PLOTTING THE COURSE
8 BUSINESS PRIORITIES FOR THE NATIONAL
INFRASTRUCTURE COMMISSION
EMBRACING THE LONG TERM APPROACH
Whether Crossrail, £15bn of planned investment in the Strategic Road
Network or Heathrow Terminal 5 – recent years have demonstrated the
UK’s appetite for construction of the infrastructure we need to prosper.
With the creation of the National Infrastructure Commission, the UK has an
opportunity to ensure these examples are just the start of a new approach
to longer-term planning of our infrastructure – making sure we are well
placed now to tackle the challenges that the coming decades will present.
Whether it is upgrading our digital
connectivity to boost productivity, investing in
new energy sources to boost competitiveness
and meet our 2050 carbon targets, or
delivering new connectivity from our airports
to boost exports – taking key decisions
early will support our long-term economic
ambitions.
thorny issues at hand. Whether it’s the longterm strategy we employ to ensure security
of our energy supplies, or the role that new
railway lines have to play in growing the
UK’s connectivity, the independence of the
Commission enables it to take a wider outlook
and grasp the opportunities of integration,
across sectoral and departmental lines.
What’s more, a long-term plan will ensure
we are able to deliver the projects required
to meet our future needs. It would enable our
infrastructure providers to establish robust
supply chains, our contractors to map out
the skills required, and our investors and
planners to think innovatively on how we best
deliver the infrastructure the UK will need.
In identifying the most pressing challenges,
businesses that use and operate the UK’s
infrastructure are well placed to help steer
the Commission. On the one hand, business
users understand well what makes the UK an
attractive place to invest, and it is they who
rely upon our national infrastructure to get
staff from A to B, grow their enterprises, and
build the UK economy. On the other hand, it is
infrastructure providers who understand the
current pinch points, and have earliest sight
of advances in technology.
By undertaking an evidence-based
assessment of long-term need, the
Commission presents an opportunity to
ensure our policies today are shaped by the
infrastructure we need tomorrow. It provides
businesses with a longer-term vision towards
which they can aim, while also ensuring
whether it’s a national set-piece project like
HS2, or smaller schemes like energy from
waste projects – UK infrastructure is pulling
in the same direction.
Yet the Commission also presents an
opportunity to explore how the UK tackles
specific challenges where a problem has
already been identified – issues where all too
often, political pressures and procrastination
prevents the UK from grappling with the
If the Commission is to mark a turning point
for long-term decision making, it is crucial
that its agenda not be way-laid by politics
– focusing instead on the challenges that
matter most to those who rely upon the UK’s
infrastructure.
While an assessment of the UK’s long-term
needs will take time to assemble, businesses
already foresee a number of long term
challenges that affect their investment
decisions. And so we have identified eight
priorities for the Commission to make
headway on…
8 BUSINESS PRIORITIES
ENERGY (Generation and Supply)
A diverse mix of technologies
ENERGY (Low Carbon)
Electrification of heat and transport
RAIL
A high capacity network
ROADS
The long term funding dilemma
DIGITAL
The arrival of 5G
WATER
Changing weather patterns
FLOOD DEFENCES
Climate change risks
PORTS AND AIRPORTS
Our national connectivity
These priorities, by no means a definitive list, set out one long term challenge for each of the UK’s infrastructure
sectors. This work is based on the understanding that the National Infrastructure Commission will be able to
examine specific challenges, separately from its overarching assessment of need. The priorities themselves have
been gathered on the back of the 2015 CBI-AECOM Infrastructure Survey, and in liaison with CBI members.
ENERGY (Generation & Supply)
A diverse mix of technologies
The future of UK energy generation has long
been framed within the commonly phrased
energy trilemma: security of supply; affordability;
and de-carbonisation. While all three dimensions
are important, it is the former which is seen by
businesses as paramount, with a diverse mix
seen as key to delivering this, for both local and
national markets. This mix must ensure the UK
is able to extract and store energy from a wider
range of sources, and is better at embracing
the opportunities of the circular economy,
for example capturing energy from waste.
Such diversity requires an environment which
develops the range of existing technologies and
fosters the creation of new and innovative ones,
while managing the costs involved.
The challenge for the commission
How can a pipeline of new technologies
such as tidal, hydrogen, energy storage
and carbon capture and storage be
delivered, while keeping costs down?
Crucial energy priorities for UK
businesses(%)1
74
Security of Supply
43
Affordability
30
De-carbonisation
0
20
40
60
80
ENERGY (Low Carbon)
Electrification of heat and transport
Technological advances, whether electric cars,
the growth of CHP or electrification of rail,
present the UK with exciting opportunities
on how it creates a low carbon economy.
Decarbonisation means though that more and
more of our energy needs must be met through
electricity. Electrification of heat and transport,
as just one avenue of opportunity, could require
the UK to handle almost double our current peak
electricity demand: with the seasonal nature
of heating demand also creating significant
variation in the level of electricity needed at
different times in the year.
The challenge for the commission
What upgrades to electricity generation
infrastructure, both through the grid
as well as in households, are required
to enable electrification of heat and
transport?
93%
The increase in current peak electricity demand
needed for high electrification of heat and transport2
100
RAIL
A high capacity network
The revival of rail in the UK since the 1980s
was largely unforeseen, and it has left our
network at risk of becoming a victim of its own
success. The need for increased capacity is
the top rail priority for 90% of businesses . The
National Infrastructure Commission has the
opportunity to creatively map out, not only how
we meet future demand, but how we continue to
encourage a greater role for rail. New schemes,
such as HS2 and Crossrail2, have the potential
to dramatically expand our capacity, but the UK
must also harness electrification, digitalisation,
and high speed technology, to maximise the use
of existing lines. Managing demand effectively is
also key to integrating rail with other modes of
transport - without creating pinch points.
