stimulus smackdown · canadians to learn from—and make deals with—korea. by james sbrolla 34...

$9 00ReThink. ReBuild. ReNew.

renewcanada.net

Why Great Architecture Won’t

Save Your City

Industry Leaders Predict

Investment Trends

Alberta’s Oil Sands: Economic Boom or

Environmental Bust?

November/December 2009

+Emission Impossible: Shifting Focus to Climate Change Adaptation

StimuluS Smackdown

Putting the “Eh?” in “action:” contention over the Stimulus Fund’s Rollout.

http://www.blgcanada.com

Advocacy groups, political parties and municipalities all have their dukes up over the federal government’s unprecedented infrastructure funding.

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Contents

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31

39

INFRAINVESTMENT

8 Trend Watch Which sectors are booming, which are bust and which are about to become very stimulating.

12 Money Talks The continuing debate surrounding the Infrastructure Stimulus Fund’s rollout. By Mira Shenker

ASSET MANAGEMENT

14 New Wave Preparing infrastructure for the extreme weather to come. By Michael Mortimer

16 City-Wide Inventory Using GIS to manage assets: case studies. By Karen Stewart and Ian Woodbury

REGIONAL FOCUS: WESTERN CANADA

25 News from Western Canada Every issue, we focus on a different region within Canada, reporting on various sectors of our industry.

26 Well-Oiled Is carbon capture the only way to keep Alberta’s oil sands pumping? By Diane L.M. Cook

INTERNATIONAL

31 Bought and Seouled Opportunities for Canadians to learn from—and make deals with—Korea. By James Sbrolla

34 Building Towards Recovery Jean Marc Hunt reports from Washington, D.C. on the state of international markets.

35 Power Shift Todd Latham reports on this September’s SymbioCity tour to Sweden.

DEPARTMENTS

4 Editor’s Note Watch out for the brick wall of public opinion. By Mira Shenker

5 Letters A sampling of some of the online feedback we’ve been getting.

6 ReLocate Jobs gained and lost in the industry.

20 ReFinance What life-cycle costing has to do with P3s. By Karl Scharnitzky

23 StormWatch Storm Cunningham cautions cities to focus on the recipe, not the cake.

37 Community Profile Fort McMurray, Alberta. Oil hub plans for the future. By Kerry Freek

38 The LEED List Two new LEED certifications in Canada.

41 ReEvents North American Strategic Infrastructure Leadership Forum, Building a Sustainable Community and more.

42 Closing Shot Five Myths of Infrastructure. By Todd Latham

ABOUT ThE COVER

NOVEMBER/DECEMBER 2009

14

Design: Donna Endacott

November/December 2009 ReNew Canada 3www.renewcanada.net

Editor’s Note

www.renewcanada.net

November/December 2009 Volume 5 Number 6

EDITOR Mira Shenker

PUBLIShER Todd Latham

ADVERTISING Todd [email protected]

Miles Andrew [email protected]

Lee [email protected]

ART DIRECTION& DESIGN Donna Endacott

CIRCULATION Sharlene [email protected] P. 416-444-5842, ext 117

ASSOCIATE EDITOR

Kerry Freek

By Mira Shenker

Of brick walls and non-issues

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Website: renewcanada.net

ADVISORS Jane Addie, James Sbrolla

This year, our annual “money” issue comes at a time when money and infrastructure are the

buzzwords in a potential federal election. Even so, rather than provide a rundown of the latest projects to be funded by our three levels of government, we’ve included a section on asset management.

That’s because, while the mainstream media has linked economic development to infrastructure investment, we know something they don’t: a healthy stock of infrastructure isn’t dependent on upfront investment. The $50 million or so it takes to build a wastewater treatment plant is only five to ten per cent of the total cost of infrastructure (as Guy Félio pointed out in our September/October 2009 issue). Maintenance and renewal of that plant will be the bulk of the cost.

Given that “life-cycle estimation process” makes for a less catchy headline than “shovels in the ground,” it’s no surprise that coverage of these issues has been boiled down to bean counting and announcement watching.

What’s not making the news is that many cities that submitted projects for stimulus funding have an incomplete inventory of infrastructure assets and no effective way of setting investment priorities. Although they have until the end of 2009 to submit their inventories for PSAB 3150 compliance (see page 16), many still don’t have an asset management strategy or the staff to build one.

While many industry insiders know that the more publicized debate (see page 12) surrounding the pace of the Federal Infrastructure Stimulus Fund’s rollout isn’t the real issue—WeirFoulds’ Bradley McLellan, speaking at IPAC’s recent Cities and Public Policy conference, said “I’ll leave that up to the politicians and media”—there is another stakeholder that cares: the public at large.

Like it or not, those working in the industry are politicians themselves—they’re working to please the members of the public, a group that’s growing more vocal all the time. At that same IPAC conference, Canadian Urban Institute’s Glen Murray said, “People expect now to be involved beyond the ballot box. Eighty per cent of cities aren’t built by government; they’re built by public-private partnerships and civil structures.”

Speaking on the same panel as Murray,

City of London’s Grant Hopcroft pointed out that public consultation and education is critical to any new project or development—even with a tight deadline looming. Again, while “shovels in the ground” is the goal most politicians and media are fighting over, professionals working in the trenches like Hopcroft know it’s no use pushing a project forward without taking the necessary steps: develop an asset management framework; consult and educate the public.

Alternatively, cities and developers can face the scenario that Hopcroft described, where the City neglected to consult properly from the start. When they got to a certain point in the project, they hit a “brick wall of public opinion” and had to start over.

At an industry roundtable this October hosted by the Residential and Civil Construction Alliance of Ontario, Ontario’s Energy and Infrastructure Minister George Smitherman seemed to be hyper-aware of the importance of consultation before passing legislation. In response to several questions about new management models and policies, he said before he can make any announcements, they have a consultation process to undertake. “I don’t want to give the impression that we’ve cooked up some model and are going to drop it on people,” said Smitherman.

So, all local officials have to do is develop an asset management plan based on a comprehensive inventory of their cities’ infrastructure, while at the same time consulting and educating the public, and avoiding political quicksand and proverbial brick walls. When you look at it that way, it does seem like a nice public debate about what amounts to a non-issue is much less stressful.

“People expect now

to be involved beyond

the ballot box.”

—Glen Murray

RESEARChER Hilary Vaillancourt

CONTRIBUTORS David Bell, Michael Bernstein, Frank Carnevale, Diane L.M. Cook, Storm Cunningham, Jennifer Davies, Jean Marc Hunt, Shamshad Madhok, Michael Mortimer, James Sbrolla, Karl Scharnitzky, Karen Stewart, Ian Woodbury

4 ReNew Canada November/December 2009 www.renewcanada.net

Diane L.M. CookDiane is a Calgary-based freelance energy writer and editor and children’s picture book author.pg 26

Karl ScharnitzkyKarl is senior director, business strategy and capital planning, with Altus Group.pg 20

IN ThIS ISSUE

FEATURE CONTRIBUTORS

Letters

next issue: January/february

special insert: Top 100 Infrastructure Projects

advertising Deadline: november 20, 2009

call Todd: 416-444-5842, ext. 111

www.renewcanada.net

Michael MortimerMichael is the program manager of built environment standards at the Canadian Standards Association.pg 14

James SbrollaJames Sbrolla is a freelance journalist and partner in a private equity fund.pg 31

2010 RPIC Federal Contaminated Sites National Workshop 41

Aecon 33

Altus Capital Planning 20

Associated Engineering 16

Atlantic Industries Limited 13

Autodesk 43

Borden Ladner Gervais LLP 2

CH2M HILL 9

CPCI 11

Chartis 32

Dancap Productions 24

Enbridge 39

Federation of Canadian Municipalities 36

Ferpal 30

GLOBE 2010 40

Golder Associates 32

Halsall 38

Infrastructure Ontario 17

Maxxam Analytics 18

Minto Furnished Suites 19

MMM Group 19

Morrison Hershfield 25

Municipal DataWorks 34

OSEA, Community Power 2009 22

PCL 31

PricewaterhouseCoopers 27

Quantum-Murray Remediation Services 10

RCCAO 21

Restoration Environmental Contractors 29

Riva Modeling 15

Sanexen 23

Stantec 10

W.P. Osborne 6

WeirFoulds LLP 44

XCG 27

Readers who’ve followed our online news and blog updates

have also chosen to leave their comments there, as

opposed to sending us a traditional letter to the editor.

This issue, we’ve devoted a little space to some of those

comments. Join the conversation at renewcanada.net

Bruce MacKay comments on “not far Enough,”

editor Mira Shenker’s blog about what cities are

doing to become truly sustainable.

Mira Shenker wrote: What’s needed is a radical reimagining of what it means to manage an urban centre—from how it’s powered to how it interacts with the resources surrounding it.

What’s not needed is a bunch of posturing over federally-funded, one-off projects that save on a few greenhouse gas emissions. At this month’s Association of Municipalities of Ontario (AMO) conference in Ottawa, a 2009 AMO Federal Gas Tax Award went to the Town of The Blue Mountains for using solar power to light up town signage in the Town of Thornbury (a change that eliminates 124.8 kilograms of carbon emissions each year and saves the municipality about $1,300 a month in electricity bills).

I’m not suggesting this is a bad project; I’m saying it may not be award-worthy. Can we not go further?

Bruce MacKay wrote: Many of the solar-powered installations I have seen popping up around the country have little to do with directly reducing emissions, establishing sustainability or going green. They are done to save installation and disruption cost associated with tearing up existing infrastructure to power some small power demand. You are also now seeing lots of applications in remote areas to avoid new distribution lines and the associated costs for that. There may be sustainability spinoffs that could be very significant, but they are not the objective. If a battery-powered communications device on a mountaintop can be recharged by a solar panel and a wind generator, several maintenance trips by helicopter and ground may be avoided on an annual basis for the life of the facility.

These little solar units may be much greener than they look.

Graham Zeisner comments on “Is action Enough?,”

a feature from our September/October 2009 issue.

ReNew Canada brought together industry leaders to discuss, among other things, whether the current Federal Stimulus Infrastructure Fund will deliver the intended results.

Graham Zeisner wrote: Thanks for bringing many of the industry leaders, stakeholders, and so on, into this forum. My concern, however, is that although the message is consistent (more money) there seem to be too many proponents in their own individual silos.

The owners and operators of core civil public works infrastructure need long-term, sustainable funding, but they also require long-term focused advocacy.

Thanks to your initiative we are hopefully heading down the right road.


ReLocate

Former Alberta cabinet minister Jim Dinning, retired Nexen president and CEO Charlie Fischer, and former mayor of Red Deer Gail Surkan have joined the executive committee of the board of directors of Canada West Foundation—the think tank that examines economic issues in western Canada.

Joe Berridge, partner at Urban Strategies Inc., has been appointed to the Enabler Panel of the United Kingdom Government’s Commission on Architecture and the Built Environment. Berridge is

the only Canadian appointee to this design advisory panel, which is comprised of architects, engineers, planners, environmental specialists, academics and developers.

