TITUS Infrastructure Services Limited
#215 – 737 GOLDSTREAM AVE
VICTORIA, BC, V9B 2X4
TEL. 250 727-8355
Making Renewable Utilities Profitable
OLD WAVE
Onsite built, one-off utility projects require a significant amount of specialized knowledge,
including site specific and technology specific requirements that feed into detailed engineering
before a single shovel hits the ground. Until construction starts, budgets can be extremely
variable, and if challenges occur on site during construction change orders can drive up the cost
and drive outcomes away from what your stakeholders and the public at large was expecting.
That was then…
NEXT WAVE
Modular deployments generate results quickly and avoid large up front capital costs, which
would otherwise distract or derail projects, therefore modular by its very nature creates
numerous benefits to enabling cities to build Climate Smart Cities!
This article explores the rise and benefits of modular infrastructure. Having said that, let me
define Climate Smart Cities:
CLIMATE SMART CITIES
Cities that can actively combat the negative effects of climate
change and help improve the climate in a measurable
and timely manner.
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ABOUT THE AUTHOR
I have been actively involved in modular infrastructure and modular manufacturing for the last
20 years and have seen it rise from a temporary structure to where modular is becoming core to
making manufacturing ever more competitive enabling urban revitalization that helps cities
combatting climate change and become Climate Smart Cities.
Over that time, people have asked me what got me so excited about modular and I would have to
say that happened when I saw first-hand how modular could massively reduce costs, increase
quality and reduce delivery time. I was working for a custom bus company at the time, and they
were so very proud that they delivered buses that met the unique requirements of their customers.
They were also convinced that to do that meant starting from the ground up. Perhaps the genesis
of what makes modular revolutionary is that the bus company would give precedence to higher
value clients, meaning buses would be pulled off the production line, while the line was
restructured for the higher value customer.
So being young and somewhat naïve to the whole bus building industry, I asked one a couple of
VP’s why they didn’t build a modular bus. They all told me the same thing, because we sell
custom buses to meet the unique needs of our customers. So in a moment of inspiration, I met
with each of the VP’s and asked them to play along and imagine if they could build a modular
bus that met every one of their customers’ expectations, what would that mean to them and the
company. For example, a custom bus, including variable chair configurations, lighting
assemblies, deck heights, etc. So eventually they all agreed to play along.
Perhaps the most important question I asked them was what does it cost to change the production
line from one bus run to another customer bus run? The answer I got floored me, “Production
line changes cost $3-5million.” To the next question, how many times per year do you change
the production line, to hear, “10-12”. To which I exclaimed, “You spend 30-60 million per
year?” Then to hear, “No Mr. Lindquist, we have to change both our Canadian and US
production lines, because we build half the bus in Canada and half the bus in the US.
I said, “Do you think for $120 million dollars you can build a modular bus that meets your
customer’s unique requirements.” To which I was asked to address the board, by each of the
VP’s I met with.
After that, I have always wondered if there was anything a modular approach could not solve.
SETTING THE STAGE
With that backdrop, some may find the following a very disruptive concept in municipal
infrastructure while many others may find it very energizing and full of opportunity. No matter
which camp you may fall into the Rise of Modular Infrastructure attempts to give you a
framework and a set of tools to help you help our communities become climate smart.
The Rise of Modular Infrastructure discusses modular infrastructure as a new urban reality and
essential to building climate smart cities that are able to combat climate change cost effectively
and on a timely basis.
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The purpose of writing this is to engage you, and get you engaged in the dialogue in your
communities, so that you can be a better leader in the social, environmental, and economic health
of your communities. Or perhaps more importantly, give you some tools that can help you help
your community actually combat climate change, in a timely and cost effective manner.
So throughout the article, I am going to ask you questions about what is important, or how this
topic is important to you and to your communities.
THE KEY TO CLIMATE SMART CITIES
As an engineer, I often wonder how many big infrastructure projects there would be if WE as
engineers and municipal leaders had to actually write the checks and be accountable for any cost
over runs ourselves. That means, WE actually put our house on the line and not just the fate of
the taxpayer. My guess is WE would ALL find much more innovative and cost effective ways to
accomplish the very same thing.
It has been my experience that when people actually have to write the checks, like those VP’s
who were accountable to their shareholders, you gain a personal appreciation of the importance
of innovative approaches and the value modular infrastructure very quickly.
