Cloud-based with a Chance of Utility Innovation: One City’s Story

Right in the heart of Silicon Valley, the city of Palo Alto, California seemed like a natural to move toward the Internet-based cloud. Cutting edge is as cutting edge does, right?

And the city’s Cloud First initiative is a big move in that direction. Starting with theater ticketing systems and moving toward billing and communications operations, Palo Alto Chief Information Officer Jonathan Reichental said the “cloudier” the better with most things. It makes cities more efficient and ready to focus on what’s important, he said.

Yet with some utility operations, it’s best to take a cautious, deliberate approach.

“On the utility side, we’ve moving more slowly,” Reichental  told Electric Light & Power in a recent interview. “We want to prioritize carefully. We’ll some obvious things first; easier first, the harder later.”


The city of Palo Alto delivers services to about 30,000 residential and commercial customers, with electric, gas, water, sewer, fiber, trash and drainage departments. Reichental, a native Irishman and long-time techie who began working in the U.S. decades ago, believes that the Cloud First is the way to go. He arrived in Palo Alto five years ago, tasked with the challenge of moving the community ahead on issues of efficiency, reliability and responsiveness.

“I came in with eyes wide open,” he recalled. For, despite the city’s locale within the tech haven, “I knew we were starting at an innovation deficit. It was an old-school way of approaching technology” on the premise that the city needed to own everything from lines to servers and so forth.

Reichental determined that Palo Alto’s data center policy was unsustainable. He wanted to move the city toward the cloud and out of the hardware business. The city kicked it off in 2012 by moving its ticketing operations–it owned several theaters for live performances–onto the cloud.

“We didn’t have to buy anything,” Reichental said. “We just need scanners and vendors.”

Utility operations are a big part of what Palo Alto does.  Some part of that interconnected system needed to move to the cloud, but certainly not all of it, city leaders decided. As everywhere, Palo Alto customers take their utility services personally, and Reichental learned that the operational part of that segment probably needs to stay in-house for the foreseeable future.

“When it comes to the SCADA system, we’ll defer to the experts on that,” he said. “Those are very specific systems, and we’re not messing with those right now.”

Palo Alto has begun shifting other utility services over to the cloud, though. The city is moving its field workers over to mobile technologies such as laptops, smart phones and iPads. And it also is in the process of looking at a cloud-based geographic information systems (GIS) strategy.

“If you have on-premise GIS, some portion of the staff is always focused on making sure the software is up to date, taking care of upgrades and changing hardware,” Reichental noted. “All of that stuff goes away” when hardware responsibilities are shifted to the cloud, he added. “So we can focus on the value GIS actually has”.We can really focus on data quality.”

The city has done cloud-based projects, including a demand-response program with AutoGrid and energy benchmarking pilot with GreenTraks. In the future, Reichental sees opportunities integrated with Palo Alto’s push toward zero-carbon energy use. Nothing can stop the cloud’s advance, although he isn’t ready to throw caution to the wind, either.

“It seems like the train has left the station on this one: We’re moving forward,” the CIO pointed out. “But we look first for easy opportunities. Don’t tackle the hard things first” such as power generation operations or control systems.

Reichental predicts the cloud shift will be a decade in the making, but it’s inevitable for so many data services. You only have to look at Delta Airlines’ scheduling meltdown to see the needs for outside data service and storage.

“Think of it happening in an energy sector,” he warned. “Think about the real impact and meaning to people.”



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