Larry T. Koehle, P.Eng., MPA, the director of public works and engineering for the Town of Caledon, Ontario was elected president of the American Public Works Association

Joe Berridge

To be featured in this column, send your news and tips to [email protected]

(APWA) during the recent 2009 APWA International Public Works Congress and Exposition in Columbus, Ohio. Elected by APWA’s 29,000 members, Koehle will lead APWA, which provides professional development and educational services and promotes increased investment in public works infrastructure and systems. Koehle is joined on the board by APWA president George Crombie, MPA, and past-president Noel Thompson.

Vicki Rodgers is the new CEO of Toronto-based developer Urbanspace Property Group.

Sue Cumming, MCIP RPP, is the new president of the Ontario Professional Planners Institute (OPPI). Cumming was first elected to OPPI Council in 2004 and was instrumental in developing the Call to Action

and release of OPPI’s Healthy Communities, Sustainable Communities report. She will serve as president until 2011.

Larry T. Koehle

Sue Cumming

With the opening of their new office in Toronto, Fibrwrap Construction Ltd. has appointed chemical engineer Anis Somani as vice president of sales and marketing for central Canada.

The Vancouver Port Authority has appointed a chief sustainability officer (CSO), following in the footsteps of U.S. companies Dow Chemical and DuPont. Allen Domaas, currently president and chief executive officer of the Fraser Port Authority, will be responsible not only for the port’s environment department, but also for corporate communication and liaising with 16 municipalities that surround the port operations. Although a rarity in Canada now, more CSOs could be on the way as organizations start to integrate corporate social responsibility and sustainability into their overall business strategies.


http://www.wposborne.com/

top100projects.ca

It’s comIng…

January/February 2010

http://top100projects.ca/

what sectors are seeing lagging investment?

Frank Carnevale: In Ontario, the Green Energy Act has created the unintended consequence of holding off real investment and movement in renewable power projects and smart grid projects because the regulations have taken all year to take shape and give a clear financial expectation to investors. Great intentions, bad delivery. Water and wastewater facilities investment has also been really slow.

Michael Bernstein: Water is a particularly big area where more dollars are needed. Some of Canada’s water supply and wastewater infrastructure is more than 100 years old.

David Bell: Canada has a strong need to increase investment in its electricity infrastructure. At a recent meeting of Energy Ministers, a number of barriers were identified to the required increase in electricity infrastructure investment. One of the key barriers cited was the need for improvements to the regulatory review process. In order to address these areas of infrastructure spending deficits, both public and private funding sources will be required to come to the table. While federal stimulus spending appears to be ramping up, clearly the private sector will also have to participate.

which sectors are holding steady?

Shamshad Madhok: There is still a strong pipeline of projects in the healthcare sector which are at different stages of procurement. In addition, other social infrastructure projects, such as schools, courthouses, prisons and government buildings are maintaining private sector interest and reaching financial close. Equity investors have analyzed and accepted the risk profiles on social infrastructure projects, and lenders have demonstrated their willingness to provide financing and accept “take and hold” positions on these deals.

David Bell: CFI will continue to steadily deploy capital and finance mid-market infrastructure projects across Canada, such as run-of-river hydro projects and other areas of power generation, wastewater and biosolids treatment, government-pay long-term care facilities and other areas within infrastructure.

Frank Carnevale: General civil work has held steady across Canada, despite the slow flow of federal stimulus dollars. Whether we had a global recession or not, the public sector has no choice but to reinvest and rebuild our crumbling roads and bridges, as the capital backlog is too great to ignore.

Jennifer Davies: Across Canada, there seems to be fairly steady investment and a pipeline in sectors such as health, transportation/transit and education.

what new opportunities are about to explode onto the market?

Frank Carnevale: Canada is becoming an emerging investment market for power projects and cleantech. Renewable power generation will grow at a rapid pace with the current Feed-in-Tariff (FIT) program in Ontario and renewable requirements from the United States for markets like British Columbia. Smart grid design, build, operate and products opportunities will be unleashed in Ontario and B.C. and the United States. As well, with first PSAB reports around the corner, real water and wastewater projects are also around the corner.

Shamshad Madhok: We continue to see growth in both road and transit projects, and an emerging pipeline of IT infrastructure and renewable and sustainable energy projects.

Michael Bernstein: We’re likely going to see more “green” infrastructure opportunities, from renewable energy projects to the infrastructure needed to enable and facilitate the smart grid.

Industry insiders weigh in on which sectors are booming,

which are busted, and what to expect in the next few years.

TrenDwaTch

InfraInvestment

Not Pictured:Jennifer DaviesPartnerships BC

Frank CarnevaleChairman and CEO, Bridgepoint Group Ltd.

Michael BernsteinPresident, Macquarie Capital Funds Canada Ltd.

David BellManaging director, Corpfinance International Ltd.

Shamshad Madhok Managing Director, PricewaterhouseCoopers LLP (PwC) and leader of PwC’s federal government and Ottawa Infrastructure and Project Finance


David Bell: There is clearly some acceleration in government funding for critical infrastructure (see page 12). It’s debatable whether this funding will “explode” onto the market, but it certainly appears poised to increase. The challenge for government funding may be the lag in time that it takes to both allocate and to fully deploy such funds. Therefore, it will be critical that both public sources and private funding are used. According to the Canadian Council for Public Private Partnerships (CCPPP), the provinces and territories have identified $97 billion of transportation priorities over the next 10 years. Private, institutional money can be invested into various critical areas of infrastructure projects.

which are the assets that will have the most “stimulating” affect on our economy?

Frank Carnevale: Transportation projects (major bridges, bus rapid transit, light-rail transit) will have an immediate impact on the economy in 2010 and 2011, mainly because of their project sizes and numbers over the next few years. Water and wastewater facility rebuilds will be the next tranche of stimulating projects beyond transportation. Renewable power assets and the smart grid components will be a tremendous boost to the economy.

Shamshad Madhok: Transit can play an important role both in stimulating trade and employment, which are key economic drivers. The United States is Canada’s largest trading partner, with over $1-billion worth of goods crossing the border every day. The impact on the economy will not be immediately noticeable from transit projects, as they take some time to procure.

Michael Bernstein: The Toronto Board of Trade estimates that congestion and gridlock in the Toronto region costs our economy

InfraInvestment

The Canadian Council for Public-Private Partnerships reports that the current cost to rehabilitate Canada’s civil infrastructure system at the municipal level is $57 billion.

The Ontario Public School Boards Association estimates that deferred maintenance costs currently sit at about $8 billion, and that it will cost between $30 billion and $40 billion of investment to repair Ontario’s water and wastewater systems.

The Association of Universities and Colleges of Canada reported in early 2009 that their deferred maintenance backlog was $5 billion.

A report by one of Canada’s major banks earlier in 2009 said that the economic impact of infrastructure spending worth one per cent of GDP is more than double the impact of tax cuts. While this statistic was cited in relation to the U.S. market, the same principle applies to the Canadian market.

STaTS


http://www.ch2m.com/canada

more than $6 billion per year. So investing in transportation infrastructure translates into dollars being put immediately to work while offering significant long-term benefits.

David Bell: The major categories appear to be public transit, water and wastewater, roads and bridges, and other municipal building. The energy sector will also be a major recipient of infrastructure investment, as major hydro and nuclear projects move forward. Transportation and health infrastructure will also see an inflow.

where are the strongest opportunities to invest internationally?

Frank Carnevale: Renewable power generation and required transmission lines are definitely near the top of the list from Latin America to Mongola to right here in North America.

Michael Bernstein: The World Bank estimates that global infrastructure needs for transport, energy, water and communications alone up until 2030 equal approximately US$32 trillion. Canada has significant infrastructure needs as well, and it’s actually a great market to be in right now. Canada offers the benefit of a stable financial system and experienced infrastructure specialists.

How will canadian companies get more experience with big projects if they don’t already have the experience to win bids?

Frank Carnevale: The good news is that the state of our infrastructure (arguably worse than the United States) will enable Canadian firms to gain at-home experience, and should enable them to travel abroad with experience. True to form, Canadian firms have been cautious minority partners during the growth of our P3 markets, but could easily provide the experience needed to deliver on U.S. P3 projects expected to grow over the next few years. Our balance sheets don’t necessarily allow us to have the most equity in any project, but certainly our experience allows us to originate and develop deals, going forward.

Jennifer Davies: I would think sub-contracting on major projects would be a good start. For example, there are hundreds of local and smaller companies that have and are working on the large P3 projects across B.C.

Michael Bernstein: Many large global firms have teamed up with Canadian firms, including engineering and construction firms and other service providers, to win big projects. Macquarie has a long history of putting together such consortiums, including in Canada, most recently on the Autoroute 25 project [completed as a P3 in Quebec].

Have you seen any change in investor appetite for infrastructure?

Michael Bernstein: There continues to be strong investor demand for stable and yielding investment opportunities. Infrastructure as a separate asset class is relatively new to Canadian investors, but it can be a great choice to help reduce risk within a portfolio. Infrastructure assets are typically characterized by stable, long-term cash flow, inelastic demand and high barriers to entry, which usually means steady performance throughout the economic cycle.

InfraInvestment


http://murraydemolition.com/

http://www.stantec.com/default.htm

http://www.cpci.ca/

InfraInvestment

Administration of Canada (IPAC) conference in Toronto, WeirFoulds’ Bradley McLellan said, “Years ago there was long-term funding; now there’s different types of funding programs that have brought forth a trilogy of announcements before you actually have your project open.”

Kennedy calls this “announce-a-rama” a smokescreen for the fact that real action is not being taken.

Standing in an undeveloped park in Burlington, Ontario soon after the release of Kennedy’s report, Liberal leader Michael Ignatieff said, “Canadians are not going to be employed by press releases.” He called the empty plot “one example among

At the same time Prime Minister Stephen Harper was delivering an economic update that amounts to

a tentative thumbs up, Liberal infrastructure critic Gerard Kennedy, who participated in ReNew Canada’s industry roundtable last month, was releasing a report that slams Harper’s Economic Action Plan, calling it an “Economic inAction Plan.”

The Liberals report that only 12 per cent of the $4 billion Infrastructure Stimulus Fund (ISF) fund has been spent, resulting in job losses, rather than the gains of between 120,000 and 132,000 projected by the Conservatives.

At this September’s Institute of Public

thousands where they announce something and nothing happens.”

But Grant Hopcroft, director of intergovernmental and community liaison for the City of London, Ontario, said during a session at IPAC, “I don’t think anyone who knows how this program has unfolded should be surprised at how little actual construction has taken place up to this point.”

At that same session, McLellan said, “[Stimulus funding] is not necessarily going to create jobs in the next nine or ten months. When you take on an infrastructure project, you have to do it the right way. You have to consult, procure the right people to get it done, and so on.”

Politicians at every level enter the debate over how and

when the Infrastructure Stimulus fund gets used.MOnEy Talks By Mira Shenker


Hopcroft said things have progressed as quickly as can be expected: “We had a streamlined process after the federal budget announcement in January; we [London] submitted applications as a municipality in Ontario in the late spring; those were turned around in what was, for any government mechanism given the amount of applications they had to deal with, record time; and we had announcements in early June. “

Despite questions about how public servants were able to sift through the thousands of project applications—a recent Public Service Commission of Canada audit of Infrastructure Canada found the department is facing “a significant shortfall of staff," and that some of the existing staff don’t meet “essential qualifications”—Hopcroft said there’s already plenty of work underway that doesn’t involve shovels. While some projects are easy to implement—“you call for an extension on your road paving contract and you can put people to work next week”—others require time for design and public consultation.

