Politico.com

Dim Lights, Smart City

2015-11-20

The come-hither look of any major city has always been its incandescence. Lights that never turned off were the hallmark of a city too vital to sleep. A city with a dark downtown was a city whose sidewalks rolled up at night and that was a city that was dying. For a city like Charlotte, with big ambitions but a relatively modest urban core and a propensity for sprawl, leaving the lights on was a bit of conspicuous consumption that no one blinked at in the boom years. But the financial collapse, soaring energy prices and a stalled economy forced a rethinking of the city’s priorities. Nobody wanted to see Charlotte lose its hard-won standing as a capital of the New South, so city leaders—at the urging of its most prominent corporate citizens—started thinking about what would jump start the economic engine and keep it humming.That quest has led Charlotte to a surprising conclusion: that the classical allure of the city at night might be a problem to avoid, not a quality to embrace.This counterintuitive notion is the foundation of Charlotte's five-year-old master plan to transform North Carolina’s largest city into an urban beacon of energy thriftiness. It's called Envision Charlotte, a non-profit that leaders of the city's largest corporations like Duke Energy are betting will position Charlotte in the urban vanguard of environmental sustainability. If it works, Envision Charlotte will rekindle growth that in the best of times reached 10 percent annually. The program leans heavily on data to guide its conservation choices, and that means more than just turning the lights out at night but controlling waste and water usage. It has already earned praise from the White House, which has chosen it as a national model. But it’s too soon to tell whether it has done more than appeal to policy wonks and has actually turned the heads of young people on whom the city is depending to help it grow.The appeal of restraint over blinking neon promotion is a hard concept to explain, so Amy Aussieker, who leads Envision Charlotte, finds it helpful to employ a little story. The tale emerged in the course of some rather tedious data analysis of electricity consumption in Charlotte’s business district. Amid all the charts that showed the downtown’s kilowatt consumption tracking natural workaday appetites, one office stood out as the site of an unusual daily feeding frenzy.“Every day at 10 a.m., there was a huge spike,” Aussieker says. Later in the day it would drop back down. The following morning it would like someone was gorging on the all-you-can-eat fossil fuels buffet. And then, just as regularly, it would return more or less to normal.“It turned out,” says Aussieker, “that there was an old, possibly overweight and high-blood-pressured CEO who had wanted the air conditioning lowered every day for his morning meeting.” As it happened, the executive who liked his conference room morgue-cold was long gone. His carbon footprint, however, lived on.For Aussieker, the parable of the big-bellied banker is a lesson in the power of a single data point to drive sweeping change. But it speaks volumes, too, about the lengths to which Charlotte has been willing to go to make itself a comfortable place for companies to do business. A city of more than three-quarters of a million people, Charlotte is in many respects the invention of a handful of CEOs, who imagined an urban experience attractive enough to lure aspiring young professionals for whom New York and Chicago might have seemed the only sensible places to launch a career. Their vision succeeded to such a degree that Charlotte ranks second behind New York among American banking centers; one in 20 adults in Charlotte's home county works in the financial sector. Aussieker, with brown flowing hair, a white top, and black blazer, is telling her story in the 7th Street Public Market, a industrial-style food hall like those that have sprouted up in recent years cities like New York City, Washington D.C. and Philadelphia. What’s on offer here in this converted old grocery is a North Carolina version of the hipster havens that abound across the country: craft beer from Birdsong Brewing Company, pizzas with locally-sourced country ham and scores of homemade hot sauces. These—along with a couple of professional sports franchises—have become the standard trappings of a vital modern city. But Envision Charlotte’s twist is predicated on matching wits with the legions of young professionals who expect their adopted cities to as act as smart as they look. And these days that means behaving like the future of the environment matters at least as much as the next quarter’s earnings report.