The Future of Infrastructure

Up until very recently, the shift away from traditional office design towards more dynamic workplaces and work habits which promote wellbeing has felt relevant only to certain types of organizations, agencies, workers, and geographies. The coronavirus pandemic changed that almost overnight.

As a consequence of stay at home orders around the globe, many employees and organizations were thrown into working in a completely different way. Remote working became the norm and office buildings stood empty. Amidst the continued disruption, organizations and their people are demonstrating agility, resilience, patience and understanding to make sure work gets done.

The future of work that we predicted has been accelerated, that future is now. Our experts have come together to explore some of the biggest shifts, their impact and implications, so we can prepare for a holistic Future of Work where people and places thrive.

Infrastructure has an important role in helping the world recover from the economic hardships of the coronavirus pandemic. Although governments around the world are rightly focused on immediate needs regarding health, hunger and staving off economic collapse, preliminary work has started on the next phase of the recovery. To restore business and consumer confidence, stimulate investment and create jobs, stimulus packages are underway.

When making choices about what projects to support, decision makers should consider economic, social and environmental outputs. As well as helping industries hurt by the shutdown, recovery plans are likely to include investment in key sectors such as transport, telecoms and hi-tech, health-care and clean energy.

As we look to the future, practitioners have a responsibility to anticipate the changes underway, no matter how unpredictable the world may seem right now. Given the severity of this crisis, we have a duty to ensure the infrastructure we build stands the test of time.

Coronavirus has unleashed profound changes that will have a lasting impact on our world. We can be certain that there will be no return to pre-pandemic norms - even when the medical emergency is brought under control. As with all crises, we are likely to witness vast changes in the economic, political, social, environmental, and technological landscape which, in turn, will impact infrastructure requirements.

Our industry needs to be ready. Even if the outcomes are not yet known, we need to be aware of the changing circumstances and make sure we’re not late in our response. In the short term, we must prepare to adapt our infrastructure to cater for social distancing requirements, and as we emerge from the crisis, we must anticipate some of the more profound and lasting changes underway.

Given the severity of this crisis, our industry has a duty to ensure infrastructure creates the maximum benefits. To do this, we must be ready for the new normal, adapting our approach to infrastructure accordingly.

When building the case for investment in infrastructure, the potential for economic returns is the most cited rationale – how much growth will be unlocked, how many jobs created. But casting a narrow focus on short-term economic returns may be impeding both the investment and political will necessary to advance projects with larger social benefits.

As an industry, in order to deliver benefits such as wellbeing, emissions reductions and equity we need to find ways to measure and assess them. Communicating those quality-of-life benefits will help rally support in affected communities and give promoters and funders rationale to move ahead. 

Recognition of the importance of social benefits is growing, with governments in New Zealand, Iceland and Scotland 'BBC News: Iceland puts well-being ahead of GDP in budget' tailoring policies towards measures of wellbeing as well as gross domestic product. The UK Government has taken a different legislative approach that takes account of social value in public-funded projects. Commissioning bodies are now typically weighting the delivery of social benefits around 10 percent of their tender evaluation processes.

Economically speaking, we are living in the most prosperous time in history, despite the devastation being inflicted by the coronavirus. Yet there is a perception that our cities and towns are under-prepared to weather the impacts of the myriad of threats now facing us.

The timing of threats such as coronavirus is extremely difficult to anticipate, but the responses can be managed. The costs of inaction are high – from hurricanes to flooding and drought, not to mention the devastating bushfires in Australia and California.

Too often the stumbling block to implementing these strategies is a lack of money. Capital sources exist but securing the funding and financing is essential for success. For resilience strategies to be implemented, we need to look for ways of bridging the funding gap, including innovative financing mechanisms and making the case with the communities who are paying for them.

Often, it’s the poor and vulnerable communities who are most affected. Those lower down the income scale have few options when disaster strikes. Moreover, as urban populations grow, improvements to public services such as transport and housing will be needed to avoid a detrimental impact on daily lives.

When it comes to funding and financing, getting the incentives right is key. In some places, private financing has fallen out of favor. To find a way forward, aligning public and private sector interests is key.

Private finance models are a way for the public sector to access the skills, discipline and expertise of the private sector. Such set-ups have fallen out of favor due to badly-designed projects that failed to serve the interests of all parties – but that doesn’t need to be the case.

Unless we as an industry make the case for private sector financing, much needed infrastructure won’t happen. Winning the argument will depend on two things. Firstly, for private financing to be relevant and have a future, public and private sector interests need to come together. Secondly, the industry needs to make more effort to listen to citizens’ needs and respond to them by delivering real and tangible benefits in response to their concerns.

In this way, we can show that privately financed projects can be both in the public interest and provide value for money.

Moved by climate concerns, the public are applying greater pressure on corporations and governments to reduce carbon emissions. In turn, some of those organizations have set targets.

The Paris Agreement on climate change commits signatories to limiting global warming to 1.5-2°C. To meet this goal, the Intergovernmental Panel on Climate Change (IPCC) estimates that carbon emissions need to be reduced to zero by 2050. A growing list of countries, cities and corporations are signing up to this target, with some bringing it forward to 2030.

At the same time, advances in technology are reducing the price of renewables and increasing energy efficiency. This, in combination with well-informed policies, is making the Paris goals achievable – but more needs to be done. From community energy schemes to reforestation, humankind has the know-how to reduce infrastructure emissions. Exemplary schemes – that if implemented more widely could have a real impact – should be celebrated and shared.

It’s no longer good enough to cite growth and job predictions when it comes to making the case for infrastructure. Climate change and coronavirus have forced a recognition that traditional metrics need to change to capture the true value of a project.

In this section, we take a look at how promoters of the biggest infrastructure projects go about making the case, taking the planned move of Indonesia’s capital city as an example.

The lifecycle of mega-projects – large-scale ventures involving multiple public and private stakeholders, developed over years with a transformational effect on millions of people’s lives – happens over decades and in some instances even centuries. We argue that to be sustainable, such projects must plan and finance for a future they can’t yet imagine ― and which in some cases, they might never even see.

Predicting future requirements is difficult, but encouraging promoters and sponsors to think on these timescales is an even greater challenge. Nonetheless, understanding where a place and its citizens are headed should guide how mega-projects are prioritized.

When it comes to large infrastructure projects, the money and timescales involved makes innovation a risky business. In these industries, even small errors can be hugely costly.

Although there’s a recognition in many sectors that changes are needed, there is also, naturally, a degree of nervousness about moving from a culture that minimizes risk to one which rewards risk-taking.

Moving from idea to innovation depends, in the first instance, on the quality of the idea. But without a supportive environment, many good ideas will fall by the wayside.

At AECOM, we believe in championing our creative thinkers, giving them time and space to test and evolve their ideas. We do this by regularly calling for submissions to our innovation competitions and by encouraging our people to challenge the status quo. This culture has yielded an environmentally friendly method of harvesting harmful algae blooms, a destruction technology for dangerous chemicals, as well as many time and money-saving complexity-reducing construction technologies.