“There are a lot of designers at work,” said Hopcroft. “The folks in the consulting community are probably swamped right now with the amount of work they’re doing in terms of finalizing design for roads, community centres and so on.”

Hopcroft said it’s important to make sure municipalities do these projects right, even with a March 2011 deadline looming—a deadline that Kennedy charges will allow the federal government to “claw back” some of the funding announced for municipalities if it’s not used.

At a separate IPAC session, Canadian Urban Institute’s Glen Murray said, “This ‘shovels in the ground’ mentality means most of what’s currently being built will end up costing us more in operations.” Planning properly makes the difference between a liability and an asset. “If you build ugly and brown, it costs you money,” said Murray.

To meet the March 2011 deadline, McLellan said municipalities need to be “nimble.” Coordinating construction work

with payouts from the ISF and Communities Component of the Building Canada Fund (which has a slightly longer shelf life) is the only way to make this opportunity work.

That’s apparently easier said than done: the Globe & Mail recently reported that Huntsville, Ontario Mayor Claude Doughty put thousands of dollars on his personal credit card to order steel in January for the expansion of an $18.5-million community centre.

Edmonton Mayor Stephen Mandel said that while he can’t speak for a smaller municipality like Huntsville, as long as the paperwork is done, they feel okay to start work. “We’re not worried about getting paid—we’re a big city; if it takes some time we can carry that cost.”

The rollout has been slow going, but Mandel says that’s the nature of bureaucratic process. Once a project is approved by a politician, there’s the inevitable announcement and that’s when the “process” starts.

“If politicians could write the cheques, we would,” says Mandel. “That’s not how it works—at any level. “We have a process to go

through at the municipal level, too. It takes a long time to get a development permit even once the project has been approved by Council.”

McLellan said the real issue isn’t how quickly current funding is flowing, rather it’s how to put long-term funding in place. “As we look forward we’re concerned about what’s going to happen next,” he said. “What will help us address [municipalities’] needs on a go-forward basis as we try to restructure our communities that have been hard-hit by the recession, and what is the risk as we know from the mid-90s, when federal and provincial governments go into deficit? What happens to those programs is that they get cut.”

McLellan said, “Boom/bust is sometimes great; it helps us deal with backlogs. But at the same time we need to have sustainable base funding.”

“I don’t think anyone who knows how this

program has unfolded should be surprised

at how little actual construction has taken

place up to this point.” —Grant Hopcroft

Mira Shenker is the editor of this magazine.

InfraInvestment


http://www.ail.ca/EN/

Asset Management

rise, resulting in adaptive responses such as bolstering dykes, or changing zoning and land use to reduce the vulnerability of buildings and other infrastructure assets. A different community in the far north might be more concerned with melting permafrost, recognizing that melted permafrost can lead to foundation failures.

While climate change complicates the life of asset managers, adoption of modern asset management techniques can dramatically improve the success rate in developing effective adaptive responses to climate change. Here’s why: modern asset management facilitates the work of multi-disciplinary teams with multi-department involvement. This typically includes participation and input from planning, engineering, finance, environment, geomatics, as well as trades and operations.

In its April 2009 white paper, An Asset Management Framework for Canada, the National Asset Management Working Group (NAM-WG) laid out the key principles that define modern asset management. In addition to facilitating better asset management, adoption of those principles can make it easier for asset managers to implement adaptive responses to address climate change.

There are existing climate change risk assessment tools, as well as new initiatives

Ask asset managers how they factor climate change into their work and many will respond that they

focus primarily on greenhouse gas (GHG) emissions reduction.

While this is important, it’s not enough. Climate change adaptation planning is also

essential. In an asset management context, adaptation refers to the degree of resilience that infrastructure has to weather trends that could be dramatically different in the future.

Current local atmospheric and climate information based on historical weather data may no longer be a reliable predictor of future local weather trends. Seasonal temperatures, as well as the intensity, frequency and duration of various forms of precipitation and wind, are dramatically changing. This change can have profound implications for infrastructure that is intended to have a useful life of many decades.

Many communities across Canada have already begun to experience the impacts of climate change, from coastal and river flooding to structural failures to more freeze-thaw cycles.

Impacts will vary depending on where a community is situated. That’s why adaptive responses must be local and site-specific. For example, a low-lying coastal community might be primarily concerned with vulnerabilities as a result of sea-level

in progress. For example, the Canadian Standards Association (CSA) is working on a scoping study (to be released this winter) that will explore the best format for climate change risk management solutions. In particular, it will assess the feasibility of integrating climate change adaptation considerations into an organization’s existing management system. The project is known as the Climate Change Adaptation Risk Management Solution (CCRMS).

In the long term, this project could help integrate climate change adaptation considerations into the existing systems of the over 740,000 organizations in 150 countries that have attained ISO 14000 (environmental management) and/or ISO 9000 (quality management) registrations.

One of the earliest climate change vulnerability assessment tools aimed at local governments was developed by a government/industry consortium. It incorporates principles found in CSA’s original risk management standard (CSA Q850). The guide, Adapting to Climate Change: A Risk-based Guide for Ontario Municipalities, (adaptation.nrcan.gc.ca) was introduced to Ontario municipalities in late 2006. Its qualitative, systematic decision-making process can be used to identify, assess and prioritize vulnerabilities within various management systems, disaster response plans and built infrastructure systems. The process

Steeling infrastructure assets for the more extreme weather to come.

new wavE

By Michael Mortimer

Cred

it: NR

Can

The City of Halifax developed a comprehensive climate change adaptation plan following Hurricane Juan in 2003. Pictured is a rail line that was undercut by waves.


Asset Management

Michael Mortimer is the program manager of built environment standards at the Canadian Standards Association.

Source: C

ity of Toronto Environm

ent Office

Climate change mitigation responses must be global, but climate change adaptation responses must be local.

emphasizes continuous communications and good documentation of each important action.

Another recent initiative is aimed at assessing the vulnerability of various types of engineered infrastructure. Operating under the auspices of Engineers Canada, the Public Infrastructure Engineering Vulnerability Committee (pievc.ca) developed a vulnerability

assessment protocol for municipal buildings, water, wastewater and stormwater systems, and transportation infrastructure. The protocol was pilot tested with various categories of infrastructure in different regions. Currently, the Canadian Institute of Planners is working on assessment and training tools aimed at municipal planners

(cip-icu.ca). The Federation of Canadian Municipalities, through its Green Municipal Fund, published the results of a study on the state of municipal climate change adaptation initiatives by local governments across Canada (gmf.fcm.ca).

Products and services developed within CSA’s Municipal Infrastructure Solutions Program (csa.ca/infrastructure) will also facilitate more resilient, adaptable infrastructure. For example, there are two new training modules that address innovative techniques for stormwater system design and management. There is also a guide on infrastructure design in permafrost regions.

The goals and guiding principles of strategic asset management and the need for developing local climate change adaptation responses are fully aligned. Although various assessment tools are expected to rapidly improve over the next few years, don’t wait to start. There are many agencies and resources that you can access now.


http://www.rivaonline.com/

Asset Management

database for asset inventories and software that helps them to forecast and budget for the ongoing maintenance and replacement of their assets.

Building up complete infrastructure layers has taken years of hard work, but the processes for maintaining data quality and integrity in the GIS environment have matured. Several municipalities that recognize their limitations have successfully used these new resources to create asset management plans.

region of Halton, ontarioThe biggest challenge in complying with PSAB 3150 guidelines lies in asset valuation when there’s no history of original acquisition costs. The Region’s GIS had the most complete and accurate representation of their linear asset inventory available. The challenge was to turn this operational

Municipalities across Canada that don’t have a mature database of asset information are

increasingly looking for help to meet the Public Sector Accounting Board’s (PSAB) 3150 guidelines. Municipalities are required to determine and report on the depreciated value of all their tangible capital assets by the end of 2009.

Some municipalities have already invested in Geographic Informational System (GIS) data. Using a GIS-centric approach to asset management has enabled them to leverage those existing investments in GIS data to build tangible capital asset inventories for PSAB compliance. This can support asset accounting as an ongoing program within the municipal environment, not only as a one-time project. Municipalities are also using the information stored in their GIS

inventory into a financial inventory.Working with experts, the Region developed

valuation formulas that could turn the information it already had into an inventory of assets with replacement costs. The initial valuation was performed by engineers using spreadsheets. They then turned to RIVA Modeling to help them turn these one-time spreadsheets into a manageable, ongoing tangible asset valuation process for loading assets into the asset accounting software they acquired from SAP.

The Region worked with RIVA, ESRI Canada, SAP, IDS Scheer and Clockwork to develop an overall solution that integrates the GIS inventory in ESRI with SAP. The result was a system where all future changes to assets and all new assets will flow from the GIS to SAP without manual intervention.

coast-to-coast case studies: communities use GIS to manage assets.

cITy-wIdE invenToryBy Karen Stewart and Ian Woodbury


http://www.ae.ca/

http://www.infrastructureontario.ca/

m a x x a m a n a l y t i c s . c o m

e: [email protected] tf : 800•563•6266

Invest in

quality science and

be confident in

your results.

test. trust. act.™

standard data fields in the City’s GIS, like length, width or diameter, material and year of construction. They tested the formulas against sample data extracted from the GIS and confirmed that the approach would produce acceptable values.

As a part of the plan, each major asset type had an intervention and maintenance strategy defined, as well as rankings of consequence of failure and risk exposure. These strategies were then applied to all asset types, and three, ten and hundred-year plans were developed. Finally, the report was completed showing the effects of budgetary restrictions on the levels of service within the roads department, and an annual annuity for the 100-year planning cycle was determined.

However, there was still a huge challenge. These inventories were continually being updated and new information was constantly inputted. RIVA DS was set up to build the asset records from the GIS data using its synchronization toolset—keeping the financial inventory aligned with the operational inventory. This ensured that any changes in the inventory or attributes in the GIS will automatically flow into the asset management plan.

Once selected as the tool of choice for the entire city, a pilot project was implemented to apply asset management strategies to four business units: roads (extending the work done for the asset management plan), fire, corporate properties, and transit. Each business unit went through a series of asset definition workshops, and their asset inventories were synchronized. Each business unit determined basic strategies for valuation, maintenance and replacement for their major asset groups. These strategies were then applied to each asset hierarchy, and a 30-year plan was developed outlining the best practices for maintenance and replacement of the assets.

Once the individual business unit plans were in place, a combined view of all four

Asset Management

Municipalities that

recognize their limitations

have successfully used

new resources to create

asset management plans.

