even on a train. Other possibilities
include children in hospital being able to receive the
same lessons as their classmates at school. Doctors
could provide counseling to children in their homes
or school without leaving the hospital (see Fig. 4.3).
Many innovations become possible in the education
sector, as well. For example, if you separate the provi-
sion of lessons (considered as a service) from schools
(considered as a type of facility), new forms of educa-
tion that overcome time and location barriers
become possible. Such innovations can help people
study whenever and wherever they want: for
example, innovations could provide free access to
library data, or provide teachers with videoconferenc-
ing systems and other communication tools.
4-3 New ways of life made possible by
disassembly and reassembly
Chapter
4
Smart City, Smart Life
Municipal and
public agencies
Power company
Gas company
Water agency
Post ofce
Telecommunications
company
Broadcaster
SC: smart city
Fig. 4.4: How disassembly and reassembly might benet moving and public administration services
Simplies steps for moving
to a new home. Improves
efciency of lifestyle
information management.
Smart city
living setup service
Commerce
Finance
(Publish information
on services for
new residents.)
(Loan, rent)
Update address
information
Lodge change
of address
(old home)
Lodge change
of address
(new home)
(Inquiry)
Municipal database
Publish information on services for new residents
(healthcare, schooling, etc.).
Arrangements From quotation
requests to scheduling
Relayed withdrawal
Change registered
address
Bank
Moving company
Real estate
agent
Area
management
Municipality
(old home)
Municipality
(new home)
Commercial
facilities
SC resident
database
30
[3] Disassembly and reassembly focused on location
By considering a railway station and reassembling its
disassembled functions, we can imagine some of the
various forms that a smart city station might take.
This new type of station could include various func-
tions to suit the wants or needs of different people.
For example, having terminals in each part of a sta-
tion would allow you to make full use of your short
waiting times. You could practice your golf swing with
the help of an on-screen instructor. Or you could use
your smartphone to photograph a product advertise-
ment in the station and to automatically order that
product from a nearby supermarket.
The service level of the daily-life services infrastruc-
ture can be further enhanced through coordination
with the social infrastructure. For example, the
potential of green electricity includes more than just
the use of solar panels. You could also use geother-
mal energy from under the station, and use the gen-
erated power for green services such as community
EVs or charging stands (see Fig. 4.5).
Fig. 4.5: How disassembly and reassembly might benet railway stations
29
[2] Disassembly and reassembly focused on the goals
and behavior of residents
Reassembling city functions based around the goals
and behavior of residents who use a service can also
create a more convenient and comfortable way of life.
Consider the example of moving to a new home. Cur-
rently, in Japan, you are forced to deal with separate
different municipal and public agencies (service pro-
viders), and have to go through various procedures
and ll out forms such as change-of-residence regis-
tration forms for your old and new addresses. How-
ever, by disassembling the actions required when
moving to a new home in terms of services, and then
reassembling them with a focus on goals and behav-
ior so that the various services provided by different
agencies work in coordination, the complex and
troublesome procedures of the past should no longer
be needed.
Specically, keeping your information up to date will
be made much easier if changes to personal details,
such as changes to your address or telephone
number, are managed centrally by area management
functions. This could include changing your details
with public agencies and nancial institutions or
changing your account at infrastructure service pro-
viders such as electricity, gas, water, or telecommuni-
cation providers. By coordinating with local service
providers, businesses, and others, this approach also
allows added-value services to be supplied specically
to new residents (see Fig. 4.4).
Railway station as a part of
the daily-life services infrastructure
Place where users can receive
services that match their needs
Provide timely
operating information
Smooth transfers
Coordinate logistics
Help people go
where they want to go
Display information
on various devices
Use of renewable
energy and supply
of electric power
On-site English
conversation class
Charging station
for EVs
On-site childcare
service
Smart city train station
Shopping facilities
Chapter
4
Smart City, Smart Life
Municipal and
public agencies
Power company
Gas company
Water agency
Post ofce
Telecommunications
company
Broadcaster
SC: smart city
Fig. 4.4: How disassembly and reassembly might benet moving and public administration services
Simplies steps for moving
to a new home. Improves
efciency of lifestyle
information management.
