by Kim Ho, Journalist, Infrastructure magazine
As industry, markets and governments respond to global climate change agreements, how we deliver a more sustainable economy is a necessary and increasing focus of industry, the public and governments. As the Green Building Council of Australia (GBCA) transitions to a new Chief Executive and continues the delivery of its strategic priorities, Infrastructure spoke with GBCA’s Interim CEO, Jonathan Cartledge, about what we can expect on the horizon for sustainable infrastructure.
A pivotal time for the sector
This month, GBCA’s incoming CEO, Davina Rooney, will pick up the reins after 13 years of Romilly Madew’s much-lauded leadership. In the interim, Head of Public Affairs & Membership, Jonathan Cartledge, has stepped into the role as the organisation moves toward finalising a number of major policy works, including the next evolution of its Green Star rating tools.
Ms Madew, Ms Rooney and Mr Cartledge have all described the current period as a pivotal time for the sustainability sector — across business, government and the community. Mr Cartledge said wholesale transformation and change is underway, driven in large part by the Paris Climate Change Agreement in 2015 and the UN Sustainable Development Goals in 2016, which outlined a range of targets and indicators for governments and industry worldwide to deliver a more sustainable future.
“In the years since those initiatives, we have seen Australia responding at national, state and local levels with clear commitments to net zero emissions,” Mr Cartledge said. “Our current national commitment aims to reduce our carbon emissions to 26–28 per cent below 2005 levels by 2030.
“When we look at that commitment in the context of the built environment and infrastructure, where buildings represent nearly a quarter of carbon emissions, it’s clear there’s an opportunity for us to be a big, cost-effective part of the solution. Our advocacy is about getting governments at all levels to realise and seize this opportunity. Industry, generally, is leading decision–makers in this space.”
Mr Cartledge stressed that whilst small wins and recent advances should be celebrated, we should not lose sight of the point of all those commitments; to stop the change that would follow if global warming exceeded one and a half or two degrees Celsius.
A surge in responsible investments
Markets have responded globally to these governmental sustainability commitments, causing a massive shift in the way businesses operate.
“Investors are demanding greater transparency and assessing risks through a sustainability lens for the assets in which they’re investing,” Mr Cartledge said.
“That’s where the Task Force on Climate-Related Financial Disclosures comes in. Established in 2015, it is changing the way businesses report on their sustainability at a global level. We’re seeing a whole new raft of climate-related financial disclosure reporting that is having a huge influence over investment decisions.”
This enormous growth in sustainability-themed investment and climate-related risk assessment over such a short time offers not only a competitive advantage for businesses, but a broader opportunity for them to reshape themselves in the new environment.
Mr Cartledge noted that as measured by the Responsible Investment Association Australasia, socially responsible investments have increased 39 per cent in the last two years in Australia. 2016 saw $622 billion go towards responsible investments and in 2017, it was $866 billion.
“These are massive increases in the investor demand for assets and products that meet sustainability benchmarks, because that’s where the future lies for governments and for business,” he said.
Beyond Green Star: social infrastructure
The GBCA’s purpose is to lead the sustainable transformation of the built environment to support its vision: ‘Healthy, sustainable, and positive places for people’. Its strategic plan responds to that vision across four priorities:
- Reduction in carbon emissions
- Supporting the delivery in the residential sector of better homes in Australia
- Social infrastructure
- Working closely with around 650 members in the delivery of that vision and its value proposition for members
The organisation is currently undergoing a consultation process with industry to consider the evolution of its Green Star rating system. ‘Green Star – Future Focus’ will transition the rating tools to better respond to a lower carbon future. Building on a success that has seen more than 2,250 projects certified since 2003, it aims to promote ambitious action on carbon emissions with a drive towards net zero carbon and carbon positive buildings.
Green Star is just one of many initiatives and priorities underway at the Council.
“I think the GBCA is really strongly associated with our success across the commercial office space, but we’ve actually got huge depth of experience in others sectors too, particularly in social infrastructure,” Mr Cartledge said.
Social infrastructure is an incredibly broad sector, encompassing community-shaping projects in such varied areas as education, healthcare, community and sports facilities, transport oriented urban regeneration and cultural precincts — anywhere that assets have an interface with the community that benefits from their presence.
Scarborough Pool in WA, the Queensland Showgrounds, 22 universities, and a number of private and public schools, healthcare facilities and distribution centres are among the diverse array of GBCA projects that fall under this category.
“Social infrastructure projects can deliver better outcomes for their owners and operators in terms of the efficiency and productivity of the assets, and better outcomes for the community and the people that use them,” Mr Cartledge said.
GBCA’s work in social infrastructure involves collaboration with all levels of government — who are often the lead procurers or investors, and who currently make up ten per cent of the GBCA’s membership.
This support aims to not only deliver the best possible value for investments, but also to embed sustainability and better outcomes in a holistic sense across the business cases, designs, construction and operation of what are, in many cases, public assets.