***Charlotte, says Michael Smith, president and CEO of the downtown alliance called Center City Partners, has long been “an aspirational place.” It’s getting near the end of the day as we sit in his group’s offices, on the 16th floor of a building that looks out over the business district, which in any other city would be called downtown, but in Charlotte is known as Uptown. Anchored at the intersection of Trade and Tryon Streets, a former Native American trading post, the area is higher than the rest of city center, but the name was also part of a marketing push in the 1980s meant to give the up-and-coming city a veneer of both glamour and positivity. Down below, the general hope among the people starting to fill the streets is that the Carolina Panthers can continue their unbeaten streak with a Monday Night Football win over the Indianapolis Colts.But designing for the future in Charlotte, Smith says, has sometimes come at the expense of its past. Smith is crisply pulled-together: a purple checked shirt and complementary purple tie, topped with a dark-gray blazer. But he allows his head and shoulders to droop as he says, “We went through a period where we knocked down so much of our history.” Some of that indeed happened right here in Uptown. In a 1960s urban-renewal push, a section called Brooklyn, home to black-owned businesses and homes, was razed. The area today is filled largely by government buildings, but it is still a a psychic scar for some in Charlotte.The trade off was that Charlotte, however surprisingly, emerged as one of the world’s great banking towns, a capital of the New South that its corporate leaders hoped a young professional from, say, New York or Chicago, might be willing to spend some time in. After the Great Recession of 2008, though, Charlotte has had to rethink its dependence on a single sector to sustain it. So the city is depending on Duke and companies like Mitsubishi and Siemens that have set up shop here to work with it, in the hope of at least making it a banking-and-energy town. And they’re looking at how they might attract a bigger pool of young professionals, in part but making this something of a paradise for the city-loving sports fan. A walk and drive through Uptown just before the Panthers take the field reveals bars packed with fans in blue and white jerseys and an abundance of elaborate tailgating . Throw into the mix that the Charlotte Hornets of the NBA moved to Uptown in 2005, and that the Charlotte Knights, a Chicago White Sox AAA affiliate, have played here since 2014. There’s also the fact that the weather’s good and both the beach and the mountains are nearby. The city is manageable and appealingly well-scrubbed but, says Aussieker, “If you want to hang out with trust-fund kids with beards, Asheville’s two hours away.” Already, one in three Charlotteans is a youngish adult, aged between 20 and 34—fewer than college-town Boston, on par with major metros like Los Angeles and New York—but the city wants its young population to grow. And it is willing to adjust to get them here. And that is where Envision Charlotte comes in. It’s the brain child, largely, of Center City Partners’ Michael Smith, who, after some initial experimentation with a local company called Intelligent Buildings, approached Jim Rogers, then CEO of the energy behemoth Duke Energy, in 2010 with the thought that perhaps there was something Charlotte could do to design itself into a more forward-looking city by tapping its urban architecture and energy expertise. Rogers ran with the idea, and Envision Charlotte was born. Only months later, Smith, Rogers, then-Mayor Anthony Foxx, and John Chambers, CEO of the technology giant Cisco Systems found themselves walking out to join Bill Clinton on stage at the Clinton Global Initiative gathering that fall. Clinton consulted his notes, and then shared with the crowd that this was a city up to something special. Energy efficiency in the United States has largely been a residential affair, said the former president. But Charlotte was going to try something different. These business leaders, and Foxx, would throw their considerable resources and energies into rethinking where Charlotteans work. Clinton smiled, open-mouthed, and said, “It’s a pretty good deal to me.”***The deal was a good one for the corporate partners, too. Using a combined $5.3 million from Duke, a company that made $2.7 billion in 2013, and Cisco, Envision Charlotte targeted the energy consumption of the city’s commercial buildings over 10,000 square feet – 61 of them, all clustered in Uptown. Buildings of that size produce vast quantities of data, but few people ever look at it in a holistic way. Envision Charlotte would not only look at the numbers, it would find ways to act on the data and, it hoped, reduce energy consumption 20 percent within an eye-poppingly short horizon of five years.In terms of getting cooperation from the building managers it helped that much of that real estate was controlled by the city’s biggest corporations.