Insight by Guidehouse

Add data analytics to infrastructure dollars to enhance resilience

Landmark legislation has given government and industry grantees and contractors an unprecedented opportunity to build resilience. However, money alone won’t f...

Landmark legislation in the form of the Inflation Reduction Act and the Bipartisan Infrastructure Act have given government and industry grantees and contractors an unprecedented opportunity to build resilience. According to consultants at Guidehouse, the funding has the potential to improve resilience not just of physical infrastructure but also of social and economic structures and of the environment.

Much of the money and effort will be expended on historically underprivileged and underserved communities, noted Guidehouse partner Gaurav Menon. He added that the federal dollars will have an amplifying effect on these critical issues.

“A lot of the funds going through are not only going to be coming from taxpayers, but are going to require that the grantees who are receiving these funds to actually infuse private sector funding to use it as a force multiplier,” Menon said.

“At the end of the day, the federal government wants to see impact,” Menon said. “How can we take a trillion dollars, use it as a force multiplier to get the private sector to actually make that $3 trillion of investment into the new green economy and an environmentally friendly economy?”

Money alone won’t fix the problems. In fact, there’s a crucial technology component, said Guidehouse partner Eli Goberstein.

“A lot of it has to do with data and more specifically, big data,” Goberstein said. “The art and the science around that is, how do you take these complex, large and disparate datasets and leverage leading-edge technologies to operationalize the data? He said an important analytic skill consists of combining the relevant data from differing domains such as climate, census and infrastructure.

Compare and contrast

Menon described a couple of client projects using the combined data analytics approach to getting the most out of resilience spending.

“We’re looking at their physical assets,” Menon said. “And then we’re doing analysis against natural threats depending on the region they’re in, whether it’s tornadoes, wildfires, whatever it is, to come up with a scenario based on analysis using data technology to do predictive analytics.” An organization can use the resulting insight to improve the resilience embodied in its short- and long-term capital investment plans.

“You have a much more sustained, strategic way of looking at your assets,” he said.

Government can also enhance its infrastructure analytics capabilities with the addition of environmental sensors, in the internet-of-things model, Goberstein said. Sensors attached to railroads or bridges, for instance, can give evidence of the need for maintenance before a failure occurs.

“You can really focus on identifying pain points, or areas where resilience needs to be bolstered by your supply chain, for example,” Goberstein said. Predictive analytics, he says, can therefore also identify weaknesses and shortfalls in the supply chain itself, he added.

With the availability of low-code platforms and low power and data intensive sensors, even rural areas without urban-levels of broadband or technical expertise can use the IoT strategy, Goberstein said.

Governance required

Given how many entities often overlap on a given infrastructure area — including state, country and local government; independent authorities; and the private sector — federal oversight and effective use of money requires careful governance and accountability structures.

“I think the big question for the federal government and for the agencies that are going to be doling these funds out to state and local entities and commercial entities will be how do you design a new program looking at the federal regulations,” Menon said. “Also, what it means to be compliant, while at the same time giving enough flexibility to the recipients of these grants to be actually able to innovate and not be constrained by the regulatory environment.”

He pointed out that within the fine print of the Infrastructure and Inflation Reduction laws, you can find incentives for all the players, such as tax rebates for commercial entities.

They’re “structured specifically to make sure that they’re accountable, that they’re providing value to the disadvantaged communities,” Menon said.

This implies that grantees and contractors can’t take cookie-cutter approaches to aiding resiliency. An area traversed by rivers threatening to flood has different requirements than an area crisscrossed by rickety rail lines carrying chemical-bearing trains.

Goberstein suggested setting aside dollars to ensure projects have the right information technology “like machine learning algorithms that can be built to tailor programs to these communities.” Such algorithms would also help communities shape their proposals.

He added that technology applies also to testing and modeling of  infrastructure projects.

“It could be something relatively new, like a digital twin for an entire city, which allows you to test and provide a city planner with an ability to go into a model and see how a certain program or a certain policy will impact that city before actually implementing it,” Goberstein said.

“And then,” he said, “in a crisis environment, you can use things like large language models to scrape social media, news reports and emergency alerts, and take that data, summarize it, aggregate it and synthesize it in a way that’s usable by the individual or by the agency supporting those individuals.”

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