• Dr. Moritz Püstow, Partner |

Guest article*

Highlights

  • The long-term consequences of the coronavirus crisis cannot yet be estimated with any certainty. But there will definitely be some changes to the planning and construction of infrastructure.

  • Modern technologies such as digital twins and the internet of things enable better planning, more efficient operation and predictive maintenance of infrastructure.

Infrastructure in Germany is in need of modernisation. Beyond long-standing deficits, the coronavirus pandemic has led to the emergence of new needs, for example in broadband networks and mobility. The federal, state and local governments are therefore now faced with the task of defining what infrastructure is needed post-Covid-19 and how this can be planned in a timely manner. 

The long-term consequences of the coronavirus crisis cannot yet be estimated with any certainty. This uncertainty creates a particular challenge for the planning and construction of infrastructure due to its long lifecycle. Scenario analyses can help to better assess future developments and prepare accordingly. It is important to initiate measures now, because waiting for certain circumstances to arise will only increase the existing infrastructure deficit.

Some key questions in this context are:

  • How will cities develop if homeworking stays?
  • How can infrastructure become a driver for achieving our sustainability goals even when budgets are tight?
  • How can supply chains be secured if borders once again become a reality?
  • What do we need for digitalisation to offer new opportunities for all?

Post-Covid-19 Infrastructure

In the future, we need a flexible and agile approach to planning, development and distribution for the infrastructure sector. Only critical infrastructure that is global, open (i.e. neutral), robust, secure and, above all, resilient will be able to provide the many services needed by people, institutions and businesses. 

The use of digital design and construction improves the reliable implementation of infrastructure projects. Modern technologies such as digital twins and the internet of things enable better planning, more efficient operation and predictive maintenance. 

New directions in urban development

The pandemic has changed the way we work. With people taking advantage of technological opportunities, new needs and expectations have emerged. Some companies do not want to go back to old habits, as they have seen such efficiency gains. Even after the pandemic, it is likely that a large proportion of employees will regularly perform their work from home. This will increase the demand for living space and the demand for quality of living, while at the same time making it less important for the home to be close to the workplace. The demand for houses in rural areas has already increased significantly in the past year. This development has led to a change in settlement areas and mobility and increased the need for infrastructure and services that facilitate commuting between the core city and the surrounding areas.

Mobility behaviour has also changed. During the coronavirus crisis, city dwellers got to know and appreciate their immediate surroundings in a completely new way, and the distances travelled on foot have increased significantly. This change in mobility behaviour could result in the need for "hyper-proximity". Paris, for example, is planning to transform itself into a "15-minute city" where all essential basic needs can be met within fifteen minutes by bike or on foot from one's front door. Similar plans are also underway in London, Barcelona and Portland. Cities could thus become healthier and more liveable environments. This is also the direction of the new National Cycling Plan (NRVP 3.0) adopted by the Federal Cabinet on 21.04.2021 with the guiding goal of seamless cycling in Germany.

Infrastructure as a driver for achieving sustainability goals

In its decision of 24 March 2021, the Federal Constitutional Court ruled that the legislator has a fundamental duty to initiate the transition to climate neutrality in good time so that later generations are not unreasonably impaired in their freedoms. The measures envisaged so far are insufficient for this purpose. 

For the federal, state and local governments, this means a rethink, especially in the design of transport infrastructure. According to the European Environment Agency, 27 percent of greenhouse gases in the EU are caused by the transport sector. Road transport accounts for about 70 percent of this. So far, it has not been possible to significantly increase the shares of rail and inland waterways in freight transport. According to the federal government's sustainability strategy, the share of rail should be increased to 25 per cent and that of shipping to 14 per cent by 2015. In fact, the share of rail transport in freight transport has stagnated at a low level for several years, while the share of inland navigation has even declined.

Nevertheless, transport emissions decreased by 8.7 percent in 2020 after years of stagnation. Further measures are needed to successfully continue this development. 

The economic stimulus package in response to the coronavirus crisis also focuses on sustainability: the e-car premium is to be increased, and the charging infrastructure and hydrogen technology are to be expanded. These measures can promote zero-emission transport just as well as taxing vehicles depending on their CO₂ emissions. The promise of a decade of rail with increased investment in the railway network is another measure to boost sustainability. Expanding public transport/regional rail transport, strengthening the cycle path network, reorganising local freight transport or pricing mobility based on routes (tolls) can be important instruments to further develop this trend.

Digitalisation: new opportunities for all?

Due to the coronavirus pandemic and the measures to curb the further spread of the virus, the state, companies and schools had to upgrade technology within a very short time in order to enable working and learning from home and to coordinate emergency response and health care. At the beginning of the first lockdown, there was some impressive improvisation. But even almost 18 months after the crisis began, it has not been possible to establish functioning standards for education or coordination, to give one example. That digitalisation in Germany is lagging behind is nothing new. In the Digital Economy and Society Index of the EU Commission, Germany ranks just in the middle of the EU states (12th place) and is behind Spain, Belgium and Malta.

The great uncertainty in the use of communication platforms, in the processing of health data or the insufficient specifications for school education have made it clear that a lack of European standards and a lack of independent solutions are a real obstacle to exploiting digital potential. Digital sovereignty is needed for faster decision-making and action. This includes a European legal and value system (with elements such as cybersecurity and data protection), software, technologies, data spaces (GAIA-X) and a communication infrastructure. 

To ensure that poor digitalisation does not damage competitiveness and increase inequality, the available funds must be utilised more quickly. From the funds of the Digital Pact, in which five billion euros were approved for the digitalisation of schools until 2024 (as a result of the pandemic, another 1.5 billion euros was added), only a fraction of the money had been called up by January of this year.

For the infrastructure sector, the current crisis is an opportunity to push ahead with transformation. The country needs new and different infrastructure to make living spaces, mobility, education and supply sustainable for new needs. Digitalisation of planning, construction and operation is key to achieving these goals in an agile and efficient way.

*This is a guest article by our colleague Dr Moritz Püstow (lawyer, partner and Head of Legal Public Sector at KPMG Law Rechtsanwaltsgesellschaft mbH).

  • Moritz Püstow

    Moritz Püstow

    Partner, Head of Public Sector, Rechtsanwalt, KPMG Law Rechtsanwaltsgesellschaft mbH

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