Hang on tight; if 2024 is anything to go by, then 2025 is likely going to be a rollercoaster ride through change. Tim Clark looks back on a hectic year…
Delays, dilemmas, the demise of at least one major contractor; the past 12 months have been as tumultuous as any in the past decade for construction.
The year that was 2024 has seen some intriguing signs of a shift in the construction landscape, debates over how and what should be done over climate change and construction’s impact, and also a renewed focus on housing, as well as plans to speed up infrastructure decision making.
First off, the mega-projects.
January saw the Development Consent Order (DCO) activated for the mammoth new nuclear project at Sizewell C. The DCO is effectively the formal approval to begin construction and was followed by £1.3bn of government support for the construction phase.
Sizewell was awarded a nuclear site licence in May by the Office for Nuclear Regulation, and in August the new Labour government proposed a £5.5bn subsidy scheme for the reactor project. By the end of the year up to five investors expressed an interest in the Sizewell project, which has a cost estimate of between £20bn and £35bn.
There’s no doubt that Sizewell C is a hefty project in terms of expenditure. At that cost you could almost build a brand new railway line from London to Birmingham, or at least you’d like to think so.
High Speed to nowhere?
The year started with the industry getting to grips with the cancelling of HS2’s second leg, announced the previous October by the former prime minister Rishi Sunak. As 2024 comes to a close there were further revelations both in the scope (or lack of it) for the high speed rail line.
Responding to a written question posed by Lord Berkeley in Parliament just before the Christmas break, rail minister Lord Hendy said that the new station at Euston would have six platforms, one lower than under previous plans.
The HS2 antics act as suitable bookends for a year that saw the demise of one government, and a new one set out its agenda for transport. As it stands, the final cost for phase 1 is in theory unknown; a new delivery company is being set up to handle Euston station, the trickiest part of what was the first phase.
Labour has been coy over how it expects to handle HS2 going forward. It hasn’t hidden its scepticism for the project, but hasn’t backed an alternative either or fully laid out what it intends to do with the project going forward. All that is known is that incoming chief executive Mark Wild has a tough task to get the project back on track.
Curtain raisers
HS2 isn’t the only project to have hit the buffers in 2024. Earlier this year a major music venue in Manchester became the national centre of attention when it was unable to open, forcing major stars such as Eric Clapton, Take That and the Eagles to cancel or move gigs. The Co-op Live arena’s botched opening was a textbook example of ‘how not to do it’.
Commenting on the issues at the 20,000-seat arena John Ryan, founder of Symterra said it isn’t unusual for project teams to compress the construction programme of the later activities.
“Items can include M&E fit-out, systems testing, from fire to security as well as time for snagging and ultimately testing and commissioning,” he said. “They can typically have reduced timescales. Sometimes this works out fine in the end, but when you have any issues they will impact the project’s critical path.”
2024 cannot also be given an overview without mentioning the demise of ISG. As Build in Digital wrote in September, the collapse of the contractor had significant knock-on effects on contracts and sub-contractors. Public sector work accounted for a third of ISG’s pipeline when the contractor filed for administration in September, with the loss of 2,000 jobs.
Contracts affected by the collapse included the Fujifilm Diosynth Biotechnologies Facility in Billingham, North East of England, worth £200m, the Slough Data Centre Campus in Berkshire, worth £200m, the Institute of Neurology for UCL in London, worth £158m, the Data Centre for Vantage Data Centers in Ealing, London, worth £150m and a further data centre project, the Colt Data Center Services in Hillingdon, London, worth £150m. Those projects alone totalled over £650m.
In terms of infrastructure, energy regulator Ofgem approved plans for a £3.4bn overhaul of the electricity network that will see an energy ‘superhighway’ built between England and Scotland. A 270-mile subsea and underground cable will transmit renewable energy from Peterhead in Aberdeenshire to Drax in North Yorkshire, with a capacity to power up to two million homes.
Infrastructure has also become a focus for government overhaul in the latter half of 2024. Labour plans to expedite planning decisions on at least 150 major infrastructure projects over the next five years.
The initiative aims to accelerate the delivery of critical projects such as gigafactories, solar farms, roads, and railway lines, contributing to economic growth and development. Energy secretary Ed Milliband got to start quickly, approving a swathe of solar projects shortly after the general election. More approvals for schemes, from roads and rail to energy are expected in 2025.
Setting standards with net zero
The Autumn saw the publication of a new net zero carbon building standard. As an industry-led initiative the free-to-access technical standard that will enable the built environment to robustly prove that built assets align with the UK’s carbon and energy budgets.
Led by the chair of developer Related Argent, David Partridge, a swathe of industry experts has also contributed to ensure the new standards are robust, and deliver on the promise to drive down carbon emissions.
Organisations including BBP, BRE, the Carbon Trust, CIBSE, IStructE, LETI, RIBA, RICS, and UKGBC have joined forces to champion the initiative.
The standard is in a trial period and it is unknown how successful it will be, however it is at least a step in the right direction. The impact on future building designs is also up for debate.
Just as the industry was setting new standards for reducing embodied carbon, retailer Marks & Spencer was embroiled in its own carbon conundrum. The retailer had sought permission to demolish its art deco store on Oxford Street to then rebuild, adding extra space and in theory modernising and saving on the future operational carbon of the department store.
The demolition was opposed, however, by a number of campaign groups who had the sympathetic ear of Michael Gove, former communities secretary who called in the scheme, finally refusing permission.
That decision by Gove was quashed in the High Court. A subsequent application was approved by deputy PM Angela Rayner just before the Christmas break.
What both stories point to is an industry grappling with how to count the cost of carbon, and the impact on both planning, demolition and perception of a sector which according to some estimates accounts for 40% of global carbon emissions.
Housing: Delivering on demand?
The last 12 months saw consolidation in the housing sector with mammoth housebuilder Barratt signing an agreement to buy rival Redrow, in a £2.5bn deal which was finalised in October.
When it comes to construction, Labour’s major focus is undoubtedly on housing. The target of 1.5m homes was upgraded by deputy prime minister Angela Rayner shortly after Labour came to power.
“We are approaching the end of a year in which substantial change in planning and development has been pledged and promised,” says Nick Diment, director at Boyer. “But the publication of the revised NPPF … is the first actual change, in the form of new government guidance, with potentially far reaching and long-term consequences.”
Ironically, the new Labour government has increased uncertainty in the planning system with its new proposals – at least for now.
The future for the housing sector overall should be bright however, as the government focus on delivery will at the very least shift the dial in terms of planning decisions between now and 2029.
After a rollercoaster ride in 2024, here’s to what looks to be an even more eventful 2025.
Image credit: Stock for you – Shutterstock
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