Progressive Building (Feb / Mar 2013) The Road Ahead

01 Mar 2013

Rob Gaimster
Cement & Concrete Association (CCANZ)

Cement & Concrete Association of New Zealand (CCANZ) chief executive, Rob Gaimster, looks at how the decision to seek a Public-Private Partnership (PPP) for Wellington’s Transmission Gully makes the benefits of concrete roads even more compelling.

Transmission Gully will link MacKays Crossing in the north with Linden in the south and is a much anticipated 27-km leg of the 110-km Wellington Northern Corridor Road of National Significance.

The road is being developed as a four-lane expressway from Wellington Airport to Levin to lift economic growth, improve road safety and reduce traffic congestion.

In late November 2012 Cabinet approved New Zealand Transport Agency’s (NZTA) application to pursue a Public-Private Partnership (PPP) for Transmission Gully.

PPP’s have been used in other recent large-scale construction projects like the Wiri Prison and Hobsonville schools.  PPP’s are a long-term contract between the public and private sectors covering the financing, design, building, maintenance and operation of public infrastructure or services.

They are increasingly commonplace in large construction projects overseas and are seen as a way to use private sector innovation and funding sources, as well as increase certainty of delivery by transferring risk to the private sector.

The NZTA predict that a PPP for Transmission Gully will drive greater value for money in dealing with the project’s size and complexity, as well as allowing for construction to begin in 2014, with an anticipated completion date of 2020.

The NZTA also believe it will free up funding for other infrastructure projects in Wellington, as the PPP will debt-fund Transmission Gully to the tune of approximately $1 billion over 5-years.

Since the NZTA announced its intention to proceed with a PPP it has received strong support from the likes of the New Zealand Council for Infrastructure Development and the Road Transport Forum New Zealand, both of which see it as more effective than traditional procurement methods.

Similarly, CCANZ sees the PPP as an opportunity for innovation, and to build a new era of roads made from concrete.

The economic, environmental and safety benefits of concrete roads are well documented.  Concrete’s long-term durability offers significant potential returns on investment. A concrete road’s extended service life, low maintenance, and reduced fuel consumption benefits for motorists are compelling economic factors.

Concrete roads can also be good for the environment. They require minimal maintenance, which in turn reduces congestion and exhaust emissions.  They also enhance the fuel efficiency of heavy vehicles by reducing rolling resistance.

Concrete roads could also slow the process of global warming.  The albedo of concrete - the ratio of the reflected solar energy to the total solar energy received – is high.  This means the light coloured surface of a concrete road translates to greater radiation reflectivity, which can slow the process of global warming.

The light coloured surface of concrete roads can also enhance roadway lighting systems, improving safety for motorists.

Noise factors can also be mitigated. Grind-and-groove surface technology to reduce surface noise from concrete roads is now commonplace in Australia and North America.

While these benefits are generally recognised, New Zealand has been slow to take advantage of them.  NZTA’s high discount rate is a factor in this.  This rate determines the cost and benefits of infrastructure projects over time, and relates to the evaluation period for infrastructure.

Although both have been adjusted recently, from a discount rate of 10% to 8% and an evaluation period of 25 years to 30-years, a lower discount rate and longer evaluation period would most likely favour infrastructure projects that reduce the total cost of maintenance and operation overtime–such as projects with a long service-life achieved through concrete.

It must also be considered that global oil prices are trending upwards, meaning that traditional road technologies are becoming more and more costly to install and maintain.

The NZTA has a good reputation for prudent asset management.  This could be enhanced further with the selection of concrete as the roading material of choice, particularly for high traffic density sections of the Roads of National Significance.

In summary, PPP’s place a greater emphasis on private sector involvement and offer incentives that encourage innovation and long lasting construction techniques.  As such, the economic, safety and environmental benefits offered to Transmission Gully by a concrete road make sense – providing the consortia bidding for the contract with an ideal solution for a smoother road ahead.

Article appeared in Progressive Building magazine (Feb / Mar 2013).