Taking action

George Nash | 23 Feb 2017 | Comments

I applaud the new administration’s focus on the U.S.’s infrastructure at the federal, state and municipal level as well as the acknowledgment that now is the time for action through investment.

Where we were once world leaders, the lack of investment in maintaining existing infrastructure coupled with modest development (and in some cases underdevelopment) in new and improved infrastructure has hampered our ability to move goods and services and detracted from our overall productivity.

The US interstate highway system is now 60 years old. Our rail system not only needs updating but expansion. Our water infrastructure needs significant refurbishment. And while the incoming administration is pledging to fund programs, we need to find ways to make the money that will be invested go further.

We know from recent studies the current state of U.S. infrastructure, but we also know that states are beginning to take action at their level, as well as the new administration. Now is the time for not just fixing infrastructure but employing technology and latest advances to improve our roadway, rail, and water systems.

New Funding/Financing Landscape

We see significant momentum building. The Fixing America’s Surface Transportation (FAST) Act, which re-authorizes surface transportation programs through Fiscal Year 2020, was a great first step and we expect to see infrastructure spend pick up throughout 2017.

A number of important infrastructure ballot initiatives were passed in the November election, and a number of state governors are taking action to make infrastructure funding a high priority.

A much-needed funding source is non-public investment in infrastructure. We know that there are billions of dollars available for investment if a greater flow of bankable infrastructure projects can be identified and managed.

We must invest in more economic ways to maintain our infrastructure, and we need to investigate alternative funding methods for the projects that do go forward. Making the expenditures more palatable to governments and voters alike will reduce the fear of increased taxes. Public-private partnerships (P3s) are certainly playing a key role in helping to fill the infrastructure funding gap but other investment methods will be needed if investment by pension funds and other institutions is to be accelerated.

Better investment products will help but there are also some fundamental issues in the industry that need to be addressed if infrastructure is to become more attractive to investors. Recent research by McKinsey shows that the infrastructure industry does poorly in completing mega projects on time, on budget, and to specification. According to McKinsey, nearly 98 percent of these projects suffer cost overruns of more than 30 percent. This is a huge risk, and with risk profile being a major consideration for investors, it is an issue that must be addressed.

Using Technology to Improve Infrastructure Challenges   

The advance of new technologies and our better understanding of how they can increase efficiency is helping to minimize some project risks.

For example, virtual reality is giving us the ability to model the real world accurately in many dimensions and then, using real time data from the Internet of Things (IoT), to continuously improve, model change, and predict outcomes using Building Information Modeling (BIM). Existing modeling approaches which take months or years can now happen instantaneously.

Today, more than 99 percent of physical objects remain unconnected…what an opportunity. If we invest in infrastructure that is technology enabled then we can pave the way not only for the future of connected autonomous vehicles, but for a more connected and efficient country. We’re already helping Colorado Department of Transportation in implementing this vision with the RoadX project, as well as other states as they develop solutions around intelligent mobility.

Technology such as drones are now being used in our sector on construction sites and in other areas replacing the need for staff on the ground, reducing health and safety risks and lowering costs. Imagery collected by drones can be automatically processed and fed into BIM, allowing better, more efficient project management.

Controlling and integrating the entire supply chain, using technology and collaboration, from design to construction right through to ongoing facilities management enables asset owners to better manage risk and deliver an infrastructure life cycle approach.

Off-site fabrication and robotics are automating parts of the construction process and will be increasing used in US construction going forward. There is an opportunity here to greatly reduce disruption to cities and their residents and to expedite construction phases, further minimizing risk.

Here at Atkins we believe that the active application of technologies coupled with detailed engineering knowledge can assist in encouraging infrastructure investment and in ultimately bringing our critical infrastructure systems to state-of-the-art condition, which will help industry and the overall economy, improving quality of life for all Americans.