October 22, 2007

Infrastructure

North American infrastructure deficit rapidly growing

Peter Mitham

correspondent

More than $50 billion is currently required to improve and maintain Canada’s civil infrastructure, a challenge that was the focus of a recent discussion the B.C. District Council of the Urban Land Institute hosted in Vancouver.

Peter Chamley, a chartered civil engineer with the London, England-based firm Arup (whose work includes the iconic Sydney Opera House as well as infrastructure projects including the route for the Channel Tunnel Rail Link), said a combination of forces are conspiring to fuel current demand for infrastructure.

On the one hand, established cities are grappling with aging infrastructure, while younger, faster growing cities have infrastructure that is aging as well as demand for new infrastructure that will help them compete as emerging centres.

In addition, Chamley believes climate change is beginning to add to the burden.

Australia, for example, is building desalination plants in order to address a shortage in water supplies from traditional sources.

“There’s no one thing that’s driving infrastructure investment,” he said.

Similarly, there’s no one solution for addressing growing infrastructure requirements.

This is especially true as public-private partnerships — commonly known as P3s — take project development out of the public realm and into the hands of private companies.

Governments may set the agenda for projects, but this agenda can demand much more of a project than was traditionally expected in order to ensure a measurable public benefit.

A case in point is the Channel Tunnel Rail Link, Chamley said.

The ambitious project is facilitating development in surrounding areas including around the newly refurbished St. Pancras terminus as well as down-at-the-heel communities such as Stratford in East London.

The area around the Stratford station, for example, is being developed as a site for the 2012 Olympic Games.

Stringent demands can also ensure a return on infrastructure projects undertaken as P3s, Chamley added.

A case in point is the United Kingdom’s water system, where regulations setting strict operating standards have spurred new investment and resulted in reduced failures in the water system.

Chamley contended that this has delivered better service at lower rates to users than estimates indicate would have been possible with public management.

He estimates water users are paying rates that are 35 per cent less than if the investments made since 1992 had been undertaken by government, which had struggled to maintain and develop water systems.

While many criticized government for risking the public interest by placing water distribution in the hands of private, for-profit companies, regulations have ensured accountability and even a measure of healthy competition between companies.

The success Chamley describes illustrates the payoff that comes from hard choices.

Chamley’s fellow speaker, former Pittsburgh mayor Tom Murphy who is currently ULI senior research fellow for Urban Development in Washington, DC, said the development and maintenance of infrastructure is going to come at a cost.

The investments required — US$3.5-trillion in the U.S. alone — will require new approaches through regional cooperation and decisive leadership.

It amounts to an epochal change not unlike what happened when extensive highway infrastructure was first required to support the increase in automobile traffic.

“You need to embrace change like you’ve never seen before,” Murphy said.

“It’s about community will.”

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