From the magazine

Opt for trenchless (or risk litigation)

When underground utility projects are in the planning stage, the choice of either trenchless or open-cut construction is often faced. While assessment of the construction costs and environmental impacts are usually fairly straightforward, the environmental and social benefits of trenchless construction are often ignored.

Because of reduced surface disruption, trenchless construction can promote protection of habitat and green space in the natural environment. In dense urban environments, trenchless methods can greatly mitigate impact to traffic, pedestrians and short-term loss of business amenity or property values. These indirect social and economic costs need to be better quantified so as to fairly evaluate construction options in the planning stage.

Social costs of open-cut

Social costs are incurred during construction when people are delayed and surface features are disturbed and cannot be reinstated easily. These costs are a function of the number of people disrupted, the length of time added to their travel and the value placed on that time.

Fortunately, traffic engineers can often convert the number of vehicles travelling through a zone impacted by construction into useable data. At the 1998 Australasian Society for Trenchless Technology Conference, Bried and Boyce suggested a methodology for evaluating these social costs. The formula is still applicable today: the estimated duration of the disruption is multiplied by the number of persons per vehicle impacted and the value of their time – for example, a percentage of their hourly wage.

The resulting figure estimates the traffic delay cost to the community. During the project planning phase, this cost can be added to the direct costs associated with the construction method causing the disruption.

The loss of local business amenity is harder to quantify. Business concerns include interruption to access, reduced availability of parking, and loss of visibility, all of which result in loss of revenue. Further, the longer the construction impact, the greater the chance customers will change their shopping patterns.

The American experiment

So how to put a price on business impacts? We can take a cue from public transit projects, which have linear impact neighbourhoods. For some construction projects in the United States, some transit agencies provide free temporary signage and parking to businesses – or even offer low-interest or forgivable loans to offset business impacts.

On light rail projects in Minneapolis and Cleveland, for example, loans of $US20,000 were available to businesses along the rail corridor that experienced a loss in sales due to construction. During a light rail project in Seattle, business loss was calculated by subtracting the revenue during the construction period from revenue during a comparable period of time. Business interruption payments were made, capped at $US25,000 for relocated businesses and $US30,000 for one year only for non-relocating businesses and based on demonstrated need.

Opt for trenchless (or risk litigation)

While it may not be viable for smaller utility infrastructure projects to offer such business disruption pay outs or loans, these examples illustrate how to put an applicable value on such disruptions when evaluating trenchless versus open-cut at the planning stage.

These disruption impacts can then be manifested as a cost to councils and utility owners. In Vancouver, Canada, a lawsuit was initially awarded for $CA600,000 ($US484,300) for three years’ disruption during construction of a cut-and-cover section of the Canada Line.

The court found that public bodies and developers may be liable for using an economical but disruptive construction method when a more expensive – but much less disruptive – alternative exists.

More and more, owners are implementing mitigations to such risks in design and construction of projects. Although these mitigations come at a cost (business loans, pay outs, etc.), it is better to assess this cost at the planning stage. Thus, the best construction methodology is selected by an approach that does not ignore the wider impacts and benefits.

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