Western Harbour Tunnel and Sydney Harbour Tunnel Asset Manager Model – Governance Outcomes

In 2022, Transport for New South Wales (TfNSW) implemented the Asset Manager model for delivery of the Western Harbour Tunnel and Sydney Harbour Tunnel, pioneering a unique approach to infrastructure procurement. The Asset Manager model, the first of its kind, leverages the expertise and resources of the asset owner, design and construction contractor, and asset manager to achieve improved sustainability and whole-of-life outcomes, underpinned with an Infrastructure Sustainability rating.

The key features of this model include the early procurement of the Asset Manager, who contributes their expertise into the design, procurement, and construction phases. This ensures that whole-of-life considerations are incorporated from the beginning, leading to resource savings, knowledge sharing, and optimised performance.

TfNSW recognised the importance of whole-of-life solutions for the long-term performance of the Western Harbour Tunnel. They sought an Asset Manager organisation with demonstrated expertise in tunnel operations, maintenance, and lifecycle management. By incorporating the Asset Manager's input early in the project, TfNSW ensured that their recommendations were appropriately incorporated when the cost and ease of change were still low.

To achieve early input, the Asset Manager needed to be involved in conjunction with the design and construction procurement. TfNSW considered various models such as DCOM, PPP, and the Asset Manager model. They recognised that the independence of the Asset Manager was crucial for obtaining the best whole-of-life advice. Consortia often have obligations that prioritise their own interests, which may not align with optimising whole-of-life outcomes. By pursuing the Asset Manager model, TfNSW could select the best Asset Manager based on merit alone.

TfNSW also aimed to attract greater investment in asset management capabilities to Australia. They were concerned about the skills and capacity available in the market and wanted to retain the knowledge of the incumbent staff on Sydney Harbour Tunnel. The Asset Manager model addressed these concerns and provided a framework to encourage investment in asset management and sustainability capabilities over the long-term.

Significant work was undertaken to develop the business case, service delivery model, commercial model, contract model, and contract administration tools necessary to implement the Asset Manager model. TfNSW collaborated with a range of advisors, led by CBS Group. The advisors included Infrastructure Advisory Group, Ashurst, Firecone, and CICA, who provided technical specification, market advisory, project management, transition management support services, commercial advisory, contract administration tools, and lifecycle modelling toolset.

The client representatives for this nomination are John Hardwick, Executive Director, Transport for New South Wales; Peter Murphy, Commercial Lead, Transport for New South Wales and Jeff Dusting, Principal Advisor, CBS Group.

The implementation of the Asset Manager model for the Western Harbour Tunnel project has yielded several outcomes that the potential to transform the way projects are procured in the future. These outcomes encompass various aspects such as optimised performance, reduced risk, improved customer outcomes, and enhanced sustainability. The community stands to gain significant advantages from these outcomes.

The outcomes of the Asset Manager model included:

1. Optimised Performance: By incorporating whole-of-life considerations from the beginning, the Asset Manager model achieves improved performance outcomes for the Western Harbour Tunnel. The expertise and knowledge of the Asset Manager contributes to better design, procurement, and construction decisions, leading to a more efficient and reliable infrastructure asset.

The public will benefit from E, S and G outcomes, with reduced travel times (and lower customer emissions), improved journey experiences, and increased accessibility. With optimised performance, the tunnel will be better equipped to handle the growing transportation demands of the community, ensuring smoother and more reliable connections between different areas. This contributes to a more connected and accessible community, facilitating economic growth, social interactions, and overall quality of life.

2. Reduced Risk: The early involvement of the Asset Manager helps to identify and mitigate risks throughout the project lifecycle. By considering the long-term implications of design and construction decisions, potential risks are addressed proactively, minimising the likelihood of disruptions and costly remedial actions in the future.

