With the private sector still subsisting on scraps and the non-infrastructure public sector just grateful that its provisions weren’t cut any further in the emergency Budget, the infrastructure market represents a veritable feast at the moment. So welcome to the latest in our infrastructure market reports
The market has some chewy bits, admittedly - investment in roads, for example, is expected to fall, as our overview of the sector shows. But take rail. The coalition, believing in the economic benefits of enhancing the transport network, is broadly behind Crossrail and building high-speed links, as well as a generous sprinkling of other big projects that were outlined in the Budget, such as Manchester Metrolink. High-speed looks particularly interesting, despite some issues that need thrashing out, like where the track will go.
There are also some tasty aviation projects in the offing, such as the £1bn revamp of Gatwick by new owner Global Infrastructure Partners, which will go some way towards compensating for the coalition’s swift dismantling of plans for new runways at Gatwick and Heathrow.
Another area that looks like a good bet is energy from waste. As we explore on pages 12-15, EU directives mean these plants must be built, come what may. In fact, the coalition’s eco-friendly bent means the outlook is positive for most types of green infrastructure.
Things get less clear around nuclear power, however. The Liberal Democrat energy secretary Chris Huhne’s lukewarm attitude to new build is not encouraging. Although he obediently reiterates the coalition’s support for nuclear, he denies the lights will go out without it - something most of our industry’s energy experts, as well as EDF’s head of procurement, vehemently disagree with.
Huhne has said that the UK needs a “meaningful carbon price”, which is positive, because all potential low carbon energy producers, including nuclear power developers, must be given the incentive of carbon being made sufficiently expensive to make it worthwhile to avoid using it.
But government intervention in the carbon trading market is needed as a matter of urgency: 15% of our current power stations will be shut down, due to their old age, by 2015, while EDF’s first new nuclear power station will be completed in 2017 at best. Wind farms may take less time to build, but they do not generate power 24/7. The maths is easy to do. This, coupled with the need for more clarity on high-speed rail and how the private sector will get involved - especially if both PFI and the Infrastructure Planning Commission are to be replaced - all point to the need for quick government action to get infrastructure projects on the table.
Roxane McMeeken, assistant editor, Building
One day events in late November in central London, focusing on the new-build opportunities in:
- Renewable energy
- Nuclear energy
- Energy from waste
With the latest regulatory updates, projects in the pipeline, detailed case studies, and invaluable networking opportunities, this will be your door opener to a place in building UK’s future energy infrastructure.
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