The workflow is as follows. When, for example, a new pipe is installed, the GIS group inputs it into the database with material, length and diameter and sets the status to “In Service.” That night, the new pipe segment is identified as an addition, calculates out the useful life and replacement value for the pipe and sends it to the asset accounting module. When the asset accountants get the bill from the contractor, the asset is already sitting in their accounting module, ready to have the value of the work settled into it.

calgary, albertaAt the City of Calgary, RIVA Decision Support (DS) was used as the tool to generate the asset management plans for the Roads Department for 2008/2009. Using a GIS-centric approach to data management and working with experts from Prior & Prior Associates and RIVA, the City developed valuation formulas that could take the information available in its GIS and turn it into an inventory of assets with replacement costs. The key attributes identified were


http://maxxam.ca/index.asp

Halifax, nova scotiaThe Halifax Regional Municipality (HRM) has built a strong team to address PSAB 3150 compliance. Choosing to implement EI to leverage the data housed in their GIS and other source systems allowed the Municipality to adopt complex valuation strategies across their asset inventory. EI was then used to create asset pooling and aggregation rules, which in turn generated financially reportable asset inventory data. Finally, the HRM staff used the built-in integration tools in EI to provide a near seamless flow of asset information from their GIS and other systems to their financial asset accounting system.

was created for the City’s infrastructure management department, which provided cost and prioritization information for each of the pilot business units.

abbottsford, british columbia The City of Abbottsford took a long-range view of the PSAB 3150 requirements—instead of focusing on a one-time solution for loading asset values, its team built a business case for a more comprehensive solution. They included RIVA Enterprise Inventory (EI) to pull their inventories from their ESRI GIS and other sources and create valuation for the assets. They used EI to integrate that inventory directly with their financial asset accounting system. They also built in the funding to take that inventory and use it to start building a long-range plan for the work and funding required to maintain those assets properly using DS. One year later, they have all these software components in place, their initial inventories pulled in and valued, and their first asset management plans are being produced from DS.

Asset Management

Karen Stewart is industry manager, public works, with ESRI Canada.

Ian Woodbury is an aerospace engineer and president of Riva Modeling Systems.


http://www.mmm.ca/

http://www.mintofurnishedsuites.com/

ReFinance

I t’s been said before: the key to a successful P3 deal is agreement on the allocation and size of risk between the

public and private partners. P3s take many forms but they all require an understanding of the risks being accepted—the fundamental objective of any P3 model is that risk should only be transferred when a party can better manage it.

Risk isn’t just a factor in the financing and construction phases, but in the long-term, or maintain, phase of a project.

The basis of the long-term risk is largely the depth and accuracy of the life-cycle cost (LCC) model and the data needed to create, populate, and maintain the model. Life-cycle costing models will support long-term maintenance of an asset and form the platform for benchmarking the asset throughout the years.

For successful life-cycle modelling,

it’s important to organize inventory and cost data needed to perform the required analyses. A complete understanding and definition of the maintain cost, though seemingly obvious, can be a source of confusion. Assets change over time and the data must be managed over time to reflect those changes revealing changes in risk. Finally, tools must be available to use the data.

Useful data is organized around its purpose. Too often, the basis for the data is collected in the design-build phase of a project. This data is excellent for determining project cost but isn’t necessarily organized or repurposed to project those costs as future operations, maintenance, and renewal.

To use data properly into the long term, it’s important to structure it around the asset, its components, and the costs associated with those components.

Life-cycle costing of P3 projects.

Number CrunChing

By Karl Scharnitzky

Life CyCLe Costing of p3 projeCts (LCC)

New build AssessInventoryexisting Assest(s)

AssessCurrent

Condition

backlog, FCI

ForecastLCC

KnownInventory

Tactical Planning(1-5 years)

Strategic Planning(5-30 years)

Operation maintenance renewal


http://altusgroup.com/

View this report and more atwww.rccao.com

RCCAO 25 North Rivermede Road, Unit 13Vaughan, Ontario L4K 5V4Andy Manahan, executive directorE [email protected] P 905-760-7777

RCCAO members include: Carpenters’ Union • Greater Toronto Sewer and Watermain Contractors Association • Heavy Construction Association of Toronto

• International Union of Operating Engineers, Local 793 • International Union of Painters and Allied Trades, District Council 46 • Joint Residential Construction Council • LIUNA Local 183

• Residential Carpentry Contractors Association • Toronto and Area Road Builders Association

The Report critiques several Government construction contracting practices in the Greater Toronto-Hamilton Area. It concludes that practices such as unfair allocation of risk, other one-sided contract rights, and non-competitive contract approaches discourage suppliers from bidding for government work. This results in higher prices for the work that is done. The Report notes that recent scandals relating to government procurement at e-Health, the OLG, and others make the subject of government procurement a critical public concern. Even a conservative estimate indicates that Governments could save as much as 3% of their capital cost, by adopting a more competitive approach to procurement, and a further 2% by adopting a more balanced approach to risk allocation. Using only the City of Toronto’s 2009 Capital Budget figures for Public Works and Infrastructure and Public Safety and Emergency Services, such measures would generate savings of $8.7 million.

This RCCAO-commissioned report was released in October 2009

TOWARDS A FAIR AND BALANCED APPROACH

A COMMENTARY ON GOVERNMENT PROCUREMENT OF CONSTRUCTION IN THE GTHA

ReFinance

Asset data architecture carries the tombstone data and must be able to handle a variety of data types, from photos to narratives and houses, as well as links to drawing libraries, web pages, and network locations. Tabular information surrounding the overall asset, such as historical operation and maintenance (O&M) cost tables, is also stored.

Asset value has a variety of aspects: replacement, market, appraised, and insurance. The Facility Condition Index (FCI), so often used as a measure of risk, condition, and/or relative deterioration, can only use one of these aspects as the denominator. Choose the right one (depending on the objective) and the FCI will consistently yield a useful result, impervious to the vagaries of the marketplace, accounting book values, and inconsistent appraisals.

Component data architecture is host to almost all the life-cycle costs—it’s one of the most important elements of the data architecture. Arrange it in a structure that is meaningful to cost planning. Basing component data simply on the construction or Uniformat standards (industry baselines) may be insufficient—building a long-

term capital plan from the maintenance management software (CMMS) will certainly be disastrous. The CMMS won’t have the full inventory because it is only recording preventive maintenance and work orders. How will it account for the existence of those components that never receive maintenance but will require replacement within the life of the contract?

The component data architecture holds many types of data similar to the asset data structure. In particular, condition recording—a key to prioritization—is done at the component level.

Linking systems and sub-systems allows detailed examination of the key elements of cost over time. The design-build phase of the project, for example, typically yields the new construction cost (NCC).

While these costs are different from the replacement cost, they can serve as a useful guideline. The component replacement costs rolled up to the asset level, can stand in for the asset replacement cost. Just ensure that the data represents all the asset’s components. Keep in mind that the NCCs will provide useful information required to establish the initial life-cycle

model. This is the starting point only and the information is refined as the design evolves and is also updated as is required by the Project Agreement over time.

Future risk is all about the cost to do something at a point in time. Let’s call this an event. By using the correct data architecture, event justification, implications of deferral, and priority become obvious.

unless LEEd forces the design to conform to

higher standards and higher specified components,

there’s no impact on life cycle.


http://www.rccao.com/

There are two types of cost to manage: the O&M stream and the capital stream. O&M events come from experience, history and conjecture. There are time-based differences in managing capital events because they march towards us in time. The strategic and tactical approach saves data acquisition costs because less costly methods exist for developing strategic data, whereas in the near-term tactical window architectural, engineering, and cost expertise are required for project execution.

The timing of an LCC capital event hinges on the theoretical life. Applying the right number is difficult. Life is affected by initial quality, installation, use, and can be shortened by poor maintenance (but theoretically never extended by good maintenance, which its original design requires). The theoretical life of the component is the key because that is the time frame used for placing major capital repair and replacement cost events into the future.

Strategies such as Leadership in Energy and Design and green initiatives will have little impact on O&M costs unless significant upfront investment aims directly for energy, maintenance, or availability

gains. The benefits of these strategies sometimes have long-term recoveries because of their high upfront costs, another risk measured and re-measured during contract development. Energy costs typically flow through on P3 projects and may be subject to pain-share/gain-share calculations, a manageable risk to the services provider. So unless LEED forces the design to conform to higher standards and higher specified components, there’s no impact on life cycle.

Actual assets, components and events populate all this data architecture. There are several ways to compile this data, but it’s more cost-effective to use the most advanced technological approach possible. Inventories in large or complex portfolios are seldom correct and up-to-date, while new asset inventories are often structured for construction, as described above.

Initial costing exercises are the practice of defining, in current year dollars, the cost of executing work. These costs are delivered as part of the risk transfer between the project company and the design-build and maintenance teams. Specialists can provide detailed analysis that clearly defines the risk in the cost models. There are many variations on cost such as including or not

including renewal, project management, contingencies, service levels and end-life condition requirements. Each requirement adds a level of complexity, which means additional risk in determination of each factor.

This initial cost model is only one step in the life of the P3. As time passes, O&M and renewal spending will take place. Retaining a record of the expenditures provides a store of historical data from which considerable risk information will be available for the design-build and maintenance parties in the future. The cost data represents an agreement fixed in time based on the predicted life and cost of O&M and renewal over the life of the contract. Over the course of a 30-year contract, variables may change—there’s a high level of uncertainty about the exact event time and end cost, making continual mitigating data analysis over time a must.

Karl Scharnitzky, M.Sc., CD, is senior director, business strategy and capital planning, with Altus Group.

ReFinance


http://www.cpconference.ca/

In the early 1970s, I was a medic on a scuba team in the United States Army’s seventh Special Forces Group.

The seventh SF was, and is, based at Fort Bragg, North Carolina. Our immediate neighbor on the base was the famed 82nd Airborne Division. The 82nd was going through a rough patch at that time. They were known as the “jumping junkies,” a reference to both their method of insertion and their problematic recreational practices.

The Pentagon studied the situation and determined that we were the problem. The 82nd is an elite outfit, but they were next door to the elite outfit. The Pentagon addressed the problem by issuing the 82nd maroon berets. The new hats boosted egos at the 82nd, so the Pentagon showered a rainbow of berets throughout the Army. Not surprisingly, the green ones remained elite, and all others (including maroon) became meaningless.

The Army bought a solution in the form of new hats, rather than establishing an ongoing process for fixing the 82nd’s organization.

And so it is with many cities’ approaches to regeneration. Leaders try to shortcut sound revitalization processes by buying a product that will magically bring the city—or a dead portion of it—back to life. It could be a sports stadium, a convention center, an aquarium, an arts district, or whatever the fad of the moment is. It’s the “consumer approach” to revitalization, often resulting in expensive, embarrassing redevelopment failures.

These cities are often motivated by observing other cities that

how to avoid embarrassing

redevelopment failures.

process OvER PROducT

By Storm Cunningham

Cred

it: Storm

Cunningham

Baltimore’s Inner Harbor and National Aquarium recently won a ULI award for community revitalization.

StormWatch


http://www.sanexen.com/

http://renewcanada.net/

have built such structures and achieved dramatic turnarounds. They ignore the city’s internal process, and focus instead on the external manifestation (product) of the process.

My column in the January/February 2008 issue of ReNew Canada revealed how Chattanooga, Tennessee and Bilbao, Spain pioneered a revolutionary “community technology:” an organizational structure for housing, funding, and perpetuating revitalization efforts. At Resolution Fund, we refer to this model as a “renewal engine” because it manufactures a constant flow of renewal partnerships. Let’s revisit those two cities, and add two more: Baltimore, Maryland and Memphis, Tennessee.

In 1991, Memphis built a sports venue in the form of a huge glass pyramid. Memphis was inspired by Baltimore’s Inner Harbor, with its angular National Aquarium (built in 1981). Chattanooga was also inspired by Baltimore when it opened the world’s largest freshwater aquarium in 1992. Bilbao opened their Frank Gehry-designed Guggenheim Museum in 1997. These four projects have at least three things in common: all were begun in highly-distressed post-industrial economies; all are iconic buildings on waterfront brownfield sites; and all were public-private partnerships.

