Quake could cost $16 billion
A magnitude-7.5 earthquake along the Wellington Fault would cause years of disruption and cost $16.7 billion, a report out today says. Damian George reports.
Wellington’s infrastructure needs a $5 billion upgrade to avoid crippling New Zealand’s economy following a major earthquake, new research shows.
A report by the Wellington Lifelines Group estimates the country’s gross domestic product would take a $16.7b hit following a magnitude-7.5 earthquake on the Wellington Fault – unless a co-ordinated, 20-year infrastructure programme was adopted.
The group has called on its 16 member organisations to help deliver 25 key infrastructure projects across the region over the next two decades, at a cost of $5.3b.
Doing so would save the country more than $6.1b in lost economic activity in the five years following a major earthquake, although it would still take a $10.5b hit, the report says.
Lifelines Group chairwoman Dame Fran Wilde said it was the first time a collective economic value had been placed on the region’s proposed resilience projects, some of which were already under way.
The recommended programme, which the group wants to be formally adopted by early next year, would include projects across the fuel, transport, electricity, telecommunications, water, and gas sectors.
It would be rolled out in three phases, with the first seven-year phase to focus on fuel, road and electricity projects.
Those projects were deemed to offer the greatest resilience value to the region, because many other initiatives – such as water network upgrades – were dependent on the others being built first.
Wilde said apart from the $800 million saving to the country’s GDP (once the implementation cost was taken into account), the programme would also safeguard the region against smaller, more frequent natural events, and increase general confidence in the area’s economic stability.
That was especially important given Wellington city had a high number of professional services that were highly mobile and could easily relocate.
But much of the programme remained unfunded, and would need to be bolstered by the group’s member organisations. They include a mix of local councils, government organisations, and private companies.
In total, the programme was almost $3.4b short, with the second phase (from years eight to 14) requiring more than $2b of additional funding.
Of the $1.9b theoretically committed by the various organisations, more than $1.5b was contingent on funding from long-term plans being allocated.
Wilde said the timing of the programme was critical, and would require a re-think of investment plans from elected representatives, company leaders, and senior managers.
‘‘This is a challenge for everyone. It may cost consumers more over time, so the question that Wellingtonians and their leaders need to consider is whether it is worthwhile ensuring that there is a viable economy and jobs following a large earthquake.
‘‘These are big numbers but . . . the study demonstrates that, as a community, we have options and don’t need to just sit back and wait for what mother nature throws at us.’’
CentrePort is no stranger to quake damage. Wharf strengthening is among 25 proposed key projects across the Wellington region over the next 20 years.