Part 4: Interactions
No part of our society works in isolation - sectors interact and issues spill over from one sector to another. The Programme of Action's fresh "cut" across the issues highlights the importance of certain of these interactions. For example, its focus on sustainable cities recognises the value of looking at issues of energy, transport, design and infrastructure (such as water services) in an integrated "whole systems" manner.
In this section, we identify some key interactions between infrastructure sectors. This is a preliminary and speculative analysis, and does not attempt to detail the policy issues. We focus on what appear to be four important areas of interaction, further investigation of which would involve significant cross-sectoral partnership work and development of mutual understanding. Inevitably, we have to leave unexplored some important interactions such as that between transport modal choice, which is influenced by infrastructure provision, and impacts on energy systems, the environment and land use. A decision to invest in a port, for example, has significant implications for energy and other transport investment and use.
4.1 The Transport-Energy Interface: More Livable Cities
Our cities will always be places in which people and goods must move around efficiently. Nevertheless, at the transport-energy interface, there is a real opportunity to make our urban areas not only more "efficient", but more livable, and to start correcting some of the trends that have caused congestion and health problems for our cities and city residents over the last 50 years.
Access is the key to transport.292 An important part of making cities more sustainable will be paying attention to ways in which access can be enhanced, while at the same time ensuring that the external costs of people and goods moving around are better internalised by those generating the movement. Typically, this will mean that there will be an incentive for less energy to be used293 and for it to be used in a more environmentally and socially friendly manner. Key elements of this will be recognising that:
- The key is to provide access rather than mobility or transport as such
- Urban design and form can make a major contribution to easier access
- More livable urban environments are becoming key points of competition among cities
- People are becoming more conscious of the need for physical activity to protect and enhance their health, and more inclusive social environments within cities294
- Physical activity built into everyday travel can lower energy use and car dependence
- Active travel benefits not only personal health but also increases social interaction and connectedness, strengthening communities and making cities more livable.295
Changes to cities along these lines will take time, not least because adjustments to urban form and people's habits are generally likely to be slow. On the other hand, efforts by some local authorities to create more livable urban environments are already paying dividends, showing that even relatively radical changes are feasible within a generation. The issues are less tractable for larger cities, and key issues will be strategic vision, institutional integration and policy effectiveness across the wider urban system. Central government assistance will also be important to help investigate and overcome barriers in these areas.296
4.2 The Transport-Energy Interface: Transport Energy Consumption
As noted in section 1.3 above, the New Zealand Transport Strategy contains the objective that transport-related energy consumption should be minimised. While this goal is not a prominent part of the Strategy, its significance lies in the fact that energy used in domestic transport is a major and growing portion of consumer energy use (about 42%),297 and 99% is from non-renewable sources (and thus generates carbon emissions when used). Also, EECA's transport programme contains an indicative target of increasing use of renewable transport fuels by 2PJ by 2012 (modest in relation to total transport energy use in 2000 of 188PJ), through work on biofuels and investigating the benefits of a hydrogen and fuel cell pathway.
Economising on the use of fossil transport fuel may generate significant environmental gains, because of the externalities associated with that energy use, although whether reductions would generate economic gains is less clear,298 and there may be some undesirable distributional impacts - such as effects on low-income households and rural vehicle users - which warrant policy consideration.
Why is economising on transport energy use potentially important for infrastructure? The key reason is that a reduction in fossil fuel energy use in the transport sector may be accompanied by a reduction in the need for new roading infrastructure at the margin (or deferral of investments), since higher fossil fuel prices are likely to be associated with a decline in road use, or a growth rate slower than would otherwise be the case.
How this reduction in fuel use would be achieved is beyond the scope of this report, but the New Zealand Transport Strategy has made a commitment to all costs of transport being incorporated into transport decision making, including project evaluation, and being fair and transparent to users. Also, a full analysis awaits the study of transport costs being currently carried out by the Ministry of Transport. Nonetheless, if the full externalities of fossil fuel transport use are internalised in the price of vehicle fuel, demand for fuel is likely to drop even in the face of a relatively low price elasticity of demand. If and when good quality substitutes for fossil fuels can be brought to market at reasonable cost, the price elasticity (extent of substitution) can be increased.
A second implication for infrastructure lies in the likelihood that alternative fuels will require development of an alternative fuels infrastructure. Some of the uncertainties around alternative fuel development were outlined above (section 3.2.3). With General Motors said to be targeting 2010 as the date for starting to sell fuel cell vehicles (although with widespread take-up well beyond that) it is likely that, in time, hydrogen infrastructure investments will be necessary in New Zealand.299
Meanwhile, there are a variety of alternative fuels, including bioethanol (including from whey, and from forestry waste and crops) and biodiesel (from tallow, for example), each requiring different adjustments to transport fuel infrastructure.
One transition path for transport fuel over the next few decades has been suggested in the UK as involving hybrid and more energy-efficient vehicles in the shorter term, especially for fleets and, perhaps 30 years away, hydrogen from renewables for mass vehicle use, with biomass such as woody crops being converted to methanol, ethanol or hydrogen.300 The work by EECA and others on transition paths for New Zealand will be important in clarifying longer-term scenarios, enabling infrastructure implications to be analysed.
