Newcastle University

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Work Stream Leader: Richard Dawson

Work package 1.1: Interdependencies, risks and opportunities in infrastructure

Lead Investigator: Richard Dawson; Lead Researcher: Chris Bouch

A precursor to quantified analysis is to develop qualitative descriptions of relevant processes and interactions at the local scale (e.g. inter-operation of ICT and transport systems), and how these interact with regional, national or even broader scales (e.g. mediating land use and value, wellbeing, economic development etc.).

This WP will develop a framework for the analysis of infrastructure interdependencies.  The framework will identify and classify key infrastructure agents (e.g. owners, physical assets) as well as alternative modes of interdependency (e.g. market, physical, geographical), the potential nature of these interactions (e.g. risks, opportunities) and the scale of interaction.

The framework will be summarised using as a series of influence diagrams that will be developed through desk studies, a workshop with stakeholders and subsequent targeted interviews.  The validity of the framework will be tested against a series of case studies.  Furthermore, the influence diagrams will also form the basis for identifying risks and potential opportunities associated with the identifyed interactions.

Work Package 1.2: Understanding Infrastructure Futures  

Lead Investigator: Chris Rogers; Lead Researcher: Chris Bouch

Many relevant futures have been mapped out at a national scale (e.g. the Foresight programmes, ITRC) and these have been extended to regional and local scales (e.g. via Urban Futures), whilst Resilient Futures has specifically considered potential changes in infrastructure interdependency.  Liveable Cities is developing an aspirational set of future scenarios for city living and these similarly have implications for infrastructure provision, while FUTURENET has considered the implications of climate change on the various UK transport networks.  Against this background of EPSRC-funded research conducted by the iBUILD team, WP1.2 will extend our work in this area to construct a set of representative ‘Infrastructure Futures Scenarios’. 

Scenarios are useful devices to prompt thinking away from the current paradigms and avoiding the issues of ‘locked in’ behaviours – they enable ‘what if?’ questions to be posed and explored.  By conducting a range of future scenario explorations of living, working and playing in communities, neighbourhoods, cities and their associated hinterlands, the relevance of proposed infrastructure service provisions and business models can be tested.  Moreover, the context of application of any of iBUILD’s findings is crucial to effective delivery, so the testing will necessarily include context-dependent case studies where datasets are available or can be created.

Work package 1.3: Innovation in Infrastructure Delivery Models

Lead Investigator: John Bryson; Lead Researcher: TBC

Over the next 25 years more than $40 trillion will be spent on infrastructure investment across the globe. Most of this will be spent on urban infrastructure development and maintenance. The financial crisis that commenced in 2008 has meant that for today’s governments and city planners, financial sustainability has become as important as environmental sustainability. It has become increasingly clear that governments are no longer able or willing to finance infrastructure investments using current business models. Thus, alternative business models are emerging to close the gap between infrastructure needs and the ability of governments to fund infrastructural developments. Consequently, various financing models are being tested such as infrastructure bonds, guarantees, user-pay approaches and hybrid forms. Different forms of public private partnerships have emerged as one way of shifting costs off the public balance sheet onto private enterprise, but these costs are ultimately met by consumers and these additional costs may impact on the financial sustainability of urban infrastructure. A recent innovation is a concern with asset sustainability and the adoption of a whole-life approach to infrastructure development. This forces government officials to consider not just the design and constructive of new infrastructure, but also maintenance, upgrading and decommissioning costs and this is influencing the valuation of risk and financing models.

This WP will undertake a comprehensive analysis of business models from around the world to identify opportunities to innovate in the design, delivery, ownership and management of infrastructure services as a result of interdependencies. 

Lead Investigator: Andy Pike; Lead Researcher: Peter O'Brien

Infrastructure financing is undergoing a fundamental process of transformation across the globe. It is marked by the increasing influence of private actors and capital in the provision of public goods and services, the increasing power and influence of financial markets, their processes and intermediaries, and the emergence and increasing importance of innovative financing mechanisms that draw upon the latest financial technologies and instruments to channel investment into the regional, local and urban landscape. Together such changes have profound and resonant implications for the regulation and governance of infrastructure financing and provision. In this context, this WP aims to better understand the emerging regulation and governance arrangements for the new business models of infrastructure financing. Several inter-related tasks will be undertaken:

i)      Literature from different secondary sources – academic, grey and policy – will be identified, collated and reviewed. The aim is to review and critically analyse how regulation and governance arrangements are changing at the regional, local and urban scales.  The review will include UK and international experience and examples. The specific focus will be on how new and emergent models of infrastructure financing are being developed, funded and managed within regulatory and governing structures.

ii)    Targeted primary and semi-structured interviews will be undertaken with key actors from the public, private and civic sectors involved in the new and emerging regulation and governance of new infrastructure funding models. This task will include engaging with actors in a range of organisations at different scales, for example the OECD, EU, EIB, World Bank, national, regional and local governments as well as financial institutions and intermediaries.

iii)   Drawing upon the secondary and primary research, analysis will specify the existing and new actors involved in the regulation and governance of infrastructure financing (e.g. local authorities/local enterprise partnerships/devolved administrations, utilities, pension funds, sovereign wealth funds).

iv)  Next the analysis will identify the emergent types of regulation and governance arrangements, drawing upon the review of international experience and cases. A national analysis of the City Deals in England will be undertaken with a focus upon the governance arrangements for their infrastructure financing mechanisms.

v)   Last, the analysis will distill and determine elements of ‘good practice’, policy learning and sustainability in the arrangements for the regulation and governance of financing for infrastructure provision. This task involves drawing upon the secondary and primary sources to identify what works directly to engage stakeholders and practitioners.

Work package 1.5: Coupled Economic, Infrastructure and Land Use Simulation  

Lead Investigator: Richard Dawson; Lead Researcher: Shifeng Wang

The aim of this WP is to develop greater understanding of the relationship between urbanisation, the economy and infrastructure systems.  The output will be a model combining land use and the economy with infrastructure and its interdependencies.  This will provide a platform for testing a wide range of alternative business model strategies, identified in WP 1.3 for delivering infrastructure at the local scale.

Whilst there are many existing models which integrate land use with transportation, a subset of which also capture aspects of the urban economy, other forms of infrastructure are not accounted for when driving models of land use and urban change.  Furthermore, when existing land use models do not specify the infrastructure requirements of the new urban area, or how it would best be integrated with existing networks.  A platform for local scale infrastructure business modelling will require (i) representation of local agency as well as external policy drivers, (ii) a wide range of infrastructure systems and their interdependnecies, (iii) a financial model that captures the ineraction and valuation of infrastructure services by local agents.

The model will be developed as a generic tool, but will be applied first to Newcastle and subsequently the other case study cities to enable a range of alternative business model to be tested.