Those waterfront projects in Baltimore, Chattanooga, and Bilbao are now world-renowned symbols of revitalization success.

Memphis’ pyramid is now a highly visible emblem of revitalization failure.

I was in Baltimore this October attending the ceremony for the Urban Land Institute’s (ULI) Heritage Award. It goes to redevelopment projects that have thrived for at least a generation and, this year, it was presented to the city’s Inner Harbor revitalization project—it’s still picking up steam a quarter century later.

ULI points to three key lessons of the Inner Harbor’s success: activity-based redevelopment, achieving critical mass, and strategic public investment to spur private investment. To those I would add the site itself: a waterfront brownfield. Combining water’s unique ability to attract people with the miracle of bringing dead properties back to life is powerful magic.

Chattanooga and Bilbao both had renewal engines, and Baltimore practiced most of the key functions of a renewal engine. Memphis had no such thing. All they had was a building, not a process.

The Memphis pyramid was a mild success as a sports venue, but it never succeeded at bringing the waterfront back to life. So when the pyramid was mothballed in 2004, it was a white elephant in the middle of a desolate

Storm Cunningham is the author of reWealth! (2008) and The Restoration Economy (2002). he is the founder of Revitalization Institute (Toronto) and CEO of

Resolution Fund, LLC (Washington, D.C.).

wasteland. This made finding a viable new purpose far more difficult than if it were a white elephant in the middle of a vibrant waterfront. Meanwhile, on the other side of Tennessee in Chattanooga, Volkswagen is building a new $1 billion factory on a waterfront brownfield.

Besides not having a renewal engine to drive the waterfront’s—and the city’s—ongoing revitalization, Memphis didn’t even have a shared vision for their waterfront’s future. The city has a lot of company in forgetting that a project implements a plan, a plan implements a strategy, and a strategy implements a vision. Without that shared vision, everything is built on sand. Many communities spend a lot on planning, but nothing on visioning. Asking planners to plan without a vision is planner abuse. It’s not their job to come up with a vision for your future.

Communities are increasingly doing

visioning sessions, but most don’t produce a vision statement that effectively guides future decision-making. They also don’t ensure that future projects effectively reference that vision. Such visioning events can build stakeholder cohesion, but not much else.

Building iconic buildings on waterfront brownfields via public-private partnerships is a powerful, proven approach. To replicate the successes of Baltimore, Chattanooga, and Bilbao, focus on the recipe. To replicate Memphis’ failure, focus on the cake. Process, not product.

Don’t fall for what former Winnipeg mayor Glen Murray refers to as “irritable Bilbao syndrome”—the tendency of cities to believe architects’ propaganda that it’s their buildings that revitalize cities. If you must build something right away, build a renewal engine. Otherwise, you’ll just be trying to boost your spirits by buying a new hat.

StormWatch

asking planners to plan

without a vision is planner

abuse. It’s not their job

to come up with a vision

for your future.


http://www.toxicavengertoronto.com/

wESTERn canada

Each issue, we round up recent news from a different region in Canada and devote even more space to an issue or trend in that region.

Passivhaus Comes to WhistlerThanks to the upcoming Olympics, Whistler, British Columbia, has scored Canada’s first authentic passivhaus (an ultra-low-energy building originating in Germany). ReNew Canada’s editor, Mira Shenker, toured some of these houses in the Netherlands in 2007 and found out first-hand how something as simple as orientation can add up to huge energy savings. The building envelope of the Austria House for the Olympic Winter Games 2010 was prefabricated by Austrian Passive House Group.

Winnipeg’s Infrastructure Gap Climbs to $7.4BIn a release late this summer, Winnipeg Mayor Sam Katz said, “Our public service has confirmed what we’ve always known—that the current level of funding is simply not an option if Winnipeg is expected to make serious strides to long-term sustainability of its existing and new infrastructure priorities.” He was referring to a report assembled by the Secretary of Strategic Infrastructure Renewal sent to the Executive Policy Committee on July 8, 2009 showing it would take $7.4 billion just to bring infrastructure up to an “appropriate level of condition.”

BC Joins the War on Climate ChangeThis September, British Columbia Premier Gordon Campbell signed the 2009 Governors’ Climate Summit Declaration (the 2009 Governors’ Climate Summit was held September 30 to October 2 in Los Angeles) committing the Province to work co-operatively with governments around the world to fight climate change. The declaration commits governors to the pursuit of clean transportation and mobility support for national climate change legislation; acknowledges the increased need for mutual action on adapting to climate change; and supports the recognition of the role of sub-national governments in all aspects of achieving a global climate solution.

Northwest Transmission: For Real This TimeThe federal government is investing $130 million to extend the electrical grid into northwestern British Columbia. In a September announcement, Prime Minister Stephen harper suggested that plans to connect abandoned Bennett, B.C. to Alaska might be revisited. The Northwest Transmission Line was originally meant to complement the Galore Creek mine, but high development costs shut down the project in 2007. Last September the Province invested $10 million in the project, prompting an environmental assessment and renewing interest in the plan.

Wind is in the AirThe Alberta Electric System Operator (AESO) has received regulatory approval for its plan to reinforce electricity transmission throughout southern Alberta to interconnect wind-powered projects. The Alberta Utilities Commission (AUC) agreed that the existing capacity of the transmission system in southern Alberta can’t support the interconnection of additional wind-powered generation. There’s currently about 500 megawatts of installed wind power capacity on the Alberta Interconnected Electric System and the AESO is forecasting an additional 1,200 to 2,700 megawatts of new wind development in the next ten years. The next step is for a transmission facility owner to develop and submit a Facilities Application detailing specific routes. Earlier this year, the AESO assigned AltaLink Management Limited to begin this work.

Announcing ActionPremier Gordon Campbell announced this September that 174 new infrastructure projects (valued at just under $719 million) are being funded through Canada’s Economic Action Plan. “The investments we’ve made since launching the Economic Action Plan have already created an estimated 21,600 jobs. Today’s announcement will create about 4,600 more jobs,” said Campbell.

Regional Focus: Western Canada


http://www.morrisonhershfield.com

Is carbon capture the only way to keep

alberta’s lucrative oil sands in business?

wELL-oileD

By Diane L.M. Cook


Oil Lifecycle GHG Emissions, found that direct GHG emissions from the oil sands are generally about 10 per cent higher than direct emissions from other crudes in the United States. “If cogeneration is taken into consideration, oil sands crudes would be similar to conventional crudes in terms of GHG emissions.”

Hoping to reduce emissions, Canada’s government is investing heavily in carbon capture and storage (CCS). With CCS, carbon dioxide (CO2) is captured at the site of extraction or upgrading, transported via pipeline, and then injected and stored into geological formations or deep saline aquifers that contain water that companies such as Enbridge claim is, “unsuitable for drinking or agriculture.”

How it’s determined that saline water is unsuitable for use is still unclear, and there’s been little testing to find out how sequestration could affect groundwater supplies. Some experts think that the chance

Alberta’s oil sands underlie 140,800 square kilometres of land, an area larger than the state of Florida. The

extraction and upgrading of about 1.1 million barrels a day (in 2006) is simultaneously seen as a boon to the economy and a strain on the environment. While the sector provides billions of dollars in investment opportunities, jobs, and royalties to Alberta and Canada, it’s also a drain on water resources and a major emitter of greenhouse gases (GHGs).

There are currently 91 active oil sands projects—but that number is always increasing, and is expected to continue to increase in the coming years.

Even so, according to the government of Alberta, the oil sands make up only about five per cent of Canada’s overall GHG emissions and less than one-tenth of one per cent of the world’s emissions.

Emissions from extracting and upgrading bitumen have been found to be no higher than producing conventional crudes. Two independent studies prepared for the Alberta Energy Research Institute have found direct emissions from producing, transporting and refining oil sands crude are in the same range as those of the other crudes refined in the United States. Both reports, Life Cycle Assessment Comparison of North American and Imported Crudes, and Comparison of North American and Imported Crude

that a properly engineered CCS project would contaminate groundwater is a long shot. But the American Water Works Association says that large-scale CCS projects could endanger underground sources of drinking water—not just through leaks but through displacement of saline. The pressurized carbon dioxide plume injected over years into a saline aquifer

would force salt water from the aquifer into underground sources of drinking water. In a new study by the Munk Centre at University of Toronto, Graham Thompson calls carbon capture technology an “energy parasite.” He quotes Charlie Bullinger, senior engineer at the Great River power plant near Underwood, North Dakota: “[Carbon capture] costs half as much as the cost of the plant, and physically, you have to double the amount of real estate of the plant to retrofit it on the back of a plant that already exists. At a minimum, you’d have to build 30 per cent more power plants to get back to the base of where you first started.”

On top of those technical complexities, the physical pipeline network that would be required to transport CO2 from all emissions points to the storage locations is extensive—and the infrastructure required for a province-wide CCS system is capital intensive.

While it’s too early for exact cost estimates, the governments of Alberta and Canada have already contributed funding to build the infrastructure for pilot projects.

In July 2008, Alberta announced it will invest $2 billion into CCS under its new Climate Change Strategy, unveiled in January 2008. The province committed to reducing projected emissions by 200 megatons by 2050, 70 per cent of which will be achieved through CCS. (See page 28 for project details.)

Under The Clean Energy Fund, part of Canada’s Economic Action Plan announced in Budget 2009, the federal government will invest $650 million to support large-scale CCS projects in real-world applications. The Canadian and Alberta governments announced this October that they will spend a combined $865 million to help Royal Dutch Shell PLC build commercial-scale CCS at the site of Alberta’s Athabasca Oil Sands Project. Shell's Quest project is aimed at capturing and storing 1 million metric tons of CO2.

As an emerging industry, CCS is expected to create investment opportunities, jobs, and royalties to Alberta and Canada. The Canadian Energy Research Institute (CERI) calculates that over the next 25 years the total economic impact of increasing oil sands capacity at a rate of 100,000 barrels per day would manifest itself in increased investment of $7.8 billion; a combined investment and operations impact that will generate an additional $62 billion in gross domestic product (GDP) and tax revenue (federal, provincial, and municipal) of $11 billion; Alberta collecting an increase of $6.5 billion in royalties; and an incremental increase in GDP of $39.8 billion in the United States.

Some experts think that the chance that a

properly engineered ccS project would

contaminate groundwater is a long shot.



Oil Lifecycle GHG Emissions, found that direct GHG emissions from the oil sands are generally about 10 per cent higher than direct emissions from other crudes in the United States. “If cogeneration is taken into consideration, oil sands crudes would be similar to conventional crudes in terms of GHG emissions.”

Hoping to reduce emissions, Canada’s government is investing heavily in carbon capture and storage (CCS). With CCS, carbon dioxide (CO2) is captured at the site of extraction or upgrading, transported via pipeline, and then injected and stored into geological formations or deep saline aquifers that contain water that companies such as Enbridge claim is, “unsuitable for drinking or agriculture.”