4.3 The Water-Energy Interface: Irrigation Systems
In New Zealand more than most countries, electricity generation depends heavily upon freshwater resources. When precipitation is lower than normal in certain key catchments, the country faces the prospect of energy shortages, as was seen as recently as the early winter of 2003. Droughts also increase the demand for irrigation water (and electricity for pumping), and low flows in rivers can put freshwater ecosystems under stress.
All of this points to the fact that peak demands for irrigation, electricity generation and in-stream flows often coincide. The scarce water resource must be efficiently allocated amongst these competing uses to get the best outcome for sustainable development.
Under present institutional arrangements in New Zealand, there is no allocation mechanism that can serve this purpose. Councils can set minimum flow regimes in rivers, taking account of the needs of industry, but normally they have no way to allocate water amongst abstractive uses other than "first-come-first-served". This inefficiency can be overcome if water permits are subsequently transferable with minimal transaction cost, but only two councils have taken this step to date, and on a limited basis.
The result is that irrigators and other water users have little incentive to conserve water, especially when it is most in demand. Indeed, in some areas "use-it-or-lose-it" policies actually encourage wasteful use of water. This often entails additional electricity for pumping when electricity is in highest demand, and it reduces the amount of water available to other users, be they other irrigators, processing plants, hydroelectric generation, or in-stream ecosystems.
Creating markets that put a value on water would turn this situation on its head: water prices would reflect scarcity, so that users would conserve water during droughts, irrigators would use less electricity for pumping, and more water could be available for electricity generation (and possibly for downstream irrigation), all while in-stream values were protected by minimum flow regimes. This is most important where irrigation and electricity generation are competing for the same water resource.
There is another critical linkage between water and energy - the fact that New Zealand has limited freshwater resources available for electricity generation. As more rivers have been dammed or diverted, fewer and fewer have been left in something resembling their natural state. As electricity demand continues to increase, New Zealand cannot just "dam another river", especially as the ecological, recreational and tourism values of remaining rivers are increasingly valued. This makes it all the more important that scarce resources - both water and electricity - are priced properly, so that infrastructure investment is not wasteful, and delivers the best outcomes for sustainable development.
4.4 The Telecommunications-Transport Interface: Gains from ICT?
There has long been speculation about whether ICT development can generate reductions in transport needs. Certainly the telecommunications-transport interface offers potential for gains, but under what conditions? Even though the rate of change in ICT is very rapid, rendering firm projections impossible, some broad if tentative conclusions may assist in assessing transport infrastructure implications.
Resource savings are possible in a number of areas. Road network pricing systems have already been discussed above - ICT is a critical element in such infrastructure. Two other areas of possible saving, teleworking and teleconferencing, are briefly covered here. Other offsetting effects may exist, e.g. potentially ICT may change customer expectations concerning just-in-time delivery, increasing transport energy use. However, such impacts are beyond the scope of this discussion.
Teleworking offers potential gains in terms of pressure on infrastructure (and reduced need for infrastructure investment) if home workers, or workplaces outside city centres, can exploit better ICT connectivity to reduce travel in congested areas or at congested times. One New Zealand pilot study suggests that reductions in peak period car trips of the order of 5% may be achievable, at relatively low cost.301 There could be some increased electricity demand to support greater teleworking, but this is likely to be a minor effect. In respect of transport savings, a lot may depend on how flexible organisations are or become, the expectations of those in the workforce such as knowledge workers, and how their attachment to the workplace evolves. Given the aging pattern noted in section 2.2 above, it is quite possible that a significant segment of the workforce may over the next 10-30 years begin to seek very different and more flexible patterns of work organisation and job location.
Just like the promise of the "paperless office", however, teleworking may not necessarily reduce travel significantly when longer-term and rebound/lifestyle ("general equilibrium") effects are taken into account.302 Ease of connectivity, for example, may mean that teleworkers are linked to a wider web of contacts, and in some cases this may make their travel more diverse and possibly more extensive, especially if international work replaces domestic. Also, a portion of the savings from teleworking may be offset by greater use of couriers to keep workers linked into the production process. A third process is the tendency of people to locate further away from "employment" or client bases, as connectivity improves. When meetings are necessary, trip lengths may then be greater than otherwise.
In short, a variety of effects need to be taken into account, and the outcomes in terms of pressures on transport systems will only emerge over time. It is worth adding that factors unrelated to transport, such as an increase in teleworker productivity and lifestyle, are also important parts of the wider picture.303 At this stage, while ICT facilitation of teleworking appears to offer worthwhile transport system gains, and the potential for avoiding infrastructure investment, the gains may turn out to be smaller than some have hoped.
A survey carried out with British Telecom suggests that teleconferencing may yield some social and environmental benefits. On the social side, it may include reducing the time spent on travel (and reducing associated stress); freeing up more time for both productive work and for domestic life, and providing greater flexibility (e.g. in dealing with unexpected problems such as illness or travel disruption).304 The principal unresolved issue is whether the effect of faster and easier communications mechanisms such as teleconferencing generates business activity which in the longer term offsets shorter term savings.
In both these key domains, the jury is still out, and empirical work on net effects on transport and energy infrastructure is only in its infancy. However, further work is warranted in or near New Zealand's main centres to try to gain a better understanding of the potential of these options for enhancing sustainability, and avoiding unnecessary infrastructure investment.
Back to Top