From solar panels to parking sensors: Two-thirds of local self-governments plan to introduce smart solutions

In Serbia, four out of five local self-governments are familiar with the concept of a smart city, often associating it with the use of modern technologies and innovations aimed at improving the quality of life for citizens, as shown by research conducted by NALED within the StarTech project. The findings also indicate that more than half of municipalities have implemented projects with innovative solutions, ranging from the introduction of LED public lighting and installation of smart benches for charging electronic devices, to audio-visual sensors at traffic lights and solar energy in residential buildings.

Despite understanding that smart solutions enable better services tailored to citizens, more efficient local management, and cost reduction, local self-governments lack a strategic approach for their development and funding for implementation. Additional challenges include underdeveloped infrastructure and a lack of expertise in innovations. Local governments see the greatest potential for implementing smart solutions in areas such as municipal services, infrastructure, as well as environmental and traffic management. However, citizen participation in defining the problems for which smart solutions are created locally is assessed as low.

Despite these challenges, 65% of local self-governments plan projects with elements of smart cities, focusing on improving the functioning of municipal administration through further digitalization, enhancing energy efficiency and traffic safety, wastewater treatment, introducing remote meter reading for water consumption, as well as installing special sensors for disabled individuals in parking lots and solar panels on private and public buildings. Such plans require regulatory adjustments.

- Since the concept of a smart city is not legally recognized, we propose amending the Law on eGovernment to include it and envisage the adoption of a separate regulation to regulate the methodology for the development of smart cities in Serbia. Smart solutions often involve collecting and analyzing a large amount of data, as well as using sensors, software, and applications, so it is necessary to strengthen mechanisms for protecting privacy and data collected, by aligning future legal solutions with the Law on Personal Data Protection and the Law on Information Security, emphasizes Irena Đorđević Šušić, Head of the Digitalization, Innovation, and Entrepreneurship Unit at NALED.

In addition to regulatory recognition and regulation, defining a strategic approach through the Smart Cities Development Program in Serbia is important, serving as a basis for adopting similar documents at the local level. Furthermore, the financing process for smart solutions should be regulated to ensure that the development of smart cities is not reduced to project support and to ensure the sustainability of these solutions. Sustainability can also be promoted through inter-municipal cooperation, where local self-governments work together on developing and financing smart solutions, establishing a Smart City portal, as well as through greater citizen involvement in identifying key problems that need to be addressed with smart solutions.

The research also covered support for innovations and innovators at the local level, where there is also considerable room for improvement. Only 12% of municipalities have an organizational unit or person responsible for innovations. Innovations at the local level are mainly financed from state funds, just over half from the city budget, while every other local self-government uses EU funds. Only one-fifth of municipalities allocate a separate part of the budget for innovations, usually amounting to 1-2% of the local budget.

- Therefore, our recommendation is for local self-governments to allocate a separate part of the budget for innovation development and create local programs to support innovators. It is necessary to strengthen the capacities of the public administration to support innovative entities, as well as models of cooperation between municipalities and research organizations, concludes Đorđević Šušić.

The research "Challenges and Innovative Solutions of Smart Cities at the Local Level" involved 49 local self-governments. StarTech project was launched in 2020 by Philip Morris company and NALED in cooperation with the Government of Serbia to jointly support the development of innovations and digital transformation of small and medium-sized enterprises in our country.

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