How it’s determined that saline water is unsuitable for use is still unclear, and there’s been little testing to find out how sequestration could affect groundwater supplies. Some experts think that the chance

Alberta’s oil sands underlie 140,800 square kilometres of land, an area larger than the state of Florida. The

extraction and upgrading of about 1.1 million barrels a day (in 2006) is simultaneously seen as a boon to the economy and a strain on the environment. While the sector provides billions of dollars in investment opportunities, jobs, and royalties to Alberta and Canada, it’s also a drain on water resources and a major emitter of greenhouse gases (GHGs).

There are currently 91 active oil sands projects—but that number is always increasing, and is expected to continue to increase in the coming years.

Even so, according to the government of Alberta, the oil sands make up only about five per cent of Canada’s overall GHG emissions and less than one-tenth of one per cent of the world’s emissions.

Emissions from extracting and upgrading bitumen have been found to be no higher than producing conventional crudes. Two independent studies prepared for the Alberta Energy Research Institute have found direct emissions from producing, transporting and refining oil sands crude are in the same range as those of the other crudes refined in the United States. Both reports, Life Cycle Assessment Comparison of North American and Imported Crudes, and Comparison of North American and Imported Crude

that a properly engineered CCS project would contaminate groundwater is a long shot. But the American Water Works Association says that large-scale CCS projects could endanger underground sources of drinking water—not just through leaks but through displacement of saline. The pressurized carbon dioxide plume injected over years into a saline aquifer

would force salt water from the aquifer into underground sources of drinking water. In a new study by the Munk Centre at University of Toronto, Graham Thompson calls carbon capture technology an “energy parasite.” He quotes Charlie Bullinger, senior engineer at the Great River power plant near Underwood, North Dakota: “[Carbon capture] costs half as much as the cost of the plant, and physically, you have to double the amount of real estate of the plant to retrofit it on the back of a plant that already exists. At a minimum, you’d have to build 30 per cent more power plants to get back to the base of where you first started.”

On top of those technical complexities, the physical pipeline network that would be required to transport CO2 from all emissions points to the storage locations is extensive—and the infrastructure required for a province-wide CCS system is capital intensive.

While it’s too early for exact cost estimates, the governments of Alberta and Canada have already contributed funding to build the infrastructure for pilot projects.

In July 2008, Alberta announced it will invest $2 billion into CCS under its new Climate Change Strategy, unveiled in January 2008. The province committed to reducing projected emissions by 200 megatons by 2050, 70 per cent of which will be achieved through CCS. (See page 28 for project details.)

Under The Clean Energy Fund, part of Canada’s Economic Action Plan announced in Budget 2009, the federal government will invest $650 million to support large-scale CCS projects in real-world applications. The Canadian and Alberta governments announced this October that they will spend a combined $865 million to help Royal Dutch Shell PLC build commercial-scale CCS at the site of Alberta’s Athabasca Oil Sands Project. Shell's Quest project is aimed at capturing and storing 1 million metric tons of CO2.

As an emerging industry, CCS is expected to create investment opportunities, jobs, and royalties to Alberta and Canada. The Canadian Energy Research Institute (CERI) calculates that over the next 25 years the total economic impact of increasing oil sands capacity at a rate of 100,000 barrels per day would manifest itself in increased investment of $7.8 billion; a combined investment and operations impact that will generate an additional $62 billion in gross domestic product (GDP) and tax revenue (federal, provincial, and municipal) of $11 billion; Alberta collecting an increase of $6.5 billion in royalties; and an incremental increase in GDP of $39.8 billion in the United States.


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More specifically, CERI’s July 2009 study, Economic Impacts of the Petroleum Industry in Canada, reports that based on a 25-year forecast, oil sands developments in Alberta will inject $1.6 trillion into Alberta’s economy, contributing to a total impact of $1.7 trillion to Canada’s economy. The sector will also generate on average 11,419,000 person years, or, on average, 456,000 jobs—that includes direct employment in the oil sands area and indirect and induced employment in every other Canadian province and territory.

Peter Howard, vice president of research at CERI, says “Alberta’s economy runs on energy. With the province’s conventional oil on the decline and gas developments being curtailed because of low market prices, with its contributions to provincial royalties, taxes, GDP and employment, [the oil sands] is the energy source that will carry the province forward.”

As for the environmental costs of this economic growth, Howard says, “New technology will address GHG emissions and permit oil sands developments to continue to contribute to Alberta’s economy.”

Stephen Kaufman, chairman of the Integrated CO2 Network, which has 18 of Canada’s largest CO2 emitters as members, says the organization has been working with the governments of Alberta and Canada for the past four years on the network design concept for CCS, and to ensure that the pipeline infrastructure is built to the proper specifications.

“We still don’t know how the entire CCS network system will pan out,” says Kaufman. “Some emitters might opt to build their own pipeline from their emissions site to a nearby storage location and some emitters will choose to network with the province’s pipeline system. It depends on where their emission sites are located and the closest storage location.”

“Alberta’s economy runs on energy. With the province’s conventional oil on the decline and gas developments being curtailed because of low market prices, [the oil sands] is the energy source that will carry the province forward.”

—Peter Howard

ccs PROJEcTSOn June 30, 2009, Alberta announced investment in three CCS projects:

• Enhance Energy/Northwest Upgrading’s Alberta Carbon Trunk Link, to incorporate gasification, CO2 capture, transportation, enhanced oil recovery and storage in the Alberta Industrial Heartland and central Alberta. It will capture CO2 from the Agrium fertilizer plant and the Northwest upgrader;

• EPCOR/Enbridge’s integrated gasification combined-cycle carbon capture power generation facility adjacent to EPCOR’s existing Genesee power plant, west of Edmonton; and

• Shell Canada Energy/Chevron Canada Ltd./Marathon Oil Sands LP’s fully integrated carbon capture and storage project at the Scotford Upgrader in the Alberta Industrial Heartland.

The expected result of these projects is five million tonnes in annual reductions by 2015, comparable to taking one million vehicles off the road.

Enhance Energy submitted its application to build Alberta’s first CO2 pipeline distribution system to the Energy Resources Conservation Board on March 23, 2009 with regulatory approval expected in early 2010. Construction of the pipeline could begin as early as 2010 with start-up in 2012.

The total capital cost of the pipeline distribution system is expected to be $300 million—although how the cost will be shared between Alberta and Enhance has yet to be determined. The sixteenth pipeline to be built, it will be 240 kilometres in length and will have an initial throughput of 5,000 tonnes of CO2 per day with a design capacity of 40,000 tonnes per day.

The Alberta Carbon Trunk Line will be capable of gathering CO2 from several sources in Alberta’s Industrial Heartland and transporting the CO2 to existing mature oilfields throughout south-central Alberta. These oilfields will see significant increases in production as CO2 is permanently stored in the reservoir. The capture and permanent storage of CO2 will result in significant reductions in emissions of GHGs in the province. The initial supply of CO2 will come from North West Upgrading Inc. and Agrium Inc.

In the initial phase, the pipeline project will have the same impact as taking 330,000 cars off the road and 2,600,000 cars at full capacity.

(Continued on page 30)


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Climate change policy is also still uncertain, so emitters will likely wait for more details before moving forward with CCS plans. With new talk that Canada and the United States will want to align their climate change regulatory plans, plans for major CCS networks may be on hold.

Kaufman says, “There is still a lot of research to be conducted to compare the cost of CCS with other activities that can reduce emissions such as energy efficiency, renewables, or trading under the proposed cap-and-trade system.”

Nevertheless, he believes CCS is a blossoming industry—its success will depend on how well industry and government plans for open access and storage site proliferation. Kaufman says, “Common-use infrastructure will be key to Alberta’s CCS system. Whatever infrastructure is built, all emitters must be able to use it by paying the appropriate toll. This should be the case if government funds are used to subsidize the pipeline or storage infrastructure. Canada’s Integrated CO2 Network wants the benefit of these public dollars to be as wide as possible.”

The oil sands and pipelines are some of Canada’s biggest—and most environmentally and economically impactful—infrastructure projects. While the world continues to rely on fossil fuels, this infrastructure will remain in place. But new infrastructure will be needed to support it and mitigate its effects. Whether or not a complete CCS network distribution system comes to fruition depends on government policy choices and the economics of CCS and the pipeline infrastructure itself.


Diane L.M. Cook is a Calgary-based freelance energy writer and editor, children’s picture book author, and continues to hone her craft with academic pursuits.

With 80 per cent of Canada’s energy supply coming from fossil fuels, it’s impossible to imagine that Alberta’s oil sands will be abandoned anytime soon.

reTurN ON eNergy

But the black isn’t as gold as it used to be. The energy return on investment (EROI) for Canada’s oil sands are estimated to be somewhere in the range of 3:1 to 4:1. EROI is the ratio of how many units of energy are harvested from an energy resource or supply system (oil, gas, coal, biofuels, wind, solar) to how many energy units are put into the system. Historically, EROI estimates for conventional oil have been somewhere

in the range of 15:1 to 50:1. This ratio for liquid fuels has been dropping as countries moves towards newer sources of conventional oil, as well as off-shore oil, heavy oil, gas to liquids, oil sands, coal liquefaction, biodiesel and ethanol. But many supposed alternatives to conventional fuels may have a low return—for instance, it’s estimated that the EROI of ethanol from corn is at best 1.5:1.

(Continued from page 29)


http://ferpalinfrastructure.com/

Flying into Seoul, one is struck by the modern, almost futuristic airport and its high-quality rail links and highways. Clean, efficient and forward looking, Korea

unfolds itself. From the city streets with six lanes of traffic in either direction to the narrow alleys no wider than an arm’s span lined with stores selling everything from cell phone parts to spicy kimchi.

KOTRa, the Korea Trade-Investment Promotion

agency, recently hosted BuyKorea 2009,

one of the country’s most important conferences.

Bringing together delegates from 70 nations—

including Renew canada’s james sbrolla—

KOTRa’s mandates include smoothing the way for

international companies to do business with Korea.

BOuGhT andseouleD

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brolla

With a population of 10 million, Seoul is one of the world’s largest cities—it ranked ninth on the 2008 Global Cities Index.

International


http://www.pcl.com/

In the south, Busan, the country’s second largest city, has a healthy economy bolstered by its beach resort.

With China’s massive population and Japan’s dominant economy, it is easy to understand how smaller nations with similar capabilities might be overshadowed. But for companies sourcing advanced technology, manufacturing capabilities and comparable logistics, this recent trip overseas proved that South Korea is open for business.

After the Korean War in the 1950s, the newly-established South Korea was left with a shattered infrastructure and a fragile economy. But according to Harry H. Kim, a Korean-Canadian businessman with Wardrop Engineering, a Tetra Tech Company, there are many recently completed, ongoing and upcoming projects putting South Korea on the cutting edge in terms of infrastructure.

“South Korea now has a very advanced and modern infrastructure,” says Kim. “In the past ten years and in the next ten, the South Korean government and the private sector are expected to spend US$300 billion on the construction and operation of airports, roads, railways and water infrastructure. An additional US$60 billion will be spent on more than 100 new power-generation facilities.”

Needless to say, South Korea’s energy, transportation and water sectors are seeing some essential growth in infrastructure as well—and it all translates into significant opportunities for Canadian companies.

In the energy sector, South Korea has announced an investment of US$28.5 billion from now through 2022 to enhance generating capacity. Twelve new nuclear power plants are planned, eight of which are already being built; seven coal-fired plants will be built, along with 11 liquid natural gas-fired plants. Another US$80 billion has been assigned to renewable energy infrastructure.