Don’t believe me? How many big projects would you be working on right now if you had to
write the check and cover the overages? Or would you find more innovative and cost effective
ways to accomplish the same thing?
Don’t know how – keep reading!
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1. UNDERSTANDING BENEFITS OF MODULAR SYSTEMS
Before we get caught up in
infrastructure and
infrastructure questions, I want
to get you focused on WHAT
is important and WHY, and
YES I want you to be engaged,
and I would like to get that
going right away by asking a
very important question.
QUESTION 1: What’s an
early 1900’s Model T got to do
with urban infrastructure?
No seriously?!?
Ok let me help you
What benefits did Henry Ford bring to the auto industry?
How about:
Standard components?
Standard maintenance?
Improved quality?
Lower costs?
Greater availability?
Less Variability
What about “Reduced Skill Set”, because components are standardized with standard
maintenance requirements the automobile became much simpler to assemble and maintain.
What Other Benefits?
Ok, while you are thinking about that….
Did you know that up until Henry Ford a chauffeur was required to pilot a vehicle and that a
chauffeur had to be part:
Craftsman: able to craft the specialty parts
Scientist: with knowledge of internal combustion, steam or electric motors
Engineer: and mechanic to make things work and keep them working
Other Specialties: And many other areas of specialized knowledge
Question 2: Does that sound like municipal infrastructure in your community?
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Last chance, any other ideas on what Henry Ford brought to the table?
The relevance of Henry Ford to urban infrastructure really comes down to the following:
Why Is Infrastructure Still Hand Crafted, Highly Variable,
Requiring Expensive Highly Skilled Designers & Operators?
While I have you thinking about the relevance of Henry Ford’s Model T to infrastructure, let me
put forward two critical premises:
PREMISE ONE: When you go modular, you have a great opportunity to maximize the
value of your highly skilled labour force, by getting them focused on what they do best,
just like Henry Ford did, with the whole supply chain from the raw materials to the
service stations.
PREMISE TWO: Modular deployments generate results quickly and avoid large up
front capital costs, which would otherwise distract or derail projects, therefore modular
by its very nature creates numerous benefits to enabling cities to build Climate Smart
Cities!
Having said that, let me define Climate Smart Cities:
CLIMATE SMART CITIES
Cities that can actively combat the negative effects of climate
change and help improve the climate in a measurable
and timely manner.
2. CAUSE AND EFFECT OF MODULAR INFRASTRUCTURE
If you remember nothing else from this article, remember, most importantly:
Modular Infrastructure Generates Results!
For example, because modular infrastructure is manufactured, equipment is standardized with
standard maintenance requirements, the assembly and maintenance of infrastructure is equally
less complex, simplifying the deployment and maintenance requirements, which in turn reduces
the risk to the owner, municipality and taxpayer.
Or alternatively, because modules are standardized, they can be manufactured all over the world,
improving the quality and availability and reducing the deployment time.
Perhaps the greatest benefit of modular technologies that has been demonstrated in the auto
industry, and many other industries; modular enables Just-in-Time delivery, which reduces
carrying costs, reduces risk, while allowing for new technologies to be plugged in. For industry,
the latter means greater competitiveness, for municipalities, it means they can be more resilient
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to change and more progressive (competitive) when it comes to the social, environmental and
economic needs of their communities.
MODULAR INFRASTRUCTURE GENREATES RESULTS
Reduce Complexities
▼
Simplifying Deployment and Maintenance
▼
Reducing Risk to Municipalities & Taxpayers
▼
Improving Quality of Results
▼
Improving Return on Investment
Modules Can be Manufactured Globally
▼
Improving Quality & Availability
▼
Reducing Deployment Time
▼
Enabling Just-in-Time Delivery
▼
Reducing Time to Getting Results
ENABLE CLIMATE SMART CITIES
QUESTION 3: Any other cause and effects related to modular infrastructure?
QUESTION 4: Are there any negative cause and effects of Modular Infrastructure?
A DEEPER LOOK AT THE BENEFITS OF MODULAR
The following is a list of benefits, which I have been compiling over the last few months, and
trying to establish the top 10 benefits.
What we have been finding, although numerous, the benefits of modular depend on your context.
Feel free to rank them yourself, or Click Here
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QUESTION 5: Can anyone give me their top 2 or 3 from the list or even better from their own
experience?
