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Smart cities are the key to a sustainable future

A new report highlights how AI, Earth Observation and other emergent technologies will enable better resilience, productivity and quality of life in our cities.

Rhiannon Edwards


By 2050, 2.5 billion more people globally will live in urban areas.(1)  With cities already accounting for 70% of all emissions globally (2), the development of smart urban centres has become an urgent priority: one that also represents a big opportunity.  

Both the public and private sectors will be agents of change for our future cities. And both are already embarking on radically rethinking how we create city environments that work better for human beings, while actively securing the future of our planet.

Research by Intesa Sanpaolo identifies three themes – resilience, quality of life and productivity – that will serve as the foundation for future cities, shaping everything from how our buildings work to how we protect ourselves from disease.



Greater resilience in cities is a priority. This means powering cities through green energy, a transition which is already under way. 

But resilience is also to be found in the details of how our cities work. Here, circular economy approaches to production – that promote local manufacturing, sharing and resource reuse – are one of the biggest changes we will see over the coming decades. 

One example is designating our city buildings as repositories of valuable resources to enable decarbonisation. 

This would mean that the materials currently in our buildings would never leave the construction industry. Instead, as buildings come down and fall out of use, they would be reused for future construction projects. 

Known as buildings as material banks (BAMB), this is a key growth area with a steep curve – the global market, valued at $438m in 2022, is set to reach $3.6bn by 2030. (3)

A further example of change for resilience focuses on another key component of our cities: food supply. 

Here, controlled-environment agriculture (CEA) and vertical farming offer sustainable alternatives to conventional farming techniques, enabling cities to reduce their water use and their carbon footprints. 

Hydroponics will power CEA systems and will grow in market share in the near future. Compared with aeroponics and aquaponics, it held the highest share in the global vertically farmed produce market in 2022 in terms of volume and value, with 63% and 61%, respectively. (4)


Quality of life

Improved quality of life for people is a key focus of future city development. Arup conducted a survey in 2021 that used the 15-minute city concept to roughly assess a number of cities’ “liveability” by asking respondents how much time they needed to travel to reach essential services. 

Cities that provide amenities within 15-20-minute walking or cycling distances are creating greater resilience and improved quality of life as well as increased productivity. (5)

Although they still have work to do, European cities are already among the most amenity-dense in the world, offering good and rapid accessibility. 

Cities elsewhere are involving citizens in city design by promoting active participation and collaboration between planners and residents. 

Examples include Melbourne, Australia, which introduced Plan Melbourne 2017-2050 to drive city growth.

The plan has introduced new bike lanes for greater citizen mobility and health, and includes a strategy to develop 20-minute neighbourhoods. 

In China, Chengdu has launched its Great City plan as a model for how the whole country could rethink and redesign its suburbs. It emphasises the development of areas around the city’s periphery that can provide essential services within a 15-minute walking distance.

Cities are deploying digital technologies to promote citizen health through increased direct intervention and preventive measures. 

Following Covid-19, Earth Observation (EO), enabled by the emergence of small satellites which weigh less than 500kg, is helping epidemiology. 

Historical data, satellite-based imagery and statistical relationships can help health professionals analyse disease dynamics and distribution across our urban spaces.

Uptake of EO satellite use is being driven by the declining cost-to-orbit. This declining cost is itself due to circular-made, modular launch vehicles that reuse materials, as well as advanced sensing technologies.



Increased productivity in cities will rely on artificial intelligence. AI is able to monitor cities in a never-before-seen way, and optimise how they work through data-driven decision-making.

For example, AI is impacting the way in which the built environment is heated and cooled, with the internet of things shaping heating, ventilation and air-conditioning systems (HVAC).

HVAC can account for 40% of a building’s energy requirement, so this obviously is a key area for optimisation in our cities. (6)  

AI is able to produce much more reliable carbon tracking and accounting too, which is the start of better resource use. The global market for emission monitoring technologies in cities was valued at $350 million in 2022 and will reach $1.5bn by 2030. (7)

Dijon is one of the first cities to track carbon dioxide emissions in real time by deploying a network of ground-based probes, while Turin is exploring the potential of satellite imagery to generate indicators that enable smart and sustainable urban development.

Overall, future cities will provide a higher quality of life for their people, driven by technological advancements and a thoughtful approach to how our cities are planned and work.

Source: Document Sustainable cities (.pdf)
(1) Page 8
(2) Page 10
(3) Page 39
(4) Page 29
(5) Page 9
(6) Page 52
(7) Page 13

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