Smart city
living setup service
Commerce
Finance
(Publish information
on services for
new residents.)
(Loan, rent)
Update address
information
Lodge change
of address
(old home)
Lodge change
of address
(new home)
(Inquiry)
Municipal database
Publish information on services for new residents
(healthcare, schooling, etc.).
Arrangements From quotation
requests to scheduling
Relayed withdrawal
Change registered
address
Bank
Moving company
Real estate
agent
Area
management
Municipality
(old home)
Municipality
(new home)
Commercial
facilities
SC resident
database
30
[3] Disassembly and reassembly focused on location
By considering a railway station and reassembling its
disassembled functions, we can imagine some of the
various forms that a smart city station might take.
This new type of station could include various func-
tions to suit the wants or needs of different people.
For example, having terminals in each part of a sta-
tion would allow you to make full use of your short
waiting times. You could practice your golf swing with
the help of an on-screen instructor. Or you could use
your smartphone to photograph a product advertise-
ment in the station and to automatically order that
product from a nearby supermarket.
The service level of the daily-life services infrastruc-
ture can be further enhanced through coordination
with the social infrastructure. For example, the
potential of green electricity includes more than just
the use of solar panels. You could also use geother-
mal energy from under the station, and use the gen-
erated power for green services such as community
EVs or charging stands (see Fig. 4.5).
Fig. 4.5: How disassembly and reassembly might benet railway stations
29
[2] Disassembly and reassembly focused on the goals
and behavior of residents
Reassembling city functions based around the goals
and behavior of residents who use a service can also
create a more convenient and comfortable way of life.
Consider the example of moving to a new home. Cur-
rently, in Japan, you are forced to deal with separate
different municipal and public agencies (service pro-
viders), and have to go through various procedures
and ll out forms such as change-of-residence regis-
tration forms for your old and new addresses. How-
ever, by disassembling the actions required when
moving to a new home in terms of services, and then
reassembling them with a focus on goals and behav-
ior so that the various services provided by different
agencies work in coordination, the complex and
troublesome procedures of the past should no longer
be needed.
Specically, keeping your information up to date will
be made much easier if changes to personal details,
such as changes to your address or telephone
number, are managed centrally by area management
functions. This could include changing your details
with public agencies and nancial institutions or
changing your account at infrastructure service pro-
viders such as electricity, gas, water, or telecommuni-
cation providers. By coordinating with local service
providers, businesses, and others, this approach also
allows added-value services to be supplied specically
to new residents (see Fig. 4.4).
Railway station as a part of
the daily-life services infrastructure
Place where users can receive
services that match their needs
Provide timely
operating information
Smooth transfers
Coordinate logistics
Help people go
where they want to go
Display information
on various devices
Use of renewable
energy and supply
of electric power
On-site English
conversation class
Charging station
for EVs
On-site childcare
service
Smart city train station
Shopping facilities
Chapter
4
Smart City, Smart Life
31
Ever-Evolving Smart Cities
Each smart city is different, with different goals and
different challenges. For example, cities in developing
countries and developed countries demand different
service levels from their infrastructure. If the main
means of transport differ among cities (for example,
public transport versus private vehicles), those cities
face different challenges and opportunities. For local
governments funded by taxation, determining the top
priorities achievable within the current budget is a
key factor for their future economic development.
By participating in many smart city initiatives in
different parts of the world, Hitachi has undertaken a
variety of successful projects and demonstrations.
Through such work, it has accumulated considerable
exper tise concerning the processes involved in
making cities smart. Hitachi aims to work with cities
as a partner to identify their issues, formulate practi-
cal solutions, and support their operation.
32
Many cities around the world want to become smart
cities, but face a complex network of challenges. For
example, all cities need to invest in social infrastruc-
ture, such as roads and other public facilities. But all
cities have limited budgets and the investments must
take into account various nancial planning and eco-
nomic performance considerations. The cities must
also examine the efciency of such investments
under actual operating conditions.