The community will benefit from increased safety and reliability. The Asset Manager model's risk mitigation efforts minimise the chances of incidents or unexpected failures, ensuring a safer transportation environment for users. This is especially crucial for a major infrastructure asset like the Western Harbour Tunnel, as it serves as a vital link for commuters and freight transportation. Reduced risk leads to increased confidence in the system, attracting more users and contributing to the overall well-being of the community.

3. Improved Customer Outcomes: The Asset Manager model prioritised customer-centric solutions. By considering the entire lifecycle of the asset, including operation, maintenance, energy consumptions/emissions and user experience, the model ensured that the needs and expectations of the customers were met effectively. This resulted in enhanced safety, convenience, and overall satisfaction for the users of the Western Harbour Tunnel and Sydney Harbour Tunnel.

The community will benefit from enhanced convenience, comfort, and satisfaction. The Asset Manager model focuses on factors such as user safety, accessibility, and service reliability. By incorporating these considerations into the design and operation of the tunnel, the model aims to provide an improved journey experience for commuters. This includes factors like well-maintained facilities, effective signage, efficient traffic management, and user-friendly interfaces. The improved customer outcomes contribute to a more positive and seamless travel experience, enhancing the overall liveability of the community.

4. Enhanced Sustainability and Resilience: Incorporating whole-of-life thinking into the project enables TfNSW to address sustainability and resilience challenges. The Asset Manager model facilitates the integration of sustainable practices, such as energy-efficient operations, eco-friendly materials, and proactive maintenance strategies. This approach ensured the long-term viability of the asset while minimising environmental impact.

The shared benefits from reduced environmental impact and increased resilience. Sustainable practices employed in the Asset Manager model lead to lower energy consumption, decreased carbon emissions, and minimised resource waste. This contributes to mitigating climate change and improving air quality, benefiting the overall well-being of the community. Additionally, the emphasis on resilience better prepares the tunnel to withstand environmental challenges such as extreme weather events, ensuring uninterrupted transportation services for the community even in adverse conditions.

All outcomes will be quantified and independently verified via the IS for Operations rating. An IS for Operations score of 50 is being targeted within the first three years, with progressively increasing performance to a score of 75+ by 2032, which should deliver the community some of the best performing infrastructure in Australia.

The implementation of the Asset Manager model by TfNSW resulted in benefits for various stakeholders involved in the Western Harbour Tunnel and Sydney Harbour Tunnel:

1. TfNSW and Government: TfNSW, as the asset owner, and the government benefited from the Asset Manager model through improved whole-of-life outcomes for the Western Harbour Tunnel. The model provided a framework for better decision-making, risk management, and cost optimisation. By incorporating asset management principles and expertise early in the project, TfNSW achieved enhanced performance, reduced long-term costs, and increased infrastructure resilience.
2. Design and Construction Contractors: The Asset Manager model enables design and construction contractors to collaborate effectively with the Asset Manager and incorporate their whole-of-life input. This collaboration ensures that the contractors' designs and solutions align with long-term asset management goals. Contractors benefit from the knowledge sharing, cost savings, and reduced risk associated with the early involvement of the Asset Manager.
3. Asset Manager Organisation: The Asset Manager involved in the project benefits from the opportunity to contribute their expertise and influence the design and construction phases. Their early involvement allowed them to shape the project in a way that maximised whole-of-life outcomes and optimised the asset's performance. The model provided a platform for the Asset Manager to showcase their capabilities and demonstrate the value of their services, whilst reducing risk and environmental impact from the ongoing operations and maintenance.
4. Users and Community: The ultimate beneficiaries of the Asset Manager model are the users of the Western Harbour Tunnel and the broader community. The model ensured improved customer outcomes, including enhanced safety, reliability, and convenience of transportation. By incorporating sustainable practices, the model also contributed to a more environmentally friendly infrastructure asset, benefiting the community at large.
5. Industry and Knowledge Sharing: The Asset Manager model serves as a pioneering example for the infrastructure and asset management industries. By sharing the outcomes and lessons learned, the model contributes to the advancement of best practices in asset management, encouraging industry-wide improvements in project procurement and long-term performance optimisation.

