Unlocking value through sustainability
Aurecon's Director Sustainability & Climate Change Liz Root explains how the transition to a sustainable economy can both reduce costs and unlock new value.
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What does it take to decarbonise major infrastructure and deliver long-term value? Aurecon’s Liz Root explains how taking a systems-wide approach to carbon management unlocks lasting benefits.
Liz Root is an award-winning sustainability practitioner, who has developed evidence-based resilience and carbon management frameworks on some of New Zealand’s largest projects, including Auckland City Rail Link, O Mahurangi Penlink, Papakura to Bombay, Drury Rail Stations and Auckland Light Rail. These programmes have adopted the latest research in sustainability from around the world, tailored for the Aotearoa New Zealand context.
In every case, Liz’s collaborative approach is about uplifting the capability of project teams and partners – in turn helping move the sector forward. In this interview, she explains how her latest work takes a more holistic view of carbon, and how investing in sustainability can deliver greater value for money and better long-term outcomes.
It’s pleasing to see sustainability and carbon being incorporated right upfront at the project development phase – including it as part of the decision-making process to assess the viability of projects. We’re being asked to articulate the carbon investment and how that would be paid back, just as you would with cost.
That means we’re looking at carbon in a much more holistic and pragmatic way – how do these projects function as part of a network or city, how do they change behaviour and how do their construction and operation impact on New Zealand’s emissions budget? It’s almost a ‘lifestyle approach’ to carbon.
If you look at a major public transport investment for example, it will change the way people travel, and we can quantify the emissions saved through private vehicle trips avoided. It will also impact land use – unlocking density around the transport corridor, and data globally shows that developing in existing areas (that is brownfield sites) has better carbon outcomes (i.e. generates less emissions) than building in areas that have so far not been developed (greenfield).
We can now really quantify and articulate that benefit, while also considering the impacts of things like projected population growth, and any carbon used in operation. For example, denser housing is likely to have lower operational energy (electricity) use. Of course, reducing congestion and providing more housing are also good economic outcomes so the two really work hand in hand. It's a much more commercial and true representation of carbon investment.
We’re being asked to articulate the carbon investment and how that would be paid back, just as you would with cost.
It helps us make decisions – we can compare a project to the carbon cost of an alternative one or of not investing at all, and we can understand the carbon pay-back, the lifecycle enabled carbon savings. Understanding the long-term carbon outcomes of these projects means we can decide how they fit strategically into New Zealand’s 2050 target and 2030 commitments and work out which projects we want to prioritise.
I can also very well see carbon outcomes starting to have implications for the financing of these mega projects in the international market. Carbon will become part of the assessment for the viability of lending, and certainly the affordability of finance.
Carbon outcomes are likely to have implications for the financing of these mega projects in the international market.
We’re always looking offshore and internationally benchmarking what we’re doing, and our understanding is that this work into carbon pay back is advanced.
Around the world, most companies are measuring and reducing carbon, but looking at what it takes to pay it back and creating more of a system boundary is new.
Unlocking the supply chain will be key. We’re doing well at seizing one-off opportunities to reduce carbon through innovation and value engineering, but when we can develop new products and innovations at scale (and that are repeatable across projects) that’s where we’ll see the real step change.
Taking a sustainability-led approach can unlock tangible commercial and economic outcomes for businesses and communities. Here our experts share how sustainability can unlock greater value.
Aurecon's Director Sustainability & Climate Change Liz Root explains how the transition to a sustainable economy can both reduce costs and unlock new value.
5:19Annie explains how designing more sustainable buildings can deliver benefits through greater resilience, lower operational costs and even attraction of higher rents and capital values for building owners.
Mega projects delivered over long duration are an obvious opportunity. We’ve seen this with City Rail Link. These big projects (especially where there are forward commitments of contracts) give suppliers confidence to invest in innovation and new technologies that can transform how we do things.
But we’re in a challenging spot where we have pipeline uncertainty – so in the absence of these big projects, what will incentivise suppliers to innovate, and over what time scale? What support can we offer them through grants or R+D tax support to invest in that innovation? Will there be a point where their own emissions targets and social licence to operate require them to invest anyway?
The other opportunity is collaboration. We might see purchasing agencies join forces to engage with the supply chain and develop lower-carbon products together – then reaping the benefits through reductions in their Scope 3 emissions.
Achieving emissions reduction targets will require significant and lasting behaviour change from almost everyone. While most people know what they need to do reduce their emissions, for everyone there are barriers that can delay or impede that change.
Major infrastructure investments can remove barriers and act as enablers of change – for example, a major public transport project can remove large numbers of vehicles off the road for the long term by providing a pleasant, attractive and sometimes faster alternative. By unlocking housing development, it can give people more choice in how they live, in turn delivering benefits in operational carbon.
This really speaks to the need for ambitious projects that support communities and businesses to make transformational and lasting behaviour change. When our environment makes lower carbon living effortless, that’s when we’ll see the uplift we need.
Director, Sustainability & Resilience – New Zealand