QUESTION 6: Can anyone give me 2 or 3 things that could not be done with modular
technologies?
Let me help you out, one answer, used to be, “We are a custom bus builder and if we build
modular we will lose our competitive advantage…” until I showed tem how modular could save
them $120 million per year, reduce time, and make customizations easier.
REDUCE COST & RISK FOR INNOVATORS & COMMUNITIES
One of my favorite stories comes from a group that was trying to get their modular, agricultural
biomass pyrolysis system to market. They had a pilot ready system for the last 10 years, but they
were always shooting for a 200 tonne facility, and never entered the market. Yet, farmers across
North America need a way to dispose of their chaff and dead livestock. I told them my favourite
two words from innovators, is I have a pilot ready technology, because quite often it is the
perfect size for a modular, scalable, cash flow deployment.
One of my favourite communities for demonstrating the benefits of modular is Manhattan.
Manhattan has been solving problems with modular systems for 20 years.
For example, although Manhattan does not have a drought they have been working on putting
water reclamation plants and energy recovery systems in the basement of buildings to reduce the
water supply requirements and equally importantly the downstream load on centralized treatment
plants.
What we have discovered with our partners is the optimum deployment seems to be on a 2-4
block square. This also allows for ease of reuse of energy and water, while having a meaningful
impact on the upstream and downstream utility infrastructure.
1. Reduce Water Supply Requirements
Recover and reuse water within one or more buildings
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2. Reduce Downstream Loading
Reduce the burden on downstream centralized plants
3. Reuse Energy and Water Within the Community
Related to #1 – optimal deployment seems to be 2-4block square
From a logistics standpoint the benefit of modules is implicit, modules can be built offsite in one
or more manufacturing facilities and shipped to site as required, improving quality and speed of
deployment, while reducing costs and disruptions within the community.
One of our partners, has also recently got approval to put modular water reclamation plants into
existing buildings and tap into the building fire suppression systems to deliver reclaimed water to
the different floors, by tapping off the fire suppression systems with pressure isolation valves and
flexible purple PEX to deliver reclaimed water to toilets and washing machines on the different
floors.
Another consideration that was recently brought to my attention by a
very senior UK architect as we have been evaluating a number of
projects across the UK is the discussion around modular as
temporary infrastructure or modular as permanent infrastructure.
However, what has been proving out time and time again, and
gaining momentum across Europe is modular infrastructure as
permanent structures, like the building above, because buildings can
be built quicker, with higher quality, at less cost than conventional.
The above building was delivered more than a year ahead of
schedule when compared to conventional vertical construction,
providing the owner with an additional year of rent, as this building
is part of Victoria Hall a dormitory for one of the London
Universities.
25 Story Modular Highrise
Built in 27 Weeks
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3. MAKING RECOVERY AND REUSE PAY FOR ITSELF
One very exciting thing that I have found over the last ten years is the more you modularize the
more you can give what used to be a waste product a purposes.
AND BY DOING THAT
You can turn a cost centre
into a revenue centre,
because waste costs money.
When you see it this way it
is easy to see infrastructure
as LEGO
We can build what we need,
where we need it, at the size
we need it to be at that
moment in time. Space
efficient, cost efficient and
time efficient. Each module
can be built off site and
dropped into place where
and when we need it.
Further, what I have found over the last 10 years is the more you integrate modular renewable
utility components together and the waste from one component becomes the resource for anther
the more competitive you can be with conventional utility rates for their consumers.
Perhaps the simplest and most overlooked resource within a community is the effluent from a
waste water treatment plant, and as a result we throw it away. The excuses are always, the plant
is too far from the city and its too expensive to get the water back into the community, so it is
thrown into a lake, river or ocean. Yet, communities all over the world continue to spend 100’s
of millions of dollars on treatment facilities, only to throw out the product.
What industry would do that? Can you imagine Ford or GM building a billion dollar facility to
have the new Ford Focus or GMC Denali roll off the end of the production line directly into a
land fill?
Yet that is what we do time and time again in municipal infrastructure.
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MAKING YOUR COMMUNITIES CLIMATE SMART
One of the beautiful things about a modular approach is you can pretty much start with any need
in a community, and if done properly incrementally move towards a net zero energy, water and
waste community that can pay for itself.