“When you get the leaders of this community saying, ‘You’ve got to do something,’” says Aussieker, “pretty much everyone falls in line.” That’s not the way most cities do it, to be sure. New York City, for example, has legislated that big buildings must disclose a baseline of their water and energy usage. That way of doing things – call it the Bloomberg model in which a powerful and agenda-driven mayor rules by governmental fiat—wouldn’t fly in Charlotte, I’m told. It’s not an accident that the top elected official here is only part-time. Mix in simple questions of size; together Duke Energy and several major banks control more than 11 million square feet of real estate in Charlotte—or about 10 times that of the city and surrounding Mecklenburg County. Robert Phocas is the energy and sustainability manager for the city of Charlotte, and a partner in Envision Charlotte. “I saw this as a way of leveraging the work of others.” He adds, “I’ll go to conferences and hear stories from people from places like Boston or Chicago about mayors who just do things and people are expected to follow. It’s antithetical to Charlotte. Our process isn’t as direct.” Aussieker explains the value of the business-first model by relating an urban innovation that has run into trouble in another city. In Houston, she says, they’re trying out a new plan to recycle trash into new products right at the garbage collection station instead of trucking it to other facilities. The haulers, not surprisingly, aren’t thrilled. The politicians and policymakers, are, as she sees it, starting to go wobbly in the face of that opposition. And when you’re trying to change the long-standing, often entrenched ways a city operates, a little fortitude is necessary. Focusing on a small part of such a big town, says “smart cities” expert Anthony Townsend, is sound strategy. Townsend, a visiting scholar at New York University’s Rudin Center for Transportation Policy and Management, as well as the author of th e2014 book, Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia, says that a district “is kind of the sweet spot between a single building, which doesn’t really demonstrate anything beyond the commitment of a single building operator, and an entire city, which is too much to bite off in a reasonable time frame.”Of course, points out Townsend, getting people to rally behind a fairly small, relatively costless energy-conservation project is easier than getting them to commit to investing in overhauling a whole city to be “smart.” Still, Townsend says, “it shows they’re thinking about the future, which you’d think everyone would be doing, but it’s in short supply.” What’s more, he says, “Not understanding how buildings perform in real conditions is a real obstacle to making them more efficient,” he says.But the program’s ambitions don’t stop there. Envision Charlotte is already looking beyond energy to change how Uptown engages with other things elemental: water, waste, and, eventually, even the air that swirls around and through its buildings.Charlotte’s major corporations may have had little difficulty launching the Envision project, but its success has rested almost entirely on the shoulders of the people working in the buildings. Crowd psychology as much as any corporate communique has been the deciding factor. ***In 2011, Tidy Street in coastal Brighton, England, boasted something unique in all of the United Kingdom: a massive chart painted down the middle of the road. The chart’s five hundred lines showed the electricity usage of residents who had typed their meter reading into a website. It pegged their consumption against the city of 155,000 as a whole. The three-week experiment, memorialized in the film “Urbanized,” was said to have reduced energy consumption on the street 15 percent. Said one Tidy Street resident, “It wasn't really so much about the numbers as it was where your wiggly line is going in relation to the street's wiggly line.”There’s research to back the idea that however useful it is to simply show people statistics, it’s a desire to conform that packs real power. In 2004, a professor at Arizona State named Robert Cialdini and Cal State San Marcos’ Wesley Schultz researched the use of door hangers in San Diego. The message that reduced energy use the most wasn’t about saving money. Or the planet. Or even your kids. “Summer is here and most people”—emphasis on most people—“in your community are finding ways to conserve energy at home.” Indeed, it’s the desire to keep up with your neighbor that, say, gets you to decide to set the AC to ‘chilly’ rather than ‘make-your-teeth-chatter frigid.’ Envision Charlotte learned that simply sharing data is not enough to change behavior. Take the touch-screen kiosk displays that were meant to be an eye-catching attraction letting Uptown workers know just how much energy they’re gobbling up. But on a recent fall day, a guard in own of Uptown’s landmark office towers has found that it’s just the right height to lean on. In an interior mall of sorts next door, lunching office workers walk by the display without so much as a glance. As I stand watching, it goes into energy-saving mode, and it’s tricky to wake it back up. Not so successful, either, was a six-week ‘flip-flop’ game spearheaded by Duke, as part of a push to get workers to single out coworkers who were particularly good energy savers. Their reward for flipping off light switches: a tiny piece of beach footwear. Cute idea, but it didn’t have legs. Shame, it turns out, is a much better motivator. You might not know that some species of crabs are attracted to light, which is why crabbers use flashlights when they’re trying to fill a bucket. So Envision officials dispensed red plastic crabs to Uptown office workers, encouraging them to deposit the crustaceans on the desks of colleagues who left at night without turning off their desk lamp or powering down their monitors. “People,” says Aussieker, with a laugh, “like punishing their neighbors.” Other approaches were a little more straightforward. Building managers were instructed that it’s not a good idea to have their building as well-lit and temperate at 1 a.m. as it is at 1 p.m. After-hours cleaning crews, often the only people in the buildings over night, were trained to illuminate only the floor they’re working on. Office workers were taught to hunt for “vampires,” or devices like plugged-in even when they’re at rest. In just five years, the group says, energy consumption in its targeted buildings dropped 16 percent. Shy of the goal it had set, but enough to save building operators some $17 million. Last year, Duke Energy wrapped up its hands-on work with Envision Charlotte. Somewhat confusingly, it declared a significantly lower energy reduction of 6 percent, factoring in only behavioral tweaks it introduced (and excluding the company’s own properties). But that doesn’t mean Duke is disappointed with the program. Quite the contrary. It has actually made money from helping its customers use less of its commodity. (The company is offering a product called “Smart Energy in Offices,” aimed at somewhat smaller clusters of at least three buildings, available throughout the Carolinas.) Aussieker says that when she was brought on to turn Envision Charlotte from an initiative into a fully-fledged non-profit, she wondered, “Why is Duke Energy, which sells me kilowatt hours, trying to sell me less?” Sitting in the 7th Street public market, we’re just steps from Tank’s Taps, a craft beer bar Aussieker co-owns. Her question sounds analogous to her establishment trying to discourage its customers from ordering more pints of its delicious IPAs. The next day, I ask Kevin Franklin to explain. Franklin is Duke Energy’s director of customer facing operations. Sitting in white leather chairs in the gleaming lobby of the Duke Energy Center—under lights that adjust to the daylight streaming in from the street-level windows—he flips over a sheet of paper he’s been holding and sketches out a formula that explains the counterintuitive. “It’s an incentive for us to be successful in encouraging our customers to use less of our commodity.”States that want to encourage their utlitities to help customers conserve have had to find creative ways to keep the utilities profits steady as usage declines and to motivate the utilities to continue to exert their considerable influence to drive down consumption.North Carolina’s solution is the equation on Franklin’s piece of paper. Under an agreement with the state’s regulatory commission, Duke Energy gets back, through future rate adjustments, what it spends on its efficiency work. In simple terms, for every dollar it spends on, say, handing out better light bulbs, training local “energy champions,” or giving building managers online dashboards for energy consumption, it gets a dollar back. That money comes from a slight increase in the per-kilowatt-hour rate paid by customers across the state. “Truing up,” it’s called in utility speak. But there’s also a bonus Duke can make through a so-called “shared savings” program. If a customer saves, say, two bucks on energy costs as the result of a dollar Duke spent educating him, the company gets a slice of what wasn’t spent, somewhere in the neighborhood of 10 percent. That sort of mechanism can raise hackles. Some Tea Party-affiliated advocates in North Carolina, as in other states, have objected to the idea of the public subsidizing an unproven, top-down “clean energy” push. Conservatives in the state have called for a total rollback of North Carolina’s energy efficiency standards. At a recent "Free the Grid" event organized by the Koch Brothers-backed Americans for Prosperity, a Republican state representative declared, "Tonight you'll see how egregious North Carolina is about wedging its way into your wallet by force."But Duke today falls back on something that Jim Rogers, its former CEO, was fond of saying: “The cheapest power plant is the one that you don’t build.”