Category Archives: Infrastructure

Renzo Piano & the Centro Botín

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In March this year, the Victorian Government unveiled the winning concept design for the NGV Contemporary, a new centre for art and design, forming part of the planned revamp of the Arts Precinct on Melbourne’s Southbank. Due to open in 2028, The Fox: NGV Contemporary (to give it’s full name, thanks to the benevolence of trucking magnate and close acquaintance of Premier Daniel Andrews, Lindsay Fox) is being heralded as an iconic, nation-defining statement in support of Melbourne’s claim to be the cultural centre of Australia. So far, so good – but I can’t help feeling the design competition has been conducted with some undue haste: Expressions of Interest were sought in March 2021, with a one-week registration deadline. The competition for Stage One of the project closed in August 2021, and Stage Two in November 2021, with the winning team announced in March 2022, barely 12 months from the EOI. Why the hurry (especially as Melbourne was in lockdown for much of that time), and up to now, there does not appear to have been any public consultation in the design process.

The Centro Botín, Santander, designed by Renzo Piano (image sourced from Wikimedia)

Contrast this with the design of the Centro Botín in Santander, Spain, by Italian architect Renzo Piano, whose story is told in an absorbing documentary, “Renzo Piano: The Architect of Light”. First, neither the architect nor the sponsoring Botín Foundation had any aspirations of creating an “iconic building”; instead, the goal was to have as minimal physical impact as possible, while reclaiming an area of land and returning it to public use. Second, there was a public consultation process, to overcome concerns expressed by some nearby residents. Third, while the documentary has no doubt been artfully edited, it does provide extensive “behind the scenes” access to the design and construction process over its 7-year development, which included a 3-year delay in completion. The fact that this was a private commission rather than a competition may account for this approach, but there was still a great deal of negotiation with municipal and community stakeholders.

The documentary itself is notable not only for the degree of transparency (we observe meetings between architect, client and project managers throughout the process), but also for the simplicity of its narrative, and the wise decision to dispense with any voiceover commentary – the subjects are allowed to speak for themselves. There are also references to cultural icons such as novelist Italo Calvino and film-maker Roberto Rossellini. The use of Mahler’s ‘Symphony No. 5’ in the soundtrack underlines Renzo Piano’s fascination with light as a construction material, as important to him as glass, concrete and steel – the music is most famously associated with the film of ‘Death in Venice’, a city renowned for its light.

If the primary inspiration for the design of the Centro Botín is light (and lightness of construction), I’m struggling, based on the available evidence, to see what the inspiration is for the NGV Contemporary. Despite being a statement about “art and design”, I fear that this project is as much about political statements and lasting personal legacies. Much has been made about the potential job creation during its construction, but much less about the design principles and aesthetic objectives. I hope this project does not turn into a municipal white elephant.

The original NGV (now referred to as NGV International) is a landmark building and one of the most popular destinations in Melbourne. I have known it most of my life, having first visited it aged 10, when it left an indelible impression on me. Having lived in Melbourne the past 20 years, I have been a regular visitor since it was extensively refurbished in 2003. As part of the Arts Precinct, the NGV is a focal point for the city’s cultural activities, and is a major draw card for local and international visitors. Any enhancement of the NGV and the surrounding facilities is generally to be welcomed, and certainly there are parts of the precinct that could do with upgrading. However, I’m not sure the design for the NGV Contemporary is the right decision.

Aside from the hastiness shown by the NGV Contemporary’s design phase, I’m surprised that the winning design team, Angelo Candalepas and Associates, do not appear to have built any comparable projects, despite winning multiple awards for their past work. The Candalepas studio has designed many residential buildings (and I lived very happily in one of their first competition successes, ‘The Point’ in Sydney’s inner city suburb of Pyrmont), but as far as I can see, nothing on the scale, significance or importance as NGV Contemporary. The proposed design looks very “blocky”, notwithstanding the internal “spherical hall”, which is highly reminiscent of New York’s Guggenheim Museum. It’s also not clear what the spacial relationship will be with the existing NGV and other neighbouring buildings, nor whether any of them will need to be remodelled or demolished to make way for this latest addition. I’ve tried, without success, to find a map or ground plan of the proposed development, or any details on how the NGV Contemporary will be accessed from adjacent streets, other than via a new garden that appears to envelop the NGV International – so what existing land will this garden occupy, and what current facilities might be lost in the process?

