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How artificial intelligence is reshaping cities

by Steve Freedman, Head of Research and Sustainability of Thematic Equities at Pictet Asset Management

Stephen Freedman, Head of Research and Sustainability, Thematic Equities di Pictet Asset Management
Stephen Freedman, Head of Research and Sustainability, Thematic Equities di Pictet Asset Management
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How artificial intelligence is reshaping cities

Artificial intelligence (AI) and big data are transforming the way cities tackle environmental, social, and economic challenges. These innovative technologies are being used to predict resource demand, manage urban traffic, respond to natural disasters, and improve citizens’ quality of life. However, to unleash their full potential, it is crucial to overcome informational barriers and integrate public and private data sources.

Success stories: Copenhagen, Barcelona, and Singapore

The Danish model: Copenhagen and thrive zones

Copenhagen exemplifies the use of AI for urban sustainability. Partnering with Google, the city maps air quality at street level, providing actionable data for urban planning and anti-pollution policies. Thrive zones, interconnected neighborhoods away from polluted areas, showcase how AI can enhance urban living. Additionally, optimizing energy consumption in public buildings has significantly reduced costs and carbon emissions.

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Barcelona’s water management innovation

Barcelona leverages big data to manage water supply, predict consumption, and optimize wastewater treatment. This technology helps meet population needs effectively while minimizing waste, offering a replicable model for other cities.

Singapore: a digital pioneer

Singapore has demonstrated the value of AI in traffic management and emergency response, particularly during the Covid-19 pandemic. Through digital contact tracing and innovative solutions, the city improved public services and aims to further integrate AI into strategic sectors like biomedicine and finance.

Environmental and social risks of advanced technologies

Despite their benefits, AI and data expansion pose significant environmental risks. Data centers, essential for processing information, are increasing their ecological footprint by consuming vast amounts of energy and water. According to the International Energy Agency, global data center energy consumption may double by 2026, further straining natural resources.

Cybersecurity threats are also on the rise. Hacking attacks can paralyze critical infrastructures, causing widespread disruptions. Additionally, data quality and management remain problematic: advanced algorithms often generate volumes of information difficult to interpret without proper expertise.

Towards a sustainable and smart future

With over half the global population living in urban areas, cities must adapt to meet increasing challenges. Investing in AI and big data will not only improve public services but also unlock new economic opportunities. Initiatives like the Pictet-SmartCity investment strategy aim to identify companies contributing to building more sustainable cities, turning these challenges into opportunities.

Share your thoughts! What role do you think AI will play in the cities of the future? Leave a comment below!

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