PPPs arrive at another junction
Click here for Volume 25 issue 2 of Partnerships Bulletin magazine.
The last editions of both Partnerships Bulletin and P3 Bulletin were cobbled together as the extent to which it became clear that climate change and Covid-19 were intertwined crises. The crises have converged to such a degree that the phrase ‘green recovery’ is now part of the international lexicon.
The result being infrastructure investment is widely accepted as a prudent next move for embattled societies and economies across the world. It has also become widely accepted that the green recovery is going to require vast amounts of investment from public and private sources, and partnerships.
Both the EU and UK’s strategies to reach net-zero emissions have pushed the infrastructure and energy sectors even closer together with any investment in each requiring the other to be considered. Particularly for energy transition where carbon-intensive economies and communities will require alternative assets to get their green deal.
In Europe the demand for both ‘energy efficient’ and ‘shovel-ready’ projects has manifested in the ‘Renovation Wave’ surging out of Brussels, and crashing into capital plans across the continent, including in Dublin, Edinburgh and London.
In this edition we take a closer look at how PPP fits in with the green recovery and the move to enhance public assets. Retrofitting is also part of the lexicon, but details on how such projects are going to be delivered at scale, and financed, are scarce at best. But clearly there is an opportunity for PPP, particularly if facilities are no longer fit for their intended purpose.
We also take a look at the expiry of PPP contracts and the handback process. While we expected there would be interest in both topics (we do try to be interesting), the response from the industry has been a real eye opener. Not just on how much interest there is in successfully managing the legacy of PPPs (with an eye on the future) but also how the topics are completely intertwined.
As Arsenal F.C renovated their season with yet another F.A Cup, nearby Islington Council decided it would bring services in-house after a housing PFI contract ended in 2022. Before making a decision on how to proceed with the expiry and handback process the council was required to consider environmental implications and contribution to achieving a net zero carbon borough by 2030.
The report approved by the council stated that no significant change to the overall impact is expected as a result of insourcing these services. Further it was agreed that it allows the council direct control over how they are delivered, potentially making it easier to make changes in future (such as adopting zero emissions vehicles) than it would be if the contract remained outsourced.
As infrastructure investment found itself at the intersection of the climate and coronavirus crises; PPPs have arrived at the junction of the green recovery and the transition of thousands of assets at the heart of communities.
Partnerships Bulletin and P3 Bulletin are about the opportunities for infrastructure investment partnerships present; those opportunities will depend on how the industry adapts to a net zero future in a post-Covid world.