The implementation of the Asset Manager model delivers benefits to TfNSW, government agencies, contractors, the Asset Manager organisation, users of the infrastructure, the broader community, and the industry as a whole. The model's collaborative and whole-of-life approach ensured that multiple stakeholders reaped the advantages of improved governance outcomes and sustainable infrastructure development.

The implementation of the Asset Manager model by TfNSW will leave a lasting legacy and made a significant contribution to the United Nations Sustainable Development Goals (SDGs). The model's unique approach and emphasis on whole-of-life outcomes have positively impacted several SDGs, promoting sustainable infrastructure development, responsible consumption and production, and industry innovation.

Legacy:

1. Transforming Procurement: The Asset Manager model has established a benchmark for the procurement of major infrastructure projects. Its successful implementation demonstrates to industry the importance of whole-of-life considerations in the delivery of infrastructure, as well as the effectiveness of integrating sustainability practices with asset management. The legacy of the model lies in its potential to revolutionise procurement practices, encouraging other organisations to adopt similar approaches and achieve improved governance outcomes.
2. Industry Collaboration (SDG 17): The Asset Manager model promotes collaboration, cooperation, and partnership among all stakeholders involved in the Western Harbour Tunnel and Sydney Harbour Tunnel project. This legacy of collaboration has the potential to transform the industry's approach to infrastructure development. By fostering a culture of shared knowledge, expertise, and responsibilities, the model encourages collective efforts towards achieving sustainable and resilient infrastructure assets.

UN SDG Contribution:

1. Sustainable Infrastructure (SDG 9): The Asset Manager model directly contributes to SDG 9, which focuses on building resilient infrastructure, promoting inclusive and sustainable industrialisation, and fostering innovation. By incorporating whole-of-life considerations and sustainable practices, the model ensures the development of infrastructure assets that are economically viable, environmentally friendly, and socially inclusive.
2. Responsible Consumption and Production (SDG 12): The Asset Manager model aligns with SDG 12 by promoting responsible consumption and production practices. Through early involvement and whole-of-life thinking, the model facilitates the optimisation of resources, reduction of waste, and efficient use of materials throughout the lifecycle of the infrastructure asset. This approach contributes to sustainable consumption and production patterns.
3. Industry Innovation and Infrastructure (SDG 9): The Asset Manager model encourages innovation in the infrastructure sector by challenging traditional procurement models and introducing a novel approach. Its emphasis on collaboration, early involvement, and asset management principles fosters innovation in design, construction, and asset performance optimisation. The model promotes industry-wide advancements in infrastructure development and governance outcomes.
4. Sustainable Cities and Communities (SDG 11): The Asset Manager model indirectly contributes to SDG 11 by enhancing the quality, safety, and resilience of urban infrastructure. By prioritising customer outcomes, incorporating sustainable practices, and minimising risks, the model ensures the provision of efficient and reliable transportation infrastructure. This contributes to creating sustainable and inclusive cities and communities.
5. Climate Action (SDG 13): The Asset Manager model aligns with SDG 13 by considering climate change mitigation and adaptation in infrastructure development. By incorporating sustainability and resilience principles, the model contributes to reducing the environmental impact of transportation infrastructure. It encourages the adoption of eco-friendly technologies, energy-efficient operations, and climate-resilient design strategies. Importantly, the Asset Manager retains responsibility for electricity volume and incentivised to drive down consumption and emissions.

The legacy of the Asset Manager model lies in its potential to transform procurement practices and promote sustainable infrastructure development. By aligning with multiple SDGs, the model contributes to the broader global agenda of achieving a more sustainable and resilient future. TfNSW's pioneering approach sets an example for other organisations and reinforces the importance of considering whole-of-life outcomes, collaboration, and innovation in governance and infrastructure projects.

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