In conclusion, since its opening in 2017, the Centro Botín appears to have been enthusiastically embraced by the residents of Santander, and manages to be both utterly modern and easily accessible, unlike so many other examples of “statement” architecture. I hope we will see a similar outcome for NGV Contemporary.

Next week: Mopping up after the LNP

“What Should We Build?”

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Over the past week, the Leader of the Federal Opposition has been asking a series of questions on Twitter and elsewhere, about “what should Australia be building?”. As well as building the foundations of Labor’s Federal Election policy platform for boosting jobs in the manufacturing sector, it also provides lots of photo ops for pollies in hard hats and hi-viz clothing. (I do wonder why the potential Prime Minister hasn’t thought of this idea before, or why he appears to not know the answer – isn’t that his job? It also makes me wonder whether we need Parliament anymore, since our elected representatives prefer to conduct their “debates” via Social Media and Press Conferences…. it would save a lot of time and money!)

By this time next year, Albo could be PM (Photo sourced from Twitter)

There has been no shortage of suggestions from the Twitterati, which fall into the following main categories:

  • Renewable energy
  • Trains
  • Trams
  • Ferries
  • High-end engineering

But there has also been commentary around Labor’s ambivalence on the coal and gas sector (especially in the key state of Queensland), and the irony that we export cheap raw materials and import expensive finished goods. Then there is debate on the amount of local manufacturing content that already exists in Australia’s state-based trains and urban trams/light rail systems (skewed by the question of local vs foreign ownership). Plus, there’s the thorny issue of high-speed inter-city trains…

As I commented recently, the manufacturing sector accounts for fewer than 1m local jobs (less than 10% of the working population), and 6% of GDP. It has been declining steadily as a contributor to GDP since the 1960s, and more rapidly in recent years since we abandoned key subsidies to the car industry. I don’t think anyone is suggesting we return to the days of metal bashing and white goods. And while we’ve got to be selective about the type of manufacturing base we want to to develop, we also have to be realistic about the manufacturing capabilities we want to encourage and enhance.

The latter involves developing transferable skills, creating interoperable production lines, deploying modular designs and inter-changeable components, and recycling/repurposing. All of which should mean we don’t need to make every part of every item domestically, but we know how to assemble, service, maintain, repair and replace goods locally, and we can focus on adding value that can be fed back into the supply chain, which in turn can be exported (via know-how and services). Australia has some decent research and development capabilities, but we are not always very good at raising domestic investment, or commerciliasing our IP (so this value ends up being transferred overseas, with little to no return accruing locally).

I’m not a huge fan of simplistic “buy local goods/support local jobs” campaigns, or local content quotas. The former can degenerate into trade protectionism and economic nationalism; while the latter tend to favour inefficient incumbents within cozy duopolies (see the broadcasting and media sector). The current debate has also raised questions about procurement policies, and I for one would welcome a total revamp of government IT purchasing and deployment at Federal, State and LGA levels.

There’s also the consumer angle: Australians are notoriously “cost conscious”, so will they be prepared to pay more for locally-made goods, even if they are better designed, well-made and energy efficient, compared to cheaper, less-sustainable imports? (This is also linked to the question of wage growth and restrictive trade practices.)

The recent pandemic has highlighted some challenges for the structure of the local economy:

  • Disruption to distribution networks and supply chain logistics
  • Food security
  • Energy self-sufficiency
  • Inability to service equipment locally or source spare parts
  • Different standards across the States
  • Medicine and vaccine manufacture, sourcing and distribution

For an up-to-date perspective on where Australian manufacturing policy needs to be heading, I recommend taking a look at the Productivity Commission’s latest submission to a current Senate enquiry. (Am I alone in thinking that the PC, along with the ACCC, is doing more to develop and advance economic policy than our elected representatives?)

The PC’s submission addresses a number of key points:

  • R&D incentives are hampered by complex tax treatment
  • Policies (and subsidies) favouring one industry create uncertainty for others
  • Need for IP reform (especially “fair use” of copyright)
  • The National Interest test needs clarifying
  • More effort on up-skilling through more relevant education and training
  • The role of manufacturing capabilities in supporting supply chain infrastructure

Finally, while I agree that there needs to be some focus on renewable energy and public transport, we should not ignore food and agriculture, bio-tech, IT, automation, robotics, materials science and other high-end capabilities in specialist design, engineering and recycling (including reclaiming precious minerals from obsolete equipment).

(And did I mention the “Innovation Agenda” and the revolving door at the Federal Ministry?)