***Dr. Robert Cox crooks his hand. Sitting in his office here at the University of North Carolina at Charlotte’s red-brick and water-cooled Energy Production and Infrastructure Center, the professor of electrical engineering is showing me how one goes about mounting an ultrasonic sensor in an alleyway trash receptacle.What’s the point? To figure out what kind of and how much garbage is stuffed inside it, the same way you use radar to look for a submarine under the sea. His students went so far as to climb inside and deploy their protractors to get the angles right. But still, things turned out messy—flying trash bags tended to bend the sensors out of whack.“It’s a dumpster,” Cox says by way of acknowledging he’s not working in exactly lab-quality conditions. “There are all these little issues where getting data isn’t all that easy.” Cox and his team stepped in when Duke Energy stepped back, and he is now the beneficiary of a stream of measurements that updates every 15 minutes, thanks to meters placed in each of the participating Uptown buildings—on how much energy this slice of Uptown is using. As a researcher Cox says he is happy to have that mass of data at hand. That’s only half the battle, though. “The question that everybody has is, ‘Once you have the data, what the hell do you do with it?’ How to use data well is the huge challenge right now.”Contests like the red crab game are fun, but Cox and his colleagues are looking for long-term solutions that can be woven into the fabric of daily life. Working with a major Charlotte bank in some of its properties, they tried out a tool from the Netherlands called Plugwise, which allows users to track, via a web-based interface, how much electricity their devices are using. That sort of technology is popular in Europe, where consumers have learned that electrical kettles used for making tea are greedy power consumers while their big-screen TV isn’t so bad. “Everybody in Holland has one of these in their house,” Cox says, and they use it to stay on top of their energy use. But he found he couldn’t get much traction with it here in Charlotte. Still, he’d like to test whether that sort of data awareness might be more effective when its comes to Envision Charlotte’s other pillars – water, waste and air. “With energy, no one knows what a kilowatt hour (is),” he says, “but everyone has an idea of what a pound of trash looks like.” But another lesson of Envision Charlotte has been that even when the data are perfectly clear, we’re imperfect creatures, or at least ones with competing interests. Take turning off a computer at the end of the work day. That’s a fairly simple energy saver, says Cox, but it smacks into something into a contradictory directive workers often have been told. “I.T. departments want to put out a security patch whenever they want, which might be at three in the morning.” Building engineers, Cox has found, consider tweaking—and, often, rendering useless—air-conditioner efficiency settings part of their design rights. Even building managers who might want to think more responsibly would prefer not to have to tweak the thermostat every time they get a “hot-cold call” from an occupant complaining he’s uncomfortable, says Cox. One thing that has proven successful is face to face contact between building owners and Cox’s students at UNC Charlotte’s Center for Sustainably Integrated Buildings and Sites (a subprogram of EPIC, Cox’s home program. The students are trained to audit buildings for efficiency, spotting problems and possible opportunities to more finely-tune buildings, even ones that are humming along.Part of the appeal, Aussieker admits, is that the students are “free labor.” But perhaps a bigger selling point is that the “smart cities” field is rife with vendors spouting jargon (“The-Internet-of-Things-enabled infrastructure!” “Intelligent traffic!” “Data-driven real-time enforcement!”) These public university students, meanwhile, aren’t in a position to sell building managers and owners anything. They can instead simply be guides through the thicket. ***Building operators are saving money and Duke is managing to make money, but the question remains: Will Envision Charlotte achieve its larger goal of luring those bright young professionals smitten by its “smart city” cred?Hard to say, but for now, the city is riding some good reviews.Before the banking collapse ground construction to a halt, Charlotte had been adding population at a remarkable pace, a growth manifested in a spread outward. The city of Charlotte is 300 square miles, which is massive—more than 10 