Other challenges include those related to working
with other groups. For examples, cities must follow
the policies and rules set by national and local gov-
ernments, and must often set up and use specic
mechanisms to ensure fairness and appropriate cost
allocations. There are also many difculties in han-
dling issues that transcend local government bound-
aries, such as issues requiring decisions by the
national government, or decisions on sharing
arrangements. Even international standardization can
be an issue when managing and operating systems
and examining system efciency.
City administrators on their own cannot resolve this
complex mix of different elements, and neither can
developers, system vendors, or other suppliers work-
ing by themselves. What is needed is the formation of
collaborative consortiums with other stakeholders to
identif y the issues and then to proceed with the
urban development. This requires partners who can
engage in dialog from the earliest planning stages.
Hitachi can act as a partner for smart cities through
all stages: from conceptual planning to implementa-
tion, operation, and maintenance. This participation
goes beyond just providing solutions for issues. Hita-
chi can also help cities to evolve further through an
ongoing process in which regular monitoring is used
both to support operation and management and to
provide feedback.
Developing smart cities in ways that keep pace with
the changing environment requires the skills to clarify
the directions in which the city wishes to move, and
also to make the best decisions at each stage of that
growth.
Hitachis involvement is from a long-term perspective
and spans the entire lifecycle of a city, including help-
ing stakeholders to make the best decisions. Hitachi
takes a citywide perspective when helping the stake-
holders decide in what directions the city should
move (using the Smart City Evaluation concept), and
when selecting the best mix of solutions (using the
design framework). Choosing clear directions results
in a strong focus by city administrators, and leads to a
paradigm shift in possible solutions on how to supply
the city with a range of services in the best possible
format.
Based on its vision for smart cities, Hitachi aims to
contribute to the development of cities that meet
local needs and achieve the optimal balance among
the various stakeholders. Hitachi's approach is to
work with local governments, local companies, and
other partners to realize this vision.
5-1 Smart city development requires partners 5-2 Clarifying directions is crucial
Chapter
5
Chapter 5
31
Ever-Evolving Smart Cities
Each smart city is different, with different goals and
different challenges. For example, cities in developing
countries and developed countries demand different
service levels from their infrastructure. If the main
means of transport differ among cities (for example,
public transport versus private vehicles), those cities
face different challenges and opportunities. For local
governments funded by taxation, determining the top
priorities achievable within the current budget is a
key factor for their future economic development.
By participating in many smart city initiatives in
different parts of the world, Hitachi has undertaken a
variety of successful projects and demonstrations.
Through such work, it has accumulated considerable
exper tise concerning the processes involved in
making cities smart. Hitachi aims to work with cities
as a partner to identify their issues, formulate practi-
cal solutions, and support their operation.
32
Many cities around the world want to become smart
cities, but face a complex network of challenges. For
example, all cities need to invest in social infrastruc-
ture, such as roads and other public facilities. But all
cities have limited budgets and the investments must
take into account various nancial planning and eco-
nomic performance considerations. The cities must
also examine the efciency of such investments
under actual operating conditions.
Other challenges include those related to working
with other groups. For examples, cities must follow
the policies and rules set by national and local gov-
ernments, and must often set up and use specic
mechanisms to ensure fairness and appropriate cost
allocations. There are also many difculties in han-
dling issues that transcend local government bound-
aries, such as issues requiring decisions by the
national government, or decisions on sharing
arrangements. Even international standardization can
be an issue when managing and operating systems
and examining system efciency.
City administrators on their own cannot resolve this
complex mix of different elements, and neither can
developers, system vendors, or other suppliers work-
ing by themselves. What is needed is the formation of
collaborative consortiums with other stakeholders to
identif y the issues and then to proceed with the
urban development. This requires partners who can
engage in dialog from the earliest planning stages.
Hitachi can act as a partner for smart cities through
all stages: from conceptual planning to implementa-
tion, operation, and maintenance. This participation
goes beyond just providing solutions for issues. Hita-
chi can also help cities to evolve further through an
ongoing process in which regular monitoring is used
both to support operation and management and to
provide feedback.