How infrastructure can implement sustainability
For Mr Cartledge, the key to delivering sustainability in infrastructure is simple; engage with it as early as possible. This means that developers are, during a project’s initial evaluation phase, starting to consider sustainability frameworks and outcomes, and adopting a holistic approach.
This holistic approach involves understanding the implications of sustainable mandates through all stages of the process: evaluating strategic options for the project, building the business case, supporting value for money through the procurement process, undertaking tender evaluations, communicating the benefits, and moving into construction.
Mr Cartledge believes success is achieved by asking the right questions throughout the process to ensure that the best possible outcomes are going to be delivered.
“I think it is about understanding that sustainability is a core part of the whole lifecycle of the infrastructure being considered, and then, as you progress through the project, really understanding the value proposition, and embedding it within the business case.”
The risks of late or inadequate integration
Early engagement and holistic sustainability may be key to ensuring genuine, long-term sustainability outcomes, but it is also the biggest challenge regarding sustainable infrastructure. For example, the specificity of any given project must be taken into account.
“It’s important to understand that the development, design and delivery of infrastructure will differ depending on the project. Different sub-sectors within infrastructure have different requirements and different procurement methodologies. When we look at how we deliver sustainability through a project, we need to account for all of those unique attributes,” Mr Cartledge said.
Moreover, the risks are great. Without proper consideration, a project suffers.
“When these sustainability factors are considered too late in the process, they’re not properly informing the business case, and become vulnerable to being value engineered out later in the process, when project managers need to cut costs. That’s a missed opportunity.”
Mr Cartledge cited Infrastructure NSW and Building Queensland as leading examples of how independent agencies could advise governments on these complex considerations of sustainable infrastructure procurement and delivery.
What’s the cost of sustainability?
Sustainability is all well and good, but project managers have a duty to investors and stakeholders to minimise costs where possible. What will the integration of sustainable design and construction cost them?
“I think there’s a myth in the market that these types of initiatives cost more,” Mr Cartledge said.
“In reality we know, for example, that a Green Star rating can be delivered for around 2.5 per cent of the project cost, even less depending on the project. That’s without taking into account all of the commercial benefits and improved outcomes and efficiencies that come with that investment in the project over its lifecycle.
“So the business case, conceived early enough, will undoubtedly stack up, but we want to engage with it as early as we can to get the best possible value from these investments.”
And with growing international momentum towards sustainability, projects that do not adequately factor in sustainability may lead to greater costs down the road.
“These are assets built for a lifetime, so they need to be responsive, not just to the world that we’re living in today, but to a more uncertain future, perhaps, in terms of carbon transition and climate change,” Mr Cartledge said.
“The Infrastructure Australia audit from 2015 was emphatic about the importance of considering these issues — reducing greenhouse gas emissions, enhancing resilience and the need to transition to a low-carbon economy. So why wouldn’t you?”
The rise of transit-oriented developments
To achieve its vision of transforming the built environment to one which is sustainable, the GBCA’s remit must span beyond buildings. The organisation is already moving into the transport infrastructure space in a number of ways.
First, the GBCA enjoys a collaborative relationship with the Infrastructure Sustainability Council of Australia (ISCA) and its IS Rating tool. When considering where those transport infrastructure projects interface with communities at the station level, or in the urban redevelopment that happens around those stations, the two authorities work closely together.
Mr Cartledge cites Sydney Metro, Melbourne Metro and Victoria’s Level Crossing Removal Project as examples of successful collaborations. “We’ve been really pleased to be rating those station redevelopments through our Green Star tool,” he said.
In April, the GBCA released a new custom tool, Green Star – Railway Stations, in pilot form, which builds on the work it has done on those projects.
Mr Cartledge said this intersects with the council’s work on Green Star – Communities, which involves the conception and delivery of more sustainable ‘master-planned’ communities, because land value is a growing consideration in the creation and expansion of public transport hubs.
“I think what we’re seeing increasingly is a better appreciation of the value of transit-oriented developments,” he said. “A lot of the big station redevelopments need to be realised through a framework of sustainability that delivers best value to the communities in the long term.”
Political momentum: what’s the next frontier?
With climate change one of the major topics of debate in the May federal election, there was a renewed focus on sustainability initiatives in Australia’s political landscape: electric vehicles, renewable energy, emissions reduction and sustainable infrastructure.
Mr Cartledge said the Federal Government can look to emulate, and build upon the success of Australian industry, which leads the world in many of these areas, driving sustainability in property, real estate and infrastructure.
“Over the last eight years, Australia has led global real estate benchmarks of transparency and sustainability internationally,” he said.
Mr Cartledge cited many heartening examples at a state and local level, and across government agencies, where industry is working in partnership with government to deliver sustainability outcomes in Australian projects with great success.
For him, good sustainability governance would be contingent on balance; policy leadership that delivers not only certainty, but also ambition that incentivises rather than inhibits the innovation visible across industry.
“That will deliver better outcomes for all of us on the ground in our communities, now and into the future.”
To have your say on the future of the GBCA’s Green Star rating tools and learn more about the Future Focus project, visit: www.gbca.org.au/futurefocus.