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David Crane writes on innovation policy. He can be reached at

We need to become much more innovative in how we think about innovation. This means putting side our too-frequent Canadian risk aversion and thinking big instead. It means seeing needs as opportunities.

The United States is doing just this right now with its Smart City competition. It's offering $40-million (U.S.) to the mid-sized city (population between 200,000 and 850,000) with the best proposal to radically advance transportation using digital technologies, autonomous vehicles and connected vehicles. Although the challenge was just launched last December, more than 75 cities have responded and the five finalists will be announced next month, with the winner named in June.

The prize amount is big enough to make a difference to a single city. In effect, the winning city will serve as a research-and-development and demonstration project for the companies that help design and build it. To support the initiative, Microsoft Corp. co-founder Paul Allen is putting another $10-million on the table for the project.

Why can't we do something like this in Canada? Smart City is a way to come up with new solutions for the traffic and transportation needs of growing populations. More and more Canadians are being crowded into a small number of metropolitan regions where there are already severe and costly congestion problems. With fast-expanding electronic commerce, local parcel delivery systems may soar, while vehicles on demand may replace personal ownership of cars.

We should use this big boost of infrastructure spending planned by all three levels of government as an opportunity to build next-generation infrastructure, recognizing the potential of wireless and sensor technologies, as well as the urgency of moving to a low-carbon world.

Such a move would create opportunities, encourage entrepreneurs to show their stuff and gain the advantage of building new systems at home that we could demonstrate, and sell, to the rest of the world.

Infrastructure systems and smart land-use planning will be in demand all over the world in the years ahead, as the global population grows and hundreds of millions more move into metropolises. That transformation will require smart technologies for clean water and sanitation systems, intelligent traffic systems, connected and autonomous vehicles, efficient, safe and reliable public transit, public safety, clean power and smart buildings, including affordable housing.

When we succeed in solving problems at home, we will have something to sell to the rest of the world. This applies not just in our cities – if we can develop easy-to-maintain safe water and sanitation systems for aboriginal communities, we can sell the same technologies in Africa, Asia and Latin America.

Congestion is already a big challenge in our major cities. Take Ontario, where a government report forecasts that the province will have about 3.7 million more people by 2035. But almost all of that population growth will be in the Greater Toronto Area and the great urban corridor stretching across Southwestern Ontario. Two-thirds of Ontario's population growth is expected to occur in the GTA alone, bringing its population to 8.8 million by 2035 – 51.4 per cent of the province's population.

The U.S. Department of Transportation says it "wants to show what is possible when emerging data and intelligent-transportation technologies and applications are integrated with existing systems." It wants cities to look at incorporating urban automation; connected vehicles; intelligent, sensor-based infrastructure; urban analytics; urban delivery and logistics; and smart-grid systems, among other things.

This competition is not the only way the United States is pushing new technologies in cities. President Barack Obama's administration's latest budget submission contains a program to spend $3.9-billion over 10 years to "fund large-scale deployment pilots to test connected vehicle systems in designated corridors throughout the country."

Ontario, after much dithering, has finally taken a first step to at least allow limited use of autonomous vehicles. But this is a far cry from a strategy for next-generation transportation. Unless we can start thinking bigger, we will still be debating our poor innovation performance a decade from now and our entrepreneurs will have lost many opportunities for jobs and wealth creation in Canada.