The role of non-built solutions in accelerating decarbonisation

The infrastructure investment boom is resulting in a shortage of skilled labour across the world. In Australia, the shortage of skilled workers is projected to grow and peak this year. New Zealand is reporting construction labour shortages at its highest level with this challenge expected to continue for years to come. Prioritisation has never been more important. At the same time, the legacy of supply constraints is making it difficult for projects to be implemented within budget. According to Infrastructure Australia, in the last 12 months, the cost of construction materials rose by an average 24 percent. The implications are protracted timelines for the delivery of capital projects, cost blow outs and ultimately slower realisation of the benefits of the investments.

As a result, we can expect spending to help alleviate high cost of living pressures and on pre-election commitments such as education facilities, health services and renewable energy infrastructure. The tight labour market, rising costs and other resource constraints make the distribution of spending programs a tough exercise, filled with robust conversations and analyses on needs, rates of returns and costs vs benefits, pre-existing works, and political factors. Ultimately, this means that programs with a heavy reliance on a large skilled workforce and materials, typically capital works, will be impacted.

Constraints will not only impact the sectors that typically form the bulk of government program funding, such as health, education, transport, and crime prevention. They may well result in the decarbonisation agenda being pushed back. Finding the pure physical capacity in Australia and globally to deliver the energy transition on top of increasing need for social infrastructure and resilience projects is a challenge of the times. We don’t have enough skills and resources to deliver the transition everywhere all at once. This will negatively impact 2030 and 2050 net zero targets because decarbonisation “can’t wait”.

A different way of thinking might offer a way forward. A focus of discussion and practice has been ‘built solutions’ to problems. These, however, are the very resource and spending heavy solutions that are impacted by the tight labour market and constraints. Non-built solutions still may require capital investment in adjacent infrastructure, though substantially less than the built solution approach.

Can governments continue or fast track their decarbonisation agenda in spite of the current challenges, while delivering the level of social services and infrastructure expected by the public?

GHD Advisory is seeing positive outcomes when more attention and investment is devoted to non-built solutions that can optimise and manage the capacity of the infrastructure we already have. Non-built solutions are not new and have been adopted in several sectors, these include health, education and transport. For example, telehealth has been rapidly expedited due to the pandemic and favourably impacts travel, congestion, time efficiencies and reduced disease transmission. Similarly to telehealth, the shift to e-learning for classes and lectures during the pandemic experienced varying degrees of success, yet provided notable benefits. These are examples of non-built infrastructure investment using technology to strike a balance between preserving student and educator needs, while lessening impact on the built environment.

Another example is smart metering in energy and water supply. Utilising price signals, like with peak and off-peak public transport ticketing, smart metering enables consumer choice and behaviourial shifts based on time of day to influence usage shift to cheaper periods. The increased data provided by smart metering can also improve decision-making, optimising investment and use.

• The allure of a new asset is hard to resist, yet evolving our thinking to deliver a more sustainable world working with the resources that are available allows us to move forward. Australia and other countries around the world are going to need to make trade-offs, to prioritise what we do now, later and in the future.

• Non-built solutions are one way to approach the challenge. We are also going to need to start considering alternative solutions to deliver the environmental and societal outcomes that citizens demand. This also means increased emphasis on policy solutions, optimisation of existing assets and services (sweat assets) and adaptive investment pathways.

• The tight labour market, rising costs and general resources constraints might result in decarbonisation programs being pushed back. With careful design, non-built or policy options can be implemented to progress the agenda without requiring the significant lead time and investment with built solutions.

• Tools are available to identify and consider these non-built and alternative solutions. It comes down to the way the problems are framed and considered. Investment Logic Mapping is a tried and tested approach fundamental to business case development.

• The earlier in the process the information life cycle management is developed the better as this can highlight the non-build and alternative solutions at a point where stakeholders are not as wedded to the prospect of a new infrastructure asset. Clients coming to the table with problems rather than the idea of a solution are likely to get the best outcome from the process. Involving a wide range of stakeholders can reveal interrelated factors and outcomes that lead to alternative or non-build solutions.
  
  

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