Urbanisation is now a global phenomenon and presents its own set of challenges as well as opportunities. It is estimated that an additional 2.5 billion people will live in the world’s cities by 2050, and hence it is critical that cities and their suburbs as well as large towns start preparing now to provide sustainable living conditions to their future citizens. Over the next 40 years, as historic urban migration leads to as much as 150% more energy being consumed, the world needs to cut carbon dioxide emissions to half to mitigate the climate change. This means that we need to rapidly transition to a world at least three times more energy-efficient.

The outlook is no different for India, where millions are already migrating to cities and towns in search of employment and better living standards. In fact, India has more than 50% of its population below the age of 25 and it is expected that, by 2020, the average age of an Indian will be 29 years.

It is, therefore, imperative that the world’s largest democracy creates adequate opportunities for gainful employment for its aspirational youth that is backed by technologically-robust and efficient infrastructure. The decision to create 100 citizen-friendly Smart Cities is a visionary step in that direction. Already, work has begun in right earnest for some of these modern-day cities.
Energy and mobility are the twin turbo engines that will lead these transformations, and both will require radical adaptation to meet the demographic and economic growth across the world without further damaging our fragile environment. The key challenge is whether policy-makers and business leaders can harness and combine energy and mobility in ways that maximise their benefits for the environment and drive greater efficiency and economic growth. As we see it, the Fourth Industrial Revolution in energy and mobility systems offers unprecedented opportunity.

To begin with, power generation is becoming a lot cleaner. There is an evident shift towards de-carbonised renewable energy globally, and it is heartening to note that India is one of the countries leading this charge with a stiff yet meaningful target of 175GW by 2022. India’s leading power producers are also working to change their energy mix—currently dominated by coal-based power generation—to renewable sources. We are amid a global evolution towards energy systems that are increasingly decentralised, with energy generated, stored and distributed closer to the final customers on the back of steadily improving storage technologies.

At the same time, digitisation and decentralisation means that utilities can respond flexibly and effectively to consumers-turned-prosumers, empowering them to influence where their electricity comes from and when to consume it.

Besides energy, it is mobility that will drive the paradigm shift in the coming years, and that will make our cities more sustainable and efficient. As electric vehicles become more and more affordable, there are predictions that such vehicles will constitute almost a third of new car sales by 2030.

In addition, ride-sharing continues to surge, with estimates that, by the end of next decade, it will account for more than 25% of all miles driven globally, up from a mere 4% today. Further, we will soon see autonomous vehicles and commercial fleets of electric vehicles integrated as parts of everyday life.

In the future, autonomous vehicles are likely to also cost significantly less per mile than vehicles with internal combustion engines for personal use—by as much as 40%. This, in turn, could also reduce congestion on the roads and traffic incidents.

Clearly, with massive research and development in the electric vehicle space taking place, leading vehicle makers globally are gearing up to launch multiple models of such vehicles in the next few years. In India, too, the government is pushing for electric vehicles to cut down dependence on fossil fuels. Given the right policy framework, an entire ecosystem for electric vehicles can also emerge in India in the next few years, and it must also get integrated in the overall vision for Smart Cities. There are, however, few principles that need to be kept in mind as countries like India make the transition from fossil-fuel-based vehicles to electric.

*Electric taxis and public transportation will have a great impact in reducing carbon emissions. These types of vehicles are driven far more than personal-use vehicles, so commercial and public electric vehicle fleet development should be encouraged.

* Create a wide and exhaustive web of electric vehicle charging infrastructure along highways, at destination points, and close to public transportation nodes. This is critical to make charging stations accessible, convenient and easy to locate, and to promote the adoption of electric vehicles in commercial and private markets. The lack of adequate chargers is the main barrier to the adoption of these vehicles. In India, for example, there were just 353 public charging stations across the length and breadth of the entire country until 2016, of which less than a tenth were fast charging stations. However, a number of companies have either entered or announced their plans to foray into this space.

*The infrastructure should be deployed in combination with grid edge technologies—such as decentralised generation, storage and smart buildings—and integrated in smart grids, while at the same time offering a digital end-to-end customer experience. This will magnify the benefits of grid edge technologies by increasing reliability and efficiency, while reducing carbon emissions.

* While coal-based power generation is the mainstay for several developing economies including India currently, it is critical that charging stations eventually move to renewable energy for charging. Using thermal power to charge electric vehicles will defeat the whole purpose of moving to electric mobility since it will drive up burning of coal and add to pollution levels.

The transformations happening in the fields of energy and mobility are inevitable, influenced by market factors and mega trends that are virtually unstoppable. Their convergence is an opportunity. Businesses have the chance to spearhead it in cities, while policy-makers have the power to promote innovation. On both fronts, the convergence of energy and mobility must be strategic, intentional and guided, if cities and citizens are to receive the maximum benefits.

By Jean-Pascal Tricoire, Chairman & CEO, Schneider Electric