In the upcoming issue of Dimensions: Annual Review, we’ll reflect on the past year’s achievements. With the help of our newest board members, Terry Boston and Geraldine Knatz, both recognized leaders in their fields of power and ports and intermodal, respectively; we also decided to look forward to where our industry is headed. In this week’s blog, we published the full account of a discussion they recently shared.

Barry Dewberry: What near term market forces do you think will be most impactful to our clients?

Geraldine Knatz: Transportation leaders are worried about declining transit users. Transportation network companies (TNC) like Uber are having an impact, and our older population is reducing its use because of security concerns. State leaders don’t like running nearly empty buses when a TNC could provide that service. So some states are shifting their focus to “mobility.” How this may appear in agency budgets is hard to say—and on the horizon is autonomous vehicles!

Terry Boston: Natural gas and renewables, and the infrastructure to deliver these low-cost energy resources to population centers, will continue to be a market disruptor—as will the electrification of transportation and artificial intelligence for autonomous vehicles. We’ll see micro grids. They’ll be tied to the grid but will isolate as backup power during extreme weather events.

Dewberry: What infrastructure issues are upper most in the minds of industry leaders?

Knatz: Overall, international trade is up this year, and the economy is doing better. So what else do industry leaders worry about? Severe weather events and resilience—both of which can significantly impact our supply chain. Resilience planning is challenging because of the need to address governance, decision-making, and social capital.

Boston: In the energy sector there is good news in two areas: the availability and price of natural gas and continued progress reducing renewable energy’s capital cost. Capital costs have continued to fall and all-in cost is in parity, or cheaper, than conventional resources. For the first time in my career, energy independence is a real possibility. Low-cost energy will drive and invigorate our economy.

Dewberry: Do you have a favorite success story of a public-private partnership?

Knatz: I had the luxury of working for public enterprises who were able to finance its own projects; so I don’t really have a favorite public-private partnership story.

Boston: I’ll help out Geraldine and give you two: Following the 2001 California energy crisis, a public-private partnership was developed to build Path15, a third north to south 500 kV line in California. By using private-sector dollars and Western Area Power Administration right-of-way, it got built very quickly. My second favorite story follows the August 14, 2003 Northeast blackout. The need for high-resolution, time-synchronized data became obvious. The Department of Energy and industry put together a public-private partnership to build out a network of phase angle measurement units, taking readings at 30 samples per second. This network has greatly improved both operations and root cause analysis following extreme events on the power system. In both cases public-private partnerships worked well because a crisis had to be solved.

Dewberry: As you see it, where is leadership at the regional, state and/or local level within the U.S. doing well to generate funds and promote infrastructure development? What is it about these areas that makes this possible?

Knatz: California is doing well on infrastructure development, because we love to tax ourselves to pay for it! So leadership at the state and local level have been able to convince voters these problems need to be tackled right away. Currently the State of California has a budget surplus. I see a lot of action at the city and regional transportation authority level. Also, the City of Los Angeles has stepped up to host the Olympics in 2028. Ten years is not that far away. There are other cities that will host venues for the Olympics—like Long Beach where there was a successful ballot measure to raise money for infrastructure. Long Beach has already identified 10 projects it must do before the Olympics.

Boston: In the case of pipes and wires, financing the projects is not the issue. The issue is for state and federal regulators to work together for the good of the nation to approve and site interstate pipelines and transmission lines; and to allow the purchase of private property rights for the public good. Texas has achieved this by building lines to move West Texas wind and solar to populations centers. Texas’ culture supports the benefits associated with low-cost energy to grow the economy and add jobs.

Dewberry: Where do you think the U.S. should concentrate its limited resources in infrastructure development?

Knatz: To maintain our global market position, we need to concentrate on “gateways.” Big airports, seaports, cities. Wouldn’t it be great if the U.S. had a “capital plan?” You know someone who looked at our entire country and prioritized infrastructure investment to maintain our competitiveness? I admit I’m biased to freight infrastructure being the highest priority.

Boston: Pipes and wires. Energy is the lifeblood of our economy and the lifeline to our homes. Our new shale gas resources are not where the conventional gas wells were, and large-scale cost-effective renewables are often far from population centers. Much like how railroads and interstates propelled our economy in the past, low-cost energy and its efficient delivery will determine our success in a digital economy.