Could accommodating your construction workforce delay your project?
Accommodating the construction workforce for major projects has generally been an issue dealt with as an afterthought, almost when the contractor is ready to roll onto the site. But the rental accommodation crisis affecting much of Australia has seen this issue become a major concern for communities and local and state government agencies. Failing to proactively plan for your construction workforce accommodation from the outset, could potentially add another 12 months to your project timeline.
Accommodation availability for REZ developments
The urgent need to develop Renewable Energy Zones (REZs) in regional areas has collided with the rural housing crisis.
Rural housing crisis: short-stay accommodation demand in NSW towns is dire news for long-term locals (The Guardian, 11 March 2023)
State governments are encouraging wind and solar farms to locate in the REZs, with examples including the New England REZ centered on Armidale in NSW, or the Murray River REZ around Kerang in Victoria. The pace of development in these REZs is increasing, and as an example the NE REZ is designed to provide 8 GW of generation, which could include more than 15 major solar and wind farms. In addition, the transmission lines to transport the energy need to be constructed, being multi-billion-dollar projects themselves. However, the rural communities which host REZs have relatively small populations. Therefore, the labour needed to rapidly up-scale construction of renewable energy projects largely needs to be sourced from outside of the region, generating demand for accommodation in areas with limited availability. For example, research in the NSW Central-West Orana REZ, centred around Dubbo and Mudgee, with an existing population of around 300,000 people, has predicted a cumulative construction workforce of over 5000 will need accommodation throughout 2025-6.
Results from engagement with communities across REZ’s such as Central West Orana, New England and South-West, clearly demonstrate that stakeholders have become increasingly concerned and agitated about the effects the influx of a workforce can have upon local housing markets and community well-being. Rural towns in REZ areas have a highly limited supply of housing and accommodation. Therefore, a relatively small increase in demand has a pronounced effect on availability. This can result in serious social impacts as demonstrated by recently collected community feedback:
- The solar farm people offered triple the rent, so we were forced out. There were no rental properties available, so we ended up living at the caravan park. Then there was a big flood- we were lucky to survive.
- The regional soccer carnival had to be cancelled as there was nowhere for teams to stay as all accommodation has been booked out by project workforces
- I needed access to emergency accommodation and it turned out there was no where to stay.
Managing the issue
These outcomes need to be avoided. Regulatory agencies are accordingly requiring renewable energy proponents to submit a ‘Workforce Accommodation Strategy’ as a pre-requisite of project approval.
This work needs to be undertaken early, as it can have a significant impact on the EIS and approvals process. Developers of projects generally have a number of options for managing this issue; they can:
- Argue there is sufficient available accommodation for their expected workforce within the locality, drawing on a combination of rental accommodation, tourist accommodation (motels, caravan parks etc) and sometimes available institutional accommodation.
- Propose to develop an onsite construction camp
- Propose an offsite construction camp
Option 1 will require demonstration there is sufficient accommodation available without undue impacts on the local rental market, or the tourism market.
Pursuing option 2 will often mean including the camp within the project description of the EIS, and therefore assessing all of its impacts including traffic, water usage, sewage disposal etc, as well as the social implications of a temporary workforce in the locality.
Option 3 may require a separate development application to the local Council, introducing potential delays and project risks.
EMM is uniquely positioned to guide renewable energy developers through this process. Our Social Assessment team possesses extensive experience analysing renewable project workforce requirements, advising on optimal accommodation solutions and thereby avoiding delays to achieving regulatory approval. We develop an accurate appreciation of where the labour needed for a Project will be sourced through analysis of the latest labour data and local and regional employment trends along with engagement with EPC contractors, labour hire suppliers and local stakeholders. We determine the total accommodation requirement across the construction phase and assess available accommodation options to derive the optimal accommodation solution which balances cost and efficiency considerations whilst minimising negative impacts on local communities.
As workforce accommodation is a key driver of Project derived social impacts, a proactive approach not only avoids delays to attaining regulatory approval, but also provides the foundation for community acceptance and support for the Project.