Italy’s route to innovation starts with smart cities

Italy’s route to innovation starts with smart cities

Italy’s Digital Transformation is well underway as it strives to make its cities smarter. Telecommunications provider, TIM, which is based in the country, is contributing to this development. Supporting its plans is the European Investment Bank as it helps to advance urban regeneration, the redevelopment and energy efficiency of public buildings and the advancement of sustainable mobility in Florence. 

Smart cities lie at the heart of Italy’s digitisation process. The first Italy of smart and sustainable cities report, drawn up by the TIM Research Centre with the ‘Smart City’ and ‘Startup Intelligence’ Observatories of Politecnico di Milano and the CNR Department of Engineering, ICT and Technology for Energy and Transport, was recently presented in Rome.

Pietro Labriola, Chief Executive Officer, together with Elio Schiavo, TIM’s Chief Enterprise and Innovative Solutions Officer, presented the development prospects for Smart Cities in Italy and the digital services that the group provides to the Public Administration and local authorities. 

It emerges that in Italy an increasing number of municipalities have started to plan smart cities and, according to estimates, by 2027 investments in ICT solutions for smart cities will grow to around €1.6 billion, while globally total spending on smart cities will reach a value of over US$1 trillion.

The reason for this is clear. Between 2023-2027, Smart City applications based on 5G, IoT and Artificial Intelligence in Italy will help to reduce city traffic costs by a total of approximately €6.5 billion and those linked to urban pollution by over €400 million through improved planning of the public and private transport system and tourist flows. The new technologies will also allow an annual reduction in CO2 emissions of about 650,000 tonnes, guide the tourism industry and optimise services for the public.

The study analyses different use cases also implemented by TIM Enterprise, the TIM Group’s business unit dedicated to companies and public administrations, which is supporting the projects of many municipalities through the TIM Urban Genius solution, on the model already successfully implemented in various municipalities, including Assisi and Cairo Montenotte, starting with Venice.

“There is a lot of confusion about smart cities, the term is often used as a catch-all and thus risks detracting from the choices of mayors and administrators who play a fundamental role in the innovation of the areas they govern,” said Schiavo. “We are giving cities a tangible thing; a platform for collecting and processing data useful for expanding the economy, governance and sustainability of cities; that’s what a Smart City is. With TIM Urban Genius we have created the first urban intelligence platform allowing Italian administrations to make the areas they govern smart, since it is the primary source for collecting useful information for the lives of the public.”

At the end of last year, the European Investment Bank (EIB) showed its support for the development of smart cities in the country by announcing a €200 million framework loan to support the municipality of Florence’s 2022-2027 investment plan. It said that the planned actions will contribute to urban regeneration, the redevelopment and energy efficiency of public buildings and the advancement of sustainable mobility. Since 1998, the EU bank has provided €1.06 billion to Florence across nine operations.

The signed agreement and the approval of the operation by the municipal council and the EIB Board of Directors opens up financing possibilities for a wide range of other major investments for the city. These include the Smart City plan and climate strategies to improve the city’s resilience to future climate events such as earthquakes and floods.

In concrete terms, the EIB funding will make a particular contribution to improving the energy efficiency of public buildings including schools and sports facilities, redeveloping green areas, public spaces and roads, and promoting sustainable mobility via the purchase of electric buses and the construction of cycle lanes and rest areas. The municipality’s digital infrastructure (such as its fibre optic network) will also be strengthened.

With this operation, the municipality of Florence will have received more EIB concessional financing than any other Italian municipality, enabling it to make major investments in regional development. The best interest rate terms available on international markets mean that the resources provided by the EU bank will enable the municipality of Florence to make significant financial savings. The municipality estimates that it will save over €10 million over the EIB loan’s 25-year term. 

“Big municipalities like Florence play a key role in promoting the climate transition in Italy,” said EIB Vice-President, Gelsomina Vigliotti. “Investments in regenerating urban areas, promoting sustainable mobility and the energy efficiency of public buildings are priorities for the EIB, with a view to making Italy more sustainable and resilient to future climate events. Italy is among the biggest beneficiaries of EIB financing for urban areas, having received more than €12 billion in the last five years. This operation brings EU bank support for Florence to over €1 billion, meaning it has received more EIB investment than any other Italian municipality.”

Mayor of Florence, Dario Nardella, commented: “Almost all EU-funded projects have environmental investments at their heart and this is key for cities because pollution and climate change are increasingly affecting our residents. The agreement will provide us with up to €200 million from the European Investment Bank, a public bank aiming to promote the climate transition and urban regeneration in order to protect the environment. 

“It means that we are a reliable city for public banks like the EIB and that we make use of the EU funds we receive. We have built new schools and redeveloped many public spaces and will continue to do so in the coming years with various major projects, some of which have already begun. These include the Sant’Ambrogio market, the Andrea del Sarto sports hall, the Don Milani school, earthquake-resistant improvements in local schools and many others, such as the completion of the ‘bicipolitana’ cycle network. All of these projects will be carried out using this loan, whose low interest rate will save us money compared to the interest we would pay on traditional bank loans. This signature will enable Florence to continue investing in many sectors.”

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