Opus International Consultants partner Philip McFarlane reports that for every $1 invested in resilience projects, it’s possible to get returns of between $5 and $10.
“The United Nations quotes figures of a $10 return for every dollar spent,” he says. “And in the United States they talk about improvements to levies for stopbanks for which they say for every dollar spent they get a $6 return.”
Here in New Zealand, utilities company Orion estimated that the $6 million it spent on seismic strengthening saved it $30 to $50 million in direct asset replacement costs following the Canterbury earthquakes of 2010 and 2011.
Philip, who is also director of global asset management at Opus, says it’s sometimes hard to understand why resilience measures aren’t taken into account more often given such returns.
“Yet, it’s often difficult to convey a sense of urgency. It’s hard to explain why it’s necessary to build in improvements in case of an earthquake which many people think may not happen in their lifetime,” he says. “So more immediate priorities take precedence.”
Philip says resilience is about recovery of the system while also trying to make it more robust for the future.
He was speaking at the International Federation of Municipal Engineering (IFME) and Institute of Public Works Engineering Australasia (IPWEA) public works conference in Rotorua.
This article was first published in the July 2015 issue of NZ Local Government Magazine.