The recycling industry is also about to see growth. With 75 per cent of the country’s renewable energy coming from waste, Korea already has several years of experience in this field. The country’s first biogas power plant has already been built by Daewoo Engineering, and has been operating since 2008.

By the end of 2010, the first Korean tidal power station in Uldolmok is expected to be operational in the Western Gyeonggi Province, which will generate a capacity of 254,000 kilowatt hours. The tidal plant was completed in May 2009 after four years of construction. By 2013, the plant is expected to have 90,000 kilowatts of capacity, which can then supply electricity to approximately 46,000 homes.

Marine energy is an essential part of national development in South Korea, as 97 per cent of the country’s dependence is on foreign energy. Another tidal power plant is scheduled to be

International


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James Sbrolla is a freelance journalist and partner in a private equity fund. he has developed expertise in sustainable development and clean tech over the last two decades while completing trade missions through over 60 countries.

completed by the end of next year and will help South Korea become one of the most advanced marine countries in the world.

The transportation sector is also expected to see new infrastructure. The government announced US$1.7 billion for the rail sector for 2009 and US$1.2 billion for the road sector for 2014. The express train between Seoul and new towns within the Gyeonggi Province is expected to cut travel time for commuters. This rail link is one of the several projects which aim to improve transportation in this location by 2015.

Even more important is the Gyeongin (Seoul-Inchon) Canal, which began construction this year. The 18-kilometre canal will link the Han River and the Yellow Sea. The canal is expected to be completed by 2011 and will cost US$1.7 billion. It should create 25,000 jobs.

In Q4 of 2009 the government announced a major expansion project for Inchon International, the country’s main airport. The project requires US$3.1 billion and includes a new passenger terminal and an increase in capacity by 41 per cent to 62 million passengers a year. Transport links to the airport will also be updated. Two expressways were completed in July 2009, both funded by the Macquarie Korea Infrastructure Fund. A road which links Dogntan and Yongin is expected to be completed by 2015, and completes a loop of roads surrounding the capital region. There is also a plan for a second Gyeonghu Expressway project, which will link Seoul and Sejong City.

Investment will be expanded in social infrastructure projects as well. This includes the four-river (Han, Nakdong, Geum and Yeongsan) restoration project. This project will require US$12.4 billion in 2010. The goal of the project is to secure sufficient water supplies, upgrade water quality, revive ecosystems, and boost the regional economy. These rivers flow through the country’s major urban, industrial and farming areas and are a part of the Green New Deal. Announced in January 2009, Korea’s Green New Deal involves large development projects. These projects will require around US$39 billion over four years, and aim to create up to one million jobs in that time.

The project will consist of constructing damns and reservoirs to store more fresh water and raise Korea’s water quality by 2012. A total of two dams and eight reservoirs will be built on the Nakdong River, and three will be built on both the Geum and Han Rivers. The Yeongsan River will have two further reservoirs on it. The government hopes for 190,000 new jobs from the river restoration project.

Many of these projects are an important part of The United Nations Economic and Social Commission for Asia and the Pacific’s (UNESCAP) suggested five-track approach

to green growth. While green infrastructure development is a significant part of Korea’s New Green Deal, the project also incorporates significant investment in renewable energy.

With the move towards industrialization, South Korea has seen rapid transformations in its infrastructure. By investing more heavily in infrastructure, the country is boosting its power, as well as its industrial and residential sectors.

Justin Jo, KOTRA’s trade officer with the Korean Consulate in Toronto, sums up the situation well: “Korea is a nation focused on the future. By aggressively pursuing its national vision, it has jumped ahead of countries that

have not had to face similar adversity. KOTRA’s mission is to match companies overseas with opportunities in Korea, because we understand the importance of continuous economic development.”

Korea truly is open for business.

International


http://www.aecon.com/

Overall, presenters said that equity has returned over the last few months and that the future is

brighter than it was six to eight months ago. Despite this bounce back, it is still quite difficult to obtain financing for infrastructure projects.

One bright spot, in terms of support, appears to be mass transit. There has been a surge in government support for these projects in recent months.

Panelists said they expect to see full economic recovery by 2012—much of that growth will be thanks to the energy sectors of

builDing TOwaRdS REcOvERyat cG/La’s north american Strategic Infrastructure Leadership forum this September in

washington, d.c., panelists agreed that investment in infrastructure sectors like energy

and transit are helping lead all three north american markets out of the woods.

International

all three North American countries. Mexico, in particular, will see a historic amount of investment in energy. Mexico’s state-owned electricity commission, CFE, is currently undertaking the ambitious modernization goal of having 25 per cent of its power generated from renewable energy sources. Mexico’s Secretary of Energy predicts the country will need to spend US$51 billion over the next decade to meet the growing demand for electricity.

Fuensanta Diaz, a managing director in WestLB America’s energy and infrastructure team, said Mexico’s economic growth is

expected to outpace that of Canada and the United States beyond 2012 and that, compared to infrastructure development models in Mexico and Canada, the United States is behind.

Still, CFE’s Alberto Ramos said Mexico has a way to go before it can overcome internal economic problems. For one, the country is facing an educational crisis. Ramos says, “Mexico has a lot of human capital, but not a lot of prepared human capital.”

— Jean Marc hunt Export Development Canada


http://www.municipaldataworks.ca

general sales tax on all goods and services, so the effective rate on the average Swede may be over 50 per cent.

Tax revenues are the largest source of income for the local authorities and county councils/regions and constitute approximately two-thirds of their total income. In Sweden, municipalities do not levy property taxes—this responsibility falls to the feds.

Some 60 per cent of municipal revenue comes from personal taxes, 14 per cent from government grants and seven per cent from fees and charges.

Keir Brownstone with GLOBE Inc. was amazed by what’s been accomplished in an economy that has seen the GDP consistently increase and attributes it to “an environment of cooperation at the political level.” Anthony Pereira, president and CEO of altPOWER

Every Canadian municipal official on this September’s SymbioCity tour of Sweden was jealous of the degree

of autonomy and independent powers of taxation Swedish municipal officials enjoy. The 290 local authorities (municipalities) in this Scandinavian country of nine million people (GDP of $524 billion) hold the balance of power and are responsible for matters relating to their inhabitants and the immediate environment. This level of government is responsible for primary and secondary education, childcare, eldercare and the care of the disabled, as well as water, sewerage and streets.

To finance these activities, a local authority can levy taxes as a percentage of its residents’ incomes. The average, overall local tax rate is 30 per cent. There’s also a 25 per cent

Inc. said the Swedes have shown “the kind of aggressive leadership the world is looking for.”

For more information on Swedish governance, environmental initiatives and infrastructure projects, look for extended coverage of the September SymbioCity tour in our January/February 2010 issue.

This September, Todd latham joined a group of architects, developers, engineers and municipal

officials on a tour of Sweden and learned what a local authority can do if given actual authority.

power ShIfT

Todd is the publisher of this magazine and would like to thank the Canadian Urban Institute, Swedish Trade Council and Embassy of Sweden for working with ReNew Canada on the SymbioCity Tour. In particular, we thank Lars henriksson, Christina Keighren and Magnus Andersson who were excellent leaders and hosts for all the tour participants.

International

“Stockholm Royal Seaport [pictured here] has set an ambitious target of reducing carbon emissions. We have a strong focus on mobility management; promoting biking, public transport buses run on renewable fuels, and the use of plug-in hybrid cars.”—Ulla hamilton, vice mayor of Stockholm, who joined us for the delegate reception at the Canadian Ambassador’s residence.

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Latham

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mb

rosioThe SymbioCity tour group gathered at the Stockholm residence of the Ambassador of Canada to Sweden. From left to right:Philip Jeung, Toronto Community Housing CorporationTrish Panz, councillor, District of West VancouverFernand Martin, City of QuebecVanessa Farquharson, National PostRaymond Fung, District of West VancouverFranc D'Ambrosio, D'Ambrosio Architecture + UrbanismMichael harding, SHSC, mayor of WoodstockRick Goldring, councillor, City of BurlingtonAlexandra Volkoff, Canadian Ambassador to SwedenMarcel Roy, City of QuebecMargaret Zeidler, Urbanspace Property GroupDaniel Lessard, City of QuebecPeter Busby, Busby Perkins + WillLars henriksson, Embassy of SwedenMagnus Andersson, Swedish Trade CouncilLisa Coltart, BC HydroChristina Keighren, Swedish Trade Council CanadaAnthony Pereira, altPOWER Inc.Keir Brownstone, GLOBE Inc.Todd Latham, ReNew Canada Magazine


http://www.fcm.ca/

fORT McMuRRay, aLBERTaSuggest your community and we may profile it. Email [email protected].

Community Profile

By Kerry Freek

Bucket-wheel and dragline excavators used for surface mining are a common

site in this northern town.

Cred

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urray Tourism

infrastats

“Fort McMurray is the engine that drives much of Alberta's and Canada's economies,” said

Premier Ed Stelmach in a January 2007 speech, noting the over $100-billion worth of projects either approved or planned in the region.

Even in today’s economy that comment still applies. Nestled in the boreal forest at the confluence of the Athabasca River and the Clearwater River, Fort McMurray and its surrounding area is the major hub of Canada’s oil industry, containing about 80 per cent of the world’s total reserves of natural bitumen. The world is spending and making money here, but how has the community (only a city briefly, from 1980 to 1995) invested in its people, and accommodated its growing population of workers and their families?

“There’s a whole lot of work going on,” says Wayne MacIntosh, a manager in Fort McMurray’s engineering department. This past July, Fort Mac was approved for a $6.5-million investment through the Federal Infrastructure Stimulus Fund, which will be directed at the 2010 Sanitary Sewer Main Replacement Project. This initiative will see the replacement and rehabilitation of two trunk sewers in on Signal Road and MacDonald Crescent.

“We’ve exceeded our current capacity,” says MacIntosh, speaking of Fort Mac’s sewers. “We need to debottleneck the existing system.” The sewer section of the new Urban Service Area Wastewater Master Plan, he says, accounts for growth of up to 250,000 people. The entire system’s trunk upgrades will cost approximately $25 million.

In addition to the sewer upgrades, Fort Mac completed construction on a new wastewater treatment plant in November 2008, and is currently working on water treatment plants. Both projects will accommodate 133,000 people, and the Master Plan details expansions for when the population grows again.

Another major investment is Fort McMurray’s Lower Townsite Area

Redevelopment Plan (LTS-ARP). Approved by Council in May 2009, the plan was developed with the help of considerable community input through public meetings, open houses, resident working groups, stakeholder group consultations, advisory committee meetings, and inputs and comments from regional staff. Dennis Peck, general manager of planning and development for the RMWB, says the extensive public consultation process is one of the most innovative and important aspects of the ARP. “We’ll use the process as the benchmark for future planning,” he says. “It’s the right thing to do.”

The ARP’s goal is to provide a comprehensive land use and development strategy to guide future redevelopment in the area until 2030. It addresses issues such as sustainability, intensification, land use integration and compatibility, transportation and connectivity, infrastructure and servicing, flood abatement, as well as the form, function and aesthetics of the area. As well, a Central Business District would be created to accommodate 8,000 to 10,000 jobs in the Lower Townsite. The plan also clarifies land use in the downtown core, protects some existing neighbourhoods, and identifies the change that will affect other areas.