times the footprint of Miami, for example. Shannon Binns is the executive director of a transportation and land use-focused group called Sustain Charlotte. “When I moved here in 2007 or so,” he says by phone, “Charlotte was really the poster child for urban sprawl. We were just building further and further out.” It might appear odd, at first glance, for a group with “Sustain” in its name to cheer an effort led in part by the local energy company, but Binns calls Envision’s focus on developing the potential of Uptown “fantastic” and “absolutely aligned” with his organization’s vision for Charlotte. “If we can invest in our current footprint, and build more up than out,” he says, “we can really move the needle.”That said, the districts that urbanists tend to be paying attention to today are brand new, like South Korea’s Songdo, the wifi-and-sensor-equipped walkable city being built on the outskirts of Seoul, or Stockholm’s Royal Seaport District, a 230-acre development coming into shape as a showcase for sustainable construction. Charlotte, meanwhile, was settled in 1775, but unlike some of the East Coast’s other major cities it lacks the sort of legacy architecture that can be immensely difficult to upgrade – an unintended benefit perhaps of its old habit of plowing under the past to build the future. And don’t underestimate the power of a snappy logo. Envision has placarded all its participating buildings with an undulating flag with fields of blue and green fields. “Millennials say, ‘I want to work in building like that,’” Cox says. Michael Smith of Center City Partners echoes him: “We really think there’s a connection between places that care and the people who choose to live their lives there.” Townsend, the researcher and smart city consultant, is somewhat less sure that smart buildings alone are enough to determine people’s major life choices, but he’s willing to go so far as to say that evidence of an embrace of smart-city thinking might help keep Charlotte ‘on the list,’ whether that’s of a company willing to relocate or of a new college graduate choosing between Charlotte and somewhere else. ***The biggest endorsement of all may have come from 400 miles to the north. Dan Correa, a senior policy adviser in the White House’s Office of Science and Technology Policy, and its point person on smart cities, sees lessons in Charlotte. They seem to have figured out a roadmap for creating change, he says, “in a city where policy is not going to be the driving factor in accomplishing city-wide goals.” Says Townsend of the White House’s interest in Charlotte, “When they say they’re going to be using the city as a lab, that’s to be taken seriously.” Envision America was announced at the first-ever White House Smart Cities Forum in September. Aussieker had just a few months to rally a slate of companies (like Microsoft, the mapping company ESRI, and the smart grid company Landis+Gyr) willing to pay Envision Charlotte $25,000 to get paired with cities—whose pitches were honed by consultants offered by Aussieker—that want to pursue a goal such as reducing the number of cars in downtown by 15 percent. Aussieker says she’s already heard from cities like Philadelphia, San Antonio, and—in an event that floored her—New York City. Over the three days, Envision Charlotte will attempt to share the lessons that it has learned over its five years. Some are nuts-and-bolts: try, for example, to get buildings to sign disclosure agreements in one go, rather than asking for energy data and having to go back and ask again when you want to measure water or waste. And some are bigger picture, like how critical it can be to have someone, like Envision Charlotte, to act as a neutral convener, especially when you’re aiming to pull off what she calls a “private-public-plus” approach. The University of North Carolina will talk about the benefits of tapping local universities. The White House will bring in federal agencies with funding opportunities. Professional facilitators will run the whole show. “The city leaves with an actual roadmap,” Aussieker says. I ask Aussieker if she gets that some people might find it funny for the White House to be championing what might look like a pay-to-play vendor-matching event. Sure, she sees that, she says. But for one thing, the costs of flying everyone in are minimal compared to the level of financial support—$600,000 annually—local leaders have put behind Envision Charlotte. Not pursuing unconventional ways of running a city just because they’re new, and perhaps slightly uncomfortable, means leaving possible solutions on the table.In January, when the Envision America event comes to UNC's campus in Uptown, bringing at least one White House representative and hundreds of other smart-city devotees, Charlotte will bask for a few days in a spotlight it has earned for turning its lights off.