Next week: Dead Pop Stars

From R&D to P&L

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Last week, the leader of the Federal Opposition announced a $15bn reconstruction fund aimed at job creation if Labor wins government, saying Australia must be a country “that makes things”. With a specific focus on cars, trains and ships, this policy pledge sounded like a clarion call to the metal-bashing industries of old (and recalls either an 80s movie or a 60s pop song…). This followed the launch by the Victorian government of the $2bn “Breakthrough Fund”, aimed at enhancing the State’s R&D capabilities.

While this type of government largesse and targeted economic stimulus sounds welcome, I can’t help feeling the money could be better spent on covering some basic building blocks in the search for innovation and economic development – upgrading the primary, secondary and tertiary education for the 21st century (e.g, an integrated STEAM curriculum); funding budding entrepreneurs (e.g., job maker for the newly self-employed, especially those under 25); enhancing the SME loan market (e.g., making it easier to access working capital without first having to own real estate); and overhauling the procurement and “panel” regimes in the public and private sectors (e.g., giving more equitable access to start-ups and scale-ups).

The “reconstruction fund” talks about making equity stakes, and co-investing with the private sector and superannuation funds. This sounds great, but is it the role of government to pick winners? Surely it should be in the business of enabling innovation and facilitating the growth of SMEs (which is where much new employment is created, rather than in legacy industries and/or declining sectors). Also, because of the way their mandates are written (as well as their ROC models and fiduciary duties), traditionally, superannuation funds and other institutional investors find it very difficult to write cheques for less than, say, $200m. Such a figure is generally far beyond what most start-ups or scale-ups are seeking – so these institutional funds are often placed with external managers who can slice them up into smaller allocations, which adds to the overall investment costs.

The role model for the $15bn fund is the Clean Energy Finance Corporation, which returned a cumulative 4.75% as at June 30, 2020. Certainly a higher return than the cash rate, but hardly competitive with other asset classes or investment returns, if that is a key measure of success. The CEFC performance is currently running below its own benchmark, and while the efforts of the CEFC have no doubt led to more jobs in the renewables and sustainability sectors, hard data is not easy to come by. In its favour, the CEFC has made a large number of small scale investments, which may well provide a template for Labor’s manufacturing fund (although it’s not evident what form those investments have taken).

In speaking to a range of people over the past few weeks (civil servants, start-up founders, VCs, CEOs of listed companies, etc.), the following mixed messages emerged:

  1. Well-meaning government officials tell you that they are “here to help” founders, start-ups, entrepreneurs, SMEs etc. Problem is, these bureaucrats can’t effect necessary systemic change in the way innovation is funded – they can only operate at a transactional level. Also, many entrepreneurs would politely suggest that the government could do more by getting out of the way…
  2. One VC took issue with my suggestion that Australia needs a better manufacturing supply chain that produces more local components that are interoperable/interchangeable, and which also encourages more user-serviceable (and therefore more sustainable) devices and appliances – he was advocating in favour of sealed units and thus a continued dependance on the manufacturer/distributor service model; whereas I think self-sufficiency in manufacturing also means more consumer choice in post-sales support.
  3. An innovative Australian fintech chose to list overseas because the local capital markets did not “get” its business model, while another locally-listed fintech faced similar obstacles with its own listing.
  4. A start-up founder looking for a modest amount of money for an R&D project (in the sustainability sector) had already secured an equal amount of funding “in kind” from a government agency – but was finding it somewhat difficult to match it with the equivalent private capital.
  5. Neighbours building a passive house have had to import energy-efficient triple-glazed window units – because they are not easily available locally, and the only supplier they could find would have cost at least 50% more.

Finally, the new Labor policy (especially if it aims to support the EV sector) will need to demonstrate it has learned the lessons of Australia’s subsidised car industry, and that the proposed fund is part and parcel of an integrated approach to public transport infrastructure, encompassing high-speed inter-city trains, smart cities with self-drive vehicles, better orbital routes connecting suburbs, and regional hubs that aren’t reliant on cars.

Next week: Synchronicity

Startupbootcamp’s Virtual Demo Day

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Not to be defeated by the Victorian government’s Stage 3 Covid19 restrictions, Startupbootcamp decided to stream the latest Energy Australia Demo Day online. It was a bold move given that a key value of these events is the opportunity to see and meet the startup founders in person. But to the organizers’ credit, and with support from their corporate sponsors and mentors, as well as the founders themselves, it was an impressive event, and managed to connect the teams with their audience effectively.