The challenge for the commission
How should digitalisation, electrification
and high-speed technology be utilised
to help create a high capacity network
across the UK?
National rail journeys in Great Britain
1950 – 20153
1,600
1,200
800
400
0
1950
1963
1976
1988/89
2001/02
2014/15
ROADS
The long term funding dilemma
With almost two-thirds of all journeys taking
place by road, the state of the UK’s road network
is one of the key indicators of the health of the
UK’s infrastructure, yet businesses see cause
for concern on a number of fronts. Whether it
is boosting maintenance spending to ensure
the free movement of traffic or investing in new
capacity, businesses are clear that the current
approach remains insufficient. The reforms to
Vehicle Excise Duty will help to halt the decline
in funding in the short-term, however the longterm future financing of the road network – and
who pays for it – remains unresolved. In some
parts of the country we are already seeing roads
funding coming from the fares of rail and tube
passengers.
The challenge for the commission
What is the long term solution to funding
upgrades and maintenance to the UK’s
Strategic Road Network and local roads
networks?
Factors within UK roads causing concern
for business(%)4
91
Quality of existing roads surfaces
86
Investment in new roads
85
Disruption from road works
62
Safety
46
Cost of road and vehicle taxes
0
20
40
60
80
100
DIGITAL
The arrival of 5G
UK digital infrastructure enjoys an unrivalled
perception amongst business users: almost ¾
of which found their services to have improved
over the past 5 years. Nevertheless in this
fast moving industry, business expectations
are ramping up, with only 41% of business
fully satisfied with the quality of their digital
connections5. Meanwhile international
competition has started to plough ahead, with
4G adoption rates in the UK considerably lower
than in Asian and North American markets.
To stay at the top of the international league
table on Next Generation Access, the UK must
continue to develop its mobile coverage and lay
the foundations for the arrival and roll-out of 5G,
in the next 10 – 15 years.
The challenge for the commission
How can the UK maintain world-class
mobile connectivity and lead on 5G
roll-out?
4G Adoption Rates(%)6
Korea
Japan
North America
Sweden
UK
0
20
40
60
80
100
WATER
Changing weather patterns
By the 2050s changing weather patterns will
have a significant impact on the UK’s water
infrastructure. In the south there will be an
increased focus on resilience to ensure a
secure supply of water: the amount available
is projected to decline by as much as 11% due
to climate change pressures. In the north
meanwhile, an increase in deluges of water over
short periods of time, will require infrastructure
which can utilise highly variable amounts. It
will be crucial that the future state of local
water supply is factored into the UK’s long term
planning for housing and infrastructure.
The challenge for the commission
How will the UK’s long term plans
for investment in housing and
infrastructure be aligned with future
water supply?
6-11%
The reduction in availability of water supply by 20507
FLOOD DEFENCES
Climate Change risks
Around one in six properties in England is
currently estimated to be at risk of flooding, with
the total number projected to increase up to 2.1
million by 2050. By this point, changes in climate
are anticipated to increase the likelihood of oneoff weather events. Government has committed
capital funding until 2021, but UK schemes
continue to be designed to a lower standard of
resilience than elsewhere - in the Netherlands,
defences guard against a one-in-1,250 year
event. Embracing ‘water capture’ upstream
would also allow better management of flooding,
and potentially help transform an environmental
threat into a valuable water resource.
The challenge for the commission
How can the UK ensure its flood
defences are resilient to the future
likelihood of extreme climate change
events?
2.1m
The potential number of properties
at risk of flooding by 20508
PORTS AND AIRPORTS9
Our national connectivity
The connectivity provided by the UK’s ports and
airports are critical to driving exports and trade,
however both face challenges. For airports, the
primary challenge is to increase accessibility
to direct long-haul routes in emerging markets
from across the UK – making the most of the
UK’s full range of existing capacity, rather than
relying solely upon expansion in the South East.
For ports, the longer-term challenge will be one
of capacity, with a forecast increase in container
cargo of 182% by 203010. Joined-up planning,
which includes integration with UK rail and
roads, will be critical to boosting investment
in our national gateways, guaranteeing the UK
enjoys the connectivity required to revitalise its
role as a trading nation.
The challenge for the commission
What is the longer term role of UK
ports and regional airports, and
what measures can help grow their
contribution to national connectivity?
Business satisfaction with UK air links(%)11
85
EU
84
US
64
Other established markets
61
Other UK regions
Emerging markets
0
20
45
40
60
80
100
For further information on this document,
or for a copy in large text format contact:
Marcus Corry
Senior policy adviser
T: +44 (0)20 7395 8141
E: [email protected]
References
1CBI-AECOM Infrastructure Survey 2015
2
Energy system impacts from heat and
transport electrification, ICE, August 2014
3National rail usage and performance:
social indicators, House of Commons
Library, November 2015
4CBI-AECOM Infrastructure Survey 2015
5The Mobile Economy, GSMA, Report
Series 2015
6
CCRA2: Updated projections for water
availability in the UK, The Committee for
Climate Change, 2015
7CBI-AECOM Infrastructure Survey 2015
8Climate Change and Risk Assessment,
UK 2012, Defra
9The National Infrastructure Commission
will not be examining the issue of
runway capacity in the South East, as
explored by the Airports Commission
10National policy statement for ports,
Department for Transport, 2012
11 CBI-AECOM Infrastructure Survey 2015
March 2016
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