Developing smart cities in ways that keep pace with
the changing environment requires the skills to clarify
the directions in which the city wishes to move, and
also to make the best decisions at each stage of that
growth.
Hitachis involvement is from a long-term perspective
and spans the entire lifecycle of a city, including help-
ing stakeholders to make the best decisions. Hitachi
takes a citywide perspective when helping the stake-
holders decide in what directions the city should
move (using the Smart City Evaluation concept), and
when selecting the best mix of solutions (using the
design framework). Choosing clear directions results
in a strong focus by city administrators, and leads to a
paradigm shift in possible solutions on how to supply
the city with a range of services in the best possible
format.
Based on its vision for smart cities, Hitachi aims to
contribute to the development of cities that meet
local needs and achieve the optimal balance among
the various stakeholders. Hitachi's approach is to
work with local governments, local companies, and
other partners to realize this vision.
5-1 Smart city development requires partners 5-2 Clarifying directions is crucial
Chapter
5
Chapter 5
33 34
Epilogue
In Japan, recent natural disasters (such as earthquakes
and tsunamis) have had a large impact on the mindsets of
many people. For example, when deprived of basic
services for the rst time in their lives or when seeing the
plight of victims on TV, many people realized that they
could not and should not take such services for granted.
Many ordinary Japanese have started thinking about the
balance between supply and demand of energy in the
cities in which they live and across the entire country.
They are realizing that, especially when resources are
scarce, acting in ways that reduce energy consumption
and boost efciency across all of society can lighten the
burden on suppliers and can help society move towards a
sustainable society.
Smart cities can help residents reduce waste and improve
efciency. For example, by providing timely information
on current energy usage in easy-to-understand visual
formats, smart cities can help residents understand how
to help themselves and help the environment. Such
systems will change how the world works.
The time for smart cities has come. The cities of the future
will not be measured just by economic indicators. A smart
city provides enhanced environmental performance, eco-
nomic value, and social value over the long term.
Hitachi believes that smart cities are essential for a
sustainable future, and is proud to be playing a key role in
this movement. Hitachi's vision for smart cities is being
realized and, even now, Hitachi is engaging with stake-
holders to design and develop smart cities that are good
for the environment, good for the economy, and good for
people. Hitachi expects the benets of smart cities to con-
tinue as long as the cities themselves.
33 34
Epilogue
In Japan, recent natural disasters (such as earthquakes
and tsunamis) have had a large impact on the mindsets of
many people. For example, when deprived of basic
services for the rst time in their lives or when seeing the
plight of victims on TV, many people realized that they
could not and should not take such services for granted.
Many ordinary Japanese have started thinking about the
balance between supply and demand of energy in the
cities in which they live and across the entire country.
They are realizing that, especially when resources are
scarce, acting in ways that reduce energy consumption
and boost efciency across all of society can lighten the
burden on suppliers and can help society move towards a
sustainable society.
Smart cities can help residents reduce waste and improve
efciency. For example, by providing timely information
on current energy usage in easy-to-understand visual
formats, smart cities can help residents understand how
to help themselves and help the environment. Such
systems will change how the world works.
The time for smart cities has come. The cities of the future
will not be measured just by economic indicators. A smart
city provides enhanced environmental performance, eco-
nomic value, and social value over the long term.
Hitachi believes that smart cities are essential for a
sustainable future, and is proud to be playing a key role in
this movement. Hitachi's vision for smart cities is being
realized and, even now, Hitachi is engaging with stake-
holders to design and develop smart cities that are good
for the environment, good for the economy, and good for
people. Hitachi expects the benets of smart cities to con-
tinue as long as the cities themselves.
Hitachis Vision for Smart Cities
Seeking the Optimal Balance Among People, Places, Prosperity, and the Planet
Hitachi, Ltd.
Inquiries:
Social Innovation Business Project Division Smart City Project Division
The content of this document is subject to change without notice. If you have any inquiries, please contact your Hitachi sales agent.
Hitachi, Ltd. 2013. All rights reserved.
SCW-E002 Printed in Japan
http://www.hitachi.com/products/smartcity/
Ver.2
2013.9