The nine projects in the order they presented (website links embedded in the names) were:

17TeraWatts

Focused on “meeting the demands of the new solar customer”, 17TeraWatts monitors residential solar energy systems via a combination of data automation and behavioral science. It achieves this via “Bodhi 2.0”, a digital assistant for modern energy companies, designed to be the “heart and brains of home energy systems”. Once installed, it is forecast to to generate a recurring revenue stream for the 25-year life of a solar system, by delivering reporting and customer leads. At the other end, solar consumers are willing to pay for more information about, awareness of and control over their energy systems ans consumption. Currently exploring a partnership with DiUS, Bodhi 2 is also being deployed by a Victorian electricity retailer.

Renbloc

Another team addressing energy efficiency management, Renbloc provide a solution to help consumers by bringing transparency to the verification of renewable energy sources. For a monthly fee, it brings real-time monitoring and optimization to consumer energy consumption. Renbloc are also working with companies such as Asahi and Energy Australia to provide verification “certification”, a form of energy labelling that can be applied to a wide range of consumer products.

Machine Dreams

The founders at Machine Dream are deploying machine learning and data analytics to monitor equipment failure, by detecting defective power assets owned and managed by energy distribution networks. Using system-generated photos to train the algorithm, Machine Dream claim significant reduction in the time and cost it traditionally takes to monitor network equipment, and with higher accuracy rates. The overall effect is to enable the frequency of assessment, and the reduce the cost of assessment. Currently in trials with Ausnet to monitor the “poles and wires”, Machine Dream can also be used for other infrastructure assets such as bridges, railway tracks and roads. The team plan to offer licensing and SaaS business models to asset managers and manufacturers.

GenGame

This is a customer engagement platform, delivering consumer apps for energy retailers to help their customers track retail energy bills (optimization, rewards, incentives, etc.) using customized profiles. The founders claim that customer relationships become stickier, via the low cost/low touch engagement. The team comprises a mix of creatives, energy industry experts and software developers to license client solutions which are priced on the set-up costs and the number of end users. Apparently, only 10 out of 40 energy retailers in Australia have a mobile app, and GenGame has two pilot projects with Energy Australia.

Energy Master

Another solution for energy efficiency, Energy Master is focused on helping corporate clients manage their utility bills. Essentially a business information platform, the application reviews consumption, taxes and fees, tariffs and off-sets, carbon reduction and water savings. It charges 0.5% of managed energy costs as a recurring fee, and does not require any hardware investment by clients. Currently running clients trials with Energy Australia.

ELDO MeterStack

This team is also addressing energy data analysis, but at the level of the grid, particularly at the fringe end of the distribution network. Their thesis is that consumers are not engaged, and don’t know how to understand their utility data or how to value it; meanwhile, energy companies cannot access consumer data. Positioned as a data market place between consumers and energy service providers, it offers a turnkey solution for the new breed of “digital utility” companies, and is working with DiUS and MHC to support distributors and the fringe of the grid.

Energos

Describing its solution as “intelligent nodes for distributed energy systems”, Energos is using AI for energy monitoring, management and optimization. Focused on business and industrial clients, the system can operate across multiple sites and in multiple countries, ideal for multinational corporations. Adopting a monthly subscription fee model, Energos is working with Energy Australia on a pilot solution for a business client.

BEAD

Using a combination of sensors and software, the team at BEAD are delivering intelligence solutions to help building owners, managers and occupants to manage “over heating, over cooling, over lighting”. With tag lines such as “listening to your building”, and “intelligent buildings you deserve”, BEAD is aimed at telcos, smart cities and BMS & HVAC vendors. Their system analyses occupancy flow, and develops digital models of buildings to track body heat (an important consideration in the Covid19 era, as well as events such as building fires, floods and earthquakes). They also work with building insurers to deliver real-time monitoring via Blockchain and smart contracts. Claiming to deliver 30% savings in energy optimization and efficiency, BEAD is working with Energy Australia, Hydro Tasmania and Asahi.

Liquidstar

This startup deploys Blockchain enabled apps to monitor their partners’ IoT connected hardware (batteries and container charging stations). Liquidstar is an IoT solution designed to build a “wire-less grid”, with the aim of removing diesel and methane power from communities that do not have access to grid networks. One potential use case could be in battery management for Covid19 quarantine centres.

Next week: Can we come out now?