Sustainable infrastructure delivery in water

As the water sector pursues sustainability best practice, the shifts will be felt across all related sectors and professions. Nowhere is this clearer than in the infrastructure procurement space, as entire supply chains respond to new pressures. 

The water sector has come a long way in terms of designing sustainable water infrastructure. There is no shortage of the application of cutting-edge technology and circularity principles in addressing water solutions.  

However, there is an embedded maturity when it comes to how sustainable design is considered in the operational side of water businesses. The knock-on impact, from design to operations, is not always as closely aligned as it could be. 

The water sector has come a long way in a very short time, according to Veolia Chief Technical and Innovation Officer Kate Slattery, with sustainability now being considered more holistically across the entire infrastructure delivery process. 

“There is very good intent in terms of how sustainability principles are embedded into design, including specification of energy efficient equipment, use of renewables on site and plans for energy consumption and spend,” she said. 

“In terms of having close input from an operational perspective, and how the day-to-day operation and procedural considerations can feed into the design, historically that has been a bit disconnected. But we’re now beginning to see these considerations embedded up front and it’s introducing some really good learnings that feed into design.” 

According to Rob Evans, Executive General Manager – Infrastructure at John Holland, the procurement process is very generally split into two parts: the first is estimation and the tendering, the second is the physical buying for the project. 

“But before we even get to the first step, we need to understand the key customer drivers for the project,” he said. “What are they expecting us to deliver? How do we deliver it? How does that align with our values as a business and are we comfortable to bid on this project?” 

“Then you go through a process that gives you the best design answer, and what comes out of that is what you need to procure. So procurement is probably the fourth consideration after customer objectives, corporate values and outline design.” 

And so, successfully delivering sustainable water infrastructure, including how it is designed, built, operated and maintained, must now be planned into the project well before procurement begins. 

Defining sustainable infrastructure

Beca Hunter H2O Business Director – Water David Kirby said the first challenge when meeting with a client interested in the construction of sustainable infrastructure is to define what it is they mean by “sustainable”. 

“Some are deeply focused on carbon emissions. But that’s just one area of sustainability, and it’s quite straightforward to put a metric around,” he said. 

However, sustainable development also includes other environmental, social financial and cultural factors.  

“In water, we’ve always looked at calculating the capital cost and the operating cost. We’ve always come up with a total expenditure amount,” Kirby said. 

“But we haven’t quite moved to a total expenditure for sustainability yet, or even for carbon. Balancing a particular type of infrastructure in terms of how much energy it’s going to use, how much carbon it’s going to emit, or how much carbon is embedded requires looking at all the different scopes of emissions and optimising to suit the objectives of the project. And that doesn’t even touch on social solutions.” 

The challenge with sustainable infrastructure, and the procurement that feeds its construction, is how all the benefits of sustainability are covered and calculated in a single project. In other words, how does a project that involves laying a pipe underground create social and environmental benefits? 

“It can become quite challenging to work out how much to spend from a business case perspective, in terms of perhaps putting a cycleway on top of it, or providing an urban orchard alongside it. You can provide some real community and environmental benefit, but how do you build that into the cost of the project? That becomes quite a challenge, to bring in that component,” Kirby said. 

A number of Beca clients have social procurement frameworks. Particularly in the procurement phase, different authorities are asked to pick a number of social procurement areas of focus, such as regionally disadvantaged people. 

Those localised social focus points then drive responses to tenders in terms of including 

in proposals how those disadvantaged groups might benefit during or after the project. 

Supply chain challenges

Skills shortages and supply chain issues have not gone away, Slattery said, and they continue to cause wild cost fluctuations. Even as availability and reliability have begun to return, those fluctuations still occur. 

“Some parts of the supply chain are being impacted by other global economic factors at the moment, separate to what we’ve seen with COVID,” she said. 

“Solar, for example, has its own challenges with respect to procurement of panels, controls and inverter infrastructure. That can dramatically slow down the rollout of renewables on water sites.” 

For this reason, excellent planning that allows for a longer lead time becomes more important in terms of procurement to assist in the achievement of strategic goals and targets such as net zero, Slattery said. 

For example, if the plan is to move exclusively to renewable energy on a site, there is great opportunity in forward planning to take procurement into account as an essential part of a bigger solution. 

“Procurement wise, you’d need to plan for hedging against the risks of price increases. But that’s only a small part of it,” Slattery said. 

“The greater strategic commitment allows you to see the other benefits of having 100% renewable energy across your sites. 

“We know the grid is electrifying at different rates acrossthe country, so we’re basically making a forward investment in renewables that tapers down over time as the grid decarbonises. So, that decarbonisation commitment from a procurement standpoint is pretty advantageous. 

“If we can plan strategically, we see long-term cost benefits in that our investment reduces over time without having to make capital intensive commitments.” 

Sustainable procurement

Evans said the idea of sustainable procurement, particularly around a circular economy, makes certain decisions clearer and easier. Previously, clients would set specific and sometimes challenging targets around employment and upskilling of local people. These days, targets are also being set around scope 1, 2 and 3 emissions. 

“But with our clients pursuing that circular economy rationale, sometimes we don’t need those targets necessarily to draw a broader solution,” Evans said. 

“If we’re going to deliver them a solution that is circular, then we’ve got to do all of that stuff anyway. And actually, it’s a core value of ours – we want to add to the communities we’re working within – so it would naturally be a part of our approach.” 

John Holland National Water Market Manager Shaun Kempton said sustainable delivery of infrastructure is really about good engineering. 

“When we talk about carbon reduction particularly, a good chunk of that is just good engineering practice. It’s about delivering efficient engineered solutions that speak to the objectives of the client,” he said. 

“If you want to simplify it, it comes down to quantities management, to making sure the dirt we’re pushing and the concrete we’re pouring is efficient and optimal for what we need it to do.” 

Good engineering results in the design team looking at more sustainable concrete mixes, diverse renewable energy sources, such as portable or permanent solar farms, and electric vehicles and machinery. 

Some efforts around sustainability have surprisingly positive outcomes. The hydrogen-fuelled generator recently used on a John Holland project in Sydney was mildly challenging, in that the fuel had to be sourced from Port Kembla. 

“It took significant effort and planning, as it was only the first or second of its kind in Australia,” Evans said. 

“But there was great interest, excitement and engagement among the workforce around the fact that we were using it. Everybody was talking about it and wanted to know what’s next.” 

“This investment will pay off for us because so many young people inside and outside of our business were engaged by it and wanted to be involved as a result. It’s a small thing that makes young people want to work with us.” 

Such small but highly visible changes brought about by the sustainable procurement process helps influence who and what is sourced on projects, Kempton said, especially as trends change quickly. 

“The sector has changed quite a lot in the last five years,” he said. “There is a lot more talk about circular economy objectives, about resource recovery and reuse, about feeding power back into the grid and selling by-products as a second-line stream of revenue. 

“Every time we go to the market there is now a multicriteria analysis we use to select a preferred vendor, and a lot of that is driven by sustainable and social considerations. 

“We have changed some of our business practices in a more formal way, and that is good for everybody.” 

This article was originally published in the 2024 edition of Current, the Australian Water Association’s annual magazine.