All you need to do is build a Resource Matrix, like the one below, to turn waste into a resource
and start generating cash flow to pay down the costs of the infrastructure.
As I mentioned earlier, we have found the more you modularize the more you can turn a waste
into a resource. Together, this minimizes the capital and operating costs of the utility and its
utility rates, and turns cost centres into revenue centres which maximizes the return to the utility
or municipality you are working with.
This above image may look complicated, however, it comes down to two simple business
principle.
1. Waste costs money.
2. Waste is merely a resource without a purpose.
The secret, is once you give waste a purpose, you create value and reduce cost. These two
drivers are what enables renewable utilities to be profitable.
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A third business principle is to build a sustainable profitable renewable utility, you need to match
your capital and operating costs with the revenues.
3. Match Capital and Operating Costs to Revenues
This can be done by making every step in the process modular, and by deploying modules in a
just in time process, as the capacity is required, very similar to just-in-time parts supply for
Ford or GM to reduce their warehousing and logistics costs and allows them to release new
models and new features much quicker and more competitively than ever before.
What gets really exciting is when you realize that you can modularize every component of the
infrastructure down to the size of a shipping container (gray boxes or Lego pieces above). This
helps reduce the supply requirements and enables the right sizing of the just-in-time capability of
modular systems, allowing you to provide what is required, when it is required, minimizing the
capital and operating costs of the utility and its utility rates, while maximizing the profit to the
utility and your community.
Don’t believe me, here are just a few examples:
Once you have built your Resource Matrix and work your way through it you come out the
other side with usable commodities some with very high value.
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CONCLUSION
When it comes down to it, just think of Lego.
We can build what we need, where we need it, at the size we need it to be at that moment in
time. If a better mousetrap is developed, we can replace it and put the new one in.
Space efficient, cost efficient and time efficient. Each module can be built off site and dropped
into place where and when we need it.
To help you help your communities improve
their environmental, social and economic
health here are five quick steps for becoming
Climate Smart:
1. Start Small Start Modular
2. Control Critical Success Factors
3. Avoid High First Cost and anything that
distracts from maximizing the value of your
project
4. Manage Incremental, Sustainable Growth
5. Repeat what works, improve what can be
improved and drop what doesn’t.
One of my friends was a gold medal athlete in the 2012 Olympics in the 8 man skulls. He said
that is very similar to his regime.
This is the same regiment a professional athlete takes to their training regimen. They
didn’t wake up one morning and run the Iron Man, probably the best comparison to a city
contemplating a massive central treatment plant or power plant. They started small, they
controlled what was critical to their success, they avoided issues that would distract them
from their goal, they worked on incrementally growing their ability and managing their
success factors. And they repeated what worked and dropped what didn’t to further
improve their results.
You are also correct if you said it looks like the basis of a continuous improvement approach.
My challenge to you is make the above your regime. Or if you are contemplating something
else, consider what you would do if you had to write the checks and carry any over runs….
If you do that, I believe we will all be able to help our communities become climate smart.
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Future Proofing Your Community
TITUS makes it simple, fast and cost effective to
make your communities Climate Smart.
TITUS has found that the more you modularize
infrastructure the more you are able to repurpose and
reuse resources that were otherwise wasted turning
cost centres into revenue centres.
By recovering, repurposing and reselling resources
that were otherwise wasted within a community.
TITUS substantially reduces the amount of energy,
water and other resources that a community needs to
supply.
Let us help you put together a solution to help your community become Climate Smart - Today!
Let us help you get started today!
For more information contact:
Email: [email protected]
Twitter: @TITUSrenewables
Web: www.TITUSinfrastructure.com
Make Your City/Development Climate Smart!
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Additional Reading
Building Modular Clean Energy and Water Systems
Building Modular District Energy Sharing Systems - Integrating energy and water
reclamation
Building Modular Gasification Systems - Start small and build to meet your needs.
Transforming how Renewable Infrastructure is Built - A new way to fund
infrastructure.
Building Renewable Infrastructure
Building World Class Sustainable Cities - Building sustainable cities is easier than you
think.
Chapter 1: Getting Things Done – Know where you are going and why
Chapter 2: Do Your Homework – Gets you 96% of the way to a successful project
Chapter 3: Know Where to Start – Once your homework is done – then what?
Chapter 4: Keeping Things Small Enough – The key to Getting Things Done!