The benefits of proactively planning for infrastructure resilience
Australians are getting set for yet another wetter than usual end to the year.
La Niña, which forms part of the El Niño Southern Oscillation (ENSO), was also behind the multiple and compounding flooding events that hit the east coast earlier this year.
The floods impacted regional communities that were already suffering from the compounding effects of a sequence of drought, bushfires and a global pandemic.
In the wake of these disasters, there’s been increasing recognition across Government, research and industry that Australia must change the way it deals with natural disasters by strengthening our overall resilience.
A key aspect of that is realising that our current infrastructure is not up to dealing with floods repeatedly hitting our cities and regions.
Despite greater upfront expense, resilient infrastructure delivers long-term value
CSIRO’s Dr Russ Wise, a Senior Sustainability Economist, leads a team that has been investigating gaps in our approach to infrastructure development.
“Widespread bushfires from just three years ago have highlighted how easy it is for communities to be cut off, and for basic services to fail,” says Dr Wise.
“It’s not just about natural disasters creating short term failures in transportation, energy delivery, and communications networks. Long-term problems in supply chains, food production, and housing shortages still abound,” he said.
“Few would argue that investing in critical infrastructure such as hospitals, roads, bridges, energy, and water is fundamental to creating prosperous and thriving communities and economies.
“Yet, in the rush to deliver infrastructure, it is critical that we consider resilience in our infrastructure choices, design, and business case assessments. (Disaster resilience – CSIRO)
“There is now substantial evidence demonstrating that the benefits of resilient infrastructure – even if more expensive upfront – greatly outweigh the repair and restoration costs of rebuilding.”
Research from the Global Center on Adaptation has shown that resilient infrastructure could deliver up to $12 for every dollar invested. And closer to home, the QRA has demonstrated over the last decade a return (avoided reconstruction cost) of $3 to every $1 invested in resilient infrastructure Queensland Betterment Funds | Queensland Reconstruction Authority (qra.qld.gov.au).
To unlock these benefits, however, we must properly value and account for resilience in our decision making.
Embedding resilience in all projects great and small
Pivotal to this is improving how cost-benefit analysis is applied, not only in multi-billion-dollar investments – but also in the many smaller day-to-day infrastructure decisions about local roads and bridges, power transformers and drainage culverts.
The Cross Dependence Initiative (XDI) has developed a large national database of more than 300,000 public and private sector assets, covering critical infrastructure and urban development, from working with utilities and governments covering 90 per cent of the Australia population.
It’s where the work of Dr Wise and his colleagues Dr Stafford Smith, Dr Brenda Lin, and Dr Tim Capon comes in.
“The XDI’s large sample  of typical public and private asset classes in Australia shows that 80 per cent of the assets (by number) represent less than 15 per cent of total asset value, which means that a lot of smaller assets like culverts and power poles will never individually receive the attention of an expensive appraisal process,” says Honorary Fellow, Dr Mark Stafford Smith.
“Unfortunately, state-of-the-art decision analyses have not always been feasible for smaller infrastructure projects. Projects vary, but face a common challenge of limited funding, time and capabilities. They are also cost-intensive to resource,” he said.
Research Scientist Dr Tim Capon says that even without costly risk analysis, smaller infrastructure projects provide opportunities to invest in resilience if decision-makers take a broader perspective.
“It is more important to think broadly about the importance of infrastructure for the resilience of social, economic and environmental systems, than it is to quantify all risks to individual infrastructure assets,” he said.
Four ways to improve decision-making for resilience
Dr Wise and his colleagues have developed four simple adjustments to the application of cost-benefit analysis for infrastructure decisions. They believe these will greatly improve decision-making at local, state, and federal government levels for future infrastructure resilience (Pragmatic cost–benefit analysis for infrastructure resilience | Nature Climate Change).
These adjustments include:
- Reframe mindsets and cultures to focus on ‘assets in context’, rather than the assets themselves. Frame the decision context to consider the integral role of infrastructure in the social, economic, and environmental systems that influence the resilience of communities and economies.
- Consider a wider range of scenarios when exploring infrastructure options and assessing outcomes to identify those that support good outcomes (i.e., that perform satisfactorily) across the range of plausible futures.
- Account for the benefits and value created by investing in resilience, not just the future costs avoided through risk management. Strengthen the case for resilience investment by paying attention to the contribution of infrastructure to the resilience of the systems it supports; identifying opportunities to create value for a wider set of beneficiaries than just the owners, operators, or investors in the infrastructure; and monetizing some values as potential revenue streams to fund and finance the infrastructure, where appropriate.
- Assess and report on the sensitivity of options and choices to changes in discount rates. Update business case and procurement procedures to include sensitivity analyses. This is important because it adds transparency to infrastructure decisions with long-term consequences, particularly issues such as path dependency, future repair costs, and consequences for future generations.
Investing in resilient infrastructure today
Dr Wise’s team believes these proposed adjustments could have fundamental implications in how we plan and manage infrastructure and critical services under increasing climate and disaster risks. But investing in such a shift could pay dividends to the broader community, especially when disaster strikes.
For starters, broadening the focus from just assets and owners towards place and beneficiaries for example, requires more inclusive engagement of stakeholders. These groups often have competing priorities.
Another implication would be the need to up-skill decision makers in anticipatory assessment methods to ensure infrastructure and services are disaster resilient. There would need to be an investment in enabling these decision makers to factor in uncertainties about the timing, extent, duration, and magnitude of future severe to catastrophic events. Not to mention new governance arrangements to enable coordination and new partnerships beyond jurisdictions. This would ideally bring together governments, business and communities to deliver infrastructure and services that not only create value for stakeholders in place but are resilient to disruption.
Our researchers are already implementing these steps with our partners where stakeholders are involved from the beginning to ensure their perspectives, values and priorities are factored into discussions and solutions.
For example, Dr Wise’s team is currently partnering with local, state and federal governments, NGOs such as climate-KIC, SMEs including Value Advisory Partners and Resident Capital, and community groups in a range of place-based regional scale projects in NSW and SA. These projects are focused on better understanding and collaboratively building the human, institutional, infrastructural and technical capabilities for scaling up innovation and investments in disaster resilient communities, regions and infrastructure.
In parallel, Dr Brenda Lin’s team, in collaboration with Dr Wise’s and others, is developing a Climate Coach process to assist government and private organisations along the path of understanding and implementing climate risk into their operations. This represents the next iteration of the Commonwealth Government Climate Compass climate change risk management process develop by CSIRO. The Climate Coach process aims to work together with organisations to identify and prioritise climate risks and enable adaptation. (https://research.csiro.au/compass/)
To find out more about their work, visit Enabling Resilience Investment (csiro.au)
 CSIRO researchers would like to thank The Cross Dependence Initiative (XDI) who generously provided some statistics from its large national database that is supporting infrastructure resilience.