“I believe this is a document that will change the way everyone sees Fort McMurray’s downtown core, and those changes will be for the better,” says Peck.

The 20-year plan proposes to increase the density in the downtown core to improve and create more residential and commercial opportunities. The document proposes a population of approximately 24,000 people in the Lower Townsite, which is double the existing population. How did planners arrive at that projection, especially in the current economic times? “We think it’s a reasonable target,” says Peck. “The current projection is that [the oil sands] are a 400-year exercise. How many communities can say they’ve got such a solid industry?”

• In 2006, Fort McMurray had the highest housing and rent prices in Alberta. The average single-family home sells for $633,686 (August 2009).

• At 35 square-kilometres, it’s the largest community in the Regional Municipality of Wood Buffalo (RMWB).

• Contains about 80 per cent of the world’s total reserves of natural bitumen.

• Fort McMurray accounted for 92 per cent of population growth in the RMWB from 2002 to 2005.

• Residential and commercial construction has recently slowed down in Fort McMurray and in the RMWB.

• A former fur-trading post, Fort McMurray was rebuilt in 1870. It functioned mainly as a transportation centre connecting Edmonton to the Athabasca country.

• Modern Fort McMurray was born in 1964 when Great Canadian Oil Sands (now Suncor Energy Inc) was given permission to start construction.

Location: Northeast of Edmonton, about 60 kilometres west of the Saskatchewan border.

Established: 1870

Population: 79,810 (2008)

Major Industries: Natural gas, oil pipelines, forestry, tourism.

Capital Budget: $486 million (2009)

Funding: In July 2009, Fort McMurray was approved for $6.5 million for its sanitary sewer main replacement project under the Federal Infrastructure Stimulus Fund. In April 2008, the RMWB received $44,078 from FCM’s Green Municipal Fund to help determine the most viable landfill gas recovery technologies for minimizing greenhouse gas (GHG) emissions at both existing and future landfill facilities.


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ngineering

THe leeD® lisT SPOnSOREd By

2 new leeD® cerTificaTions in canaDa Total LEEd® Projects: 168 10 Platinum, 63 Gold, 59 Silver, 36 certified

This column reports on new LEEd®-certified projects in canada using information from the caGBc. LEEd® is administered by the canada Green Building council. cagbc.ca.

This column sponsored by halsall. halsall’s purpose-driven approach to sustainability consulting focuses on connecting each client’s success factors to practical solutions. with our solid technical foundation, we provide green advice for forward-thinking building, community and policy development. halsall.com

Cred

its:Canad

ian Tire

waterloo regional police service investigative services building (wrps isb)certified: august 19, 2009 LEEd® canada- nc Gold

architect: Rebanks Pepper Littlewood architects

leeD® project Manager: Enermodal Engineering Ltd.

structural engineer, building Health science Technician: MTE consutants Inc.

civil engineer: Oden detech Group

commissioning agent: Mcw consultants Ltd.

contractor: Melloul-Blamey construction Inc.

Cambridge, ON: This two-storey office and lab was designed and built to meet green building objectives including minimizing the building’s ecological footprint; conserving energy, water, and material resources; and providing a healthy place to work.

During construction, several measures prevented contaminants from entering the indoor air stream, including sealing

ductwork, regular site cleaning using sweeping compounds, and the segregation of construction areas by dust curtains. Non-polluting finishes and furnishings were chosen to protect air quality and carbon dioxide sensors are mounted in the return air plenum and meeting rooms. The building’s low velocity displacement ventilation system is another design measure that affords high ventilation effectiveness year-round.

The building is designed to achieve a 60 per cent reduction in annual energy costs through heat recovery ventilators that pre-heat ventilation air using heat recovered from exhaust air; high efficiency condensing boiler and domestic hot water heaters; high performance windows; energy-efficient lighting design; occupancy sensors that turn off lights when a space is unoccupied; and a long-term building performance monitoring program.

A 65 per cent reduction in indoor water use and a 68 per cent reduction in the water used for sewage conveyance is achieved through rainwater harvesting and water-conserving indoor plumbing fixtures. The cistern and water fixtures are estimated to

save about 840,000 litres of potable water each year.

About 84 per cent of construction waste was diverted from landfill, while 30 per cent of the materials used in this building (including concrete, rebar, steel, insulation, gypsum, tile, carpet and asphalt) have high recycled content. About 34 per cent of the construction materials used are from local sources.

canadian Tirecertified: July 30, 2009 LEEd® canada- nc Silver

architect: RaI architect Inc.

leeD® consultant: Enermodal Engineering Ltd.

structural engineer: y&v Engineering Ltd.

Mechanical engineer, commissioning agent: Inviro Engineered Systems Ltd.

electrical engineer: hammerschlag & Joffe Inc.

civil engineer: Bronte Engineering

landscape architect: douglas w. Kerr & associates Ltd.

contractor: carwell construction Ltd.

Welland, ON: Significant changes were made to the typical Canadian Tire store design and construction practices in order to achieve projected energy cost savings of 58 per cent, potable water savings of 46 per cent, and an improved indoor environment.

Much of the energy savings can be attributed to high-efficiency mechanical equipment and an innovative approach that uses different strategies for various building spaces. A ground source heat pump system both heats and cools the offices spaces, while a condensing boiler (rated at over 90 per cent efficiency) provides radiant floor heating in the cashier area. An energy recovery system uses waste heat from exhaust air (including that from the service centre) to pre-heat incoming ventilation air. A building automation system controls heating, cooling, and ventilation processes for optimum efficiency. The energy used to provide interior and exterior lighting was greatly reduced without sacrificing the store functionality or appearance. Interior lighting is controlled by both daylight

and occupancy sensors to achieve energy reductions of about 45 per cent relative to conventional retail store design. Gas, electricity, and water use will be monitored for a full year to ensure systems are working as designed. If needed, recommendations will be made in order to achieve the desired operating efficiency.

About 886 metric tons (or 95 per cent) of all construction waste was reused (asphalt and concrete) or sent to recycling facilities (steel and gypsum board). Construction materials for this store were selected for high recycled, locally sourced content. Regional materials represent about 67 per cent of the construction materials used.

With the installation of ultra-low-flow and low consumption water fixtures (urinals, lavatories, toilets, showers), this building will use 46 per cent less water than a similar building constructed to conventional standards. In addition, no water will be used for landscape irrigation since all the plants were selected based on their tolerance for drought.


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builDing a susTainable coMMuniTy: an energy anD infrasTrucTure perspecTiveajax, onTario – ocTober 1 For those who attended last year’s Durham Strategic Energy Alliance event, this year’s edition may have felt like one long déjà-vu. Want to see the Chevy Volt? Sorry, saw that last year. Want to hear about how successful Okotoks, Alberta has been in taking itself off the grid? Actually, I’ve heard that, too. At least SAIC’s Bill Wong, whose company helped create Okotoks’ solar community, Drake Landing, talked a little about how to recreate this pilot project. He actually said he hopes there can one day be a conference devoted to mistakes made and challenges faced in developing these kinds of innovative communities. And for those attending for the first time, this was an informative, well put-together event. Peter Berg talked convincingly about the “iPod generation’s” desire for efficient travel, though not necessary for a private vehicle. “They don’t care how they get from A to B,” said Berg. “They just want to get there.” Details at forum.dsea.ca

ReEvents

norTH aMerican sTraTegic leaDersHip foruMwasHingTon, Dc – sepT. 21-24CG/LA Infrastructure’s forum (see page 35 for more coverage) culminated with the Infrastructure Project of the Year awards ceremony. The North American projects honoured (some of which appear on ReNew Canada’s own Top 100 list of Canadian infrastructure projects) represent almost $400 billion in new investment and, according to CG/LA Infrastructure, have the potential to put six million people to work. Details at cg-la.com/leadershipforums

ciTies anD public policyToronTo – sepTeMber 24-26The Institute of Public Administration (IPAC) put on a two-day talkfest at a time when our industry has a lot to talk about. Some of the speeches sounded like campaigning—not surprising since that same day, Toronto Mayor David Miller announced he would not be running in 2010. Canadian Urban Institute’s Glen Murray, former mayor of Winnipeg, addressed the crowd of planners and professionals, saying, “Some of you have a lot of ideas, and a lot of passion. You can always run—do something about it.” Urban Strategies’ Joe

Berridge was most impassioned of all, saying, “Every time you do something in the city, don’t just do it, do it beautifully.” Details at ipac.ca

TD greaT canaDian sHoreline clean up ToronTo – sepTeMber 27The first event through our charitable organization, Actual Karma, had Actual Media staff digging their wellies out of the closet for a good cause. We cleaned up the shoreline of the Humber River and found, among the plastic bottles and metal cans, shopping carts, a series of car parts, half a bike, and a few other unmentionable items stuck in the knee-deep mud. Details at actualmedia.ca

Cred

it: Hilary V

aillancourt

Left: James Sbrolla and Mira Shenker proudly display the bicycle they dug out of the shoreline. Right: ReNew Canada publisher Todd Latham and researcher Hilary Vaillancourt survey the fruits of our labour: piles of trash.


http://www.rpic-ibic.ca/en/events/2010fcsnw/index.shtml

T his past May, I was the moderator of a lively University of Toronto session on water investment. One of the presenters was Bruce Pardy, a law professor at Queen’s University, who

presented eight water policy myths. His premise is that, in Canada, the conversation about water suffers from at least eight pervasive myths. This inspired me to come up with my own list of myths for infrastructure in Canada.

we’re doing better than other countries

While we may be ahead of our U.S. counterparts on understanding and managing public infrastructure, countries like Sweden, New Zealand and Australia are way ahead with asset management and sustainable funding regimens. We need to keep learning from other jurisdictions and adopt more progressive governance and public policy initiatives.

it’s all about roads and bridges

Transportation infrastructure may be what people notice when they drive into work, but the subsurface utilities (pipes and distribution conduits for water, sewage, power and communications) are often far more in need of repair.

The canadian public understands

Taxpayers support infrastructure renewal as long as it creates new jobs, doesn’t increase their taxes and does not require user-pay structures or special municipal levies to pay for it. The party is over: citizens need to wake realize that quality of life is not free.

local governments are looking long term

If long term means to the end of an elected official’s term of office, then yes. But politics is a short-term game—unlike infrastructure, which is stretched over a 20 to 100-year term. In a parliamentary system, it’s easy to have a long-term vision, but almost impossible to implement it.

There’s little we can do about climate change

There’s a lot we can do personally to reduce our footprint. But, bigger than that, a recent Conference Board of Canada study has shown that 85 per cent of Canadian companies polled actually see “global warming” as a chance to profit. New regulations and a potential carbon market means opportunities for new products and services.

Closing Shot

By Todd Latham

five MyTHs Of canadIan InfRaSTRucTuRE

Todd is the founder of ReNew Canada. Bruce Pardy’s presentation on water myths has been adapted into an article which appears in the November/December 2009 issue of Canadian Water Treatment magazine. Feedback welcome: [email protected]

Cred

it: Todd

Latham

This photo was taken in Stockholm, Sweden (see page 34), where people only buy into one myth—that their hockey team has a chance at winning gold in the Vancouver 2010 Olympics.


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