Infrastructure Australia's approach to infrastructure planning and investment has consistently emphasised the principle that infrastructure policy should include both supply and demand-side solutions.6
In light of this principle, once rigorous problem identification, assessment and analysis has been undertaken, a broad spectrum of options should be developed. The spectrum of options should represent a range of reasonable alternatives (both conventional and un-conventional) to solve the problems.
As outlined in its December 2008 report, Infrastructure Australia notes that significant aspects of the ongoing national demand-side reform agenda remains unfinished. It further notes that, given the potential for these reforms to address many of the problems facing infrastructure networks today, many capital investments should only take place after reforms are in place - and not before.
Figure 2 sets out graphically a possible framework for considering the range of reform and investment options.
Figure 2: Model for Considering Reform and Investment Options
| ||||||||||||
Reform options are likely to include:
Regulatory initiatives:
• Changes to the way both infrastructure and infrastructure services markets are regulated from a competition perspective, for example changes to regulatory regimes, access regimes, market structures and frameworks;
• Changes to the regulations surrounding markets: safety; environmental; technical standards; licensing; and
• Changes to land use and development planning and control to provide a land use solution to infrastructure issues.
Governance initiatives:
• Changes to administrative and institutional frameworks, such as public service delivery processes, approval processes, coordination and cooperation processes, assurance processes, contractual provisions, and funding agreements.
Better use initiatives:
• Technological innovations: intelligent active management systems, e.g. intelligent transport systems, smartcards, smart metering, product technical standards e.g. energy efficiency standards;
• Influencing behaviors through information: workplace practices, workplace travel planning; information labeling for energy and water intensive products; and
• Economic pricing and charging - the introduction of full economic pricing of energy and water sectors; for instance time of day pricing for transport and energy; full cost recovery pricing for water.
A key element of Options Generation is the consideration of how individual options can be packaged together - or better coordinated - for a more efficient and effective outcome.
______________________________________________________________________________________________
6 See, for example, Infrastructure Australia's Report to the Council of Australian Governments, December 2008, p.8.