July 2021 Vol. 76 No. 7
Features
Growing Pains and Gains
By Cathy Schmermund, Contributing Editor
The “wild ride” of the 1990s was tame compared to what the underground construction industry experienced during the 2000s.
As the new millennium began, the economy was robust and workloads were heavy in virtually every area of underground utility construction, especially telecommunications, where there seemed to be “no end in sight.”
But it didn’t last long. In the third quarter of 2000, telecommunications construction suddenly slowed down, then totally collapsed in the first quarter of 2001, as the country entered a recession. The sinking stock market and economic slowdown infected all other segments of the underground construction market.
While activity dropped dramatically in telecom, energy and public works, it didn’t stop altogether. Both the high-profile, long-haul Level 3 Communications network and the massive Alliance natural gas pipeline, for example, were completed in late 2000.
In 2002, agencies in the San Francisco Bay area geared up for 12-year $3.6-billion overhaul of its water system. The recession officially ended eight months later, in November, but it was another two years before the industry fully recovered.
New market dynamics, complexity
To be well-positioned for better conditions, the industry had to understand and adapt to changes.
Telecommunications, energy pipelines and sewer/water construction needs were becoming more complex. They required both focus on cost-effective and efficient solutions, and on expanding their services beyond a single segment, technology or approach.
For construction companies that were efficient and flexible, there were many opportunities to diversify. With the crash of the telecoms industry, contractors actively looked at other markets and applications to keep their directional drilling equipment busy, such as water line construction.
Technology continuously pushed the boundaries, while finding solutions to underground infrastructure problems, such as the latest equipment and methods to boost productivity, and new applications and markets for existing equipment.
Early in the 2000s, compact models were introduced with more power and flexibility in tight and congested areas, such as an HDD rig targeting mid-long range utility installations and featuring a small footprint with a new rack-and-pinion drive.
Innovative utility mapping and condition-assessment software, using GPS technology, assisted a city with improving the maintenance program of its water and wastewater collection and conveyance infrastructure.
Another trend was increased emphasis on damage prevention and safety. Vacuum excavating became an essential damage prevention tool that performed potholing.
The first classes of NASSCO Pipeline Assessment Certification Program (PACP) were conducted in 2002. They introduced new standards for inspecting and assessing the condition of the nation’s sanitary sewer pipelines.
Comeback
In 2004, the economic rebound seemed to be serious and sustained, bringing fundamental change to the underground construction industry.
Energy pipeline construction projects were on more solid financial footing, with a higher probability of actually being built and a rapid rise in energy prices. The electric segment was wading through deregulation and beginning to grow.
Public works (sewer & water) projects were actually letting bids and providing large amounts of work. HDD continued to diversify and adapt.
Technology advancements and refinements included:
- Unique robotic cutter, powered by high-pressure water rather than a traditional pneumatic tool, was more powerful and able to cut more effectively than conventional equipment.
- Fully hydraulic bucket trencher was the first significant design change since the original model. Contractors using it reported “impressive production figures without the maintenance issues inherent in mechanical bucket machines. There was no shocking and jarring of the machine during trenching, no stress fracturing, and the flywheel absorbed all shock loads.”
- Installation of a 60-foot tunnel underneath a rail line, to facilitate a new bike path, ranked as the largest-diameter pipe ram completed to-date.
In 2005, recovery from the recession was in full swing. Telecom emerged smarter and continued to mature as diversified digital companies. Fiber-to-the-premises (FTTP) projects dramatically increased their activity level. Comcast, the nation’s largest cable company, announced entry into the national telephone market, becoming the biggest single competitive threat to the regional Bell operating companies.
Manassas, Va., a Washington, D.C., suburb, was the first U.S. city to make broadband over power lines (BPL) technology available on a city-wide basis. Customers were connected to broadband through any electrical cable outlet with a BPL modem; an ethernet cable connected the modem to a computer, router or other device.
2006 was a very strong year for underground infrastructure. It was also a changed world; the difference between telcos and cable companies was disappearing and “digital media” companies emerged.
Reflecting the prominence of the internet in our culture, eBay started including underground utility construction equipment.
However, 2007 was a bit of an enigma. Some aspects of the underground construction and rehabilitation market had cooled slightly from their torrid 2006 pace, but most niches remained quite healthy.
A striking trend in the public works sector was a huge jump in water rehabilitation with $1.2 billion in projected work.
Also in 2007, the 811 nationwide number for contractors and others to call and request locates for buried pipe and cables was fully implemented. Part of the Common Ground Alliance “Call before you dig” branding program, the 811 awareness effort has been credited with being even more successful than most had dreamed possible.
Congress created the Pipeline and Hazardous Materials Safety Administration (PHMSA) and Research and Innovative Technologies Administration to replace the eliminated Research and Special Programs Administration (RSPA).
Recession redux
Starting in 2008, the world’s economy began to slip again and by the end of 2009, completely tanked, dragging some of the underground construction work to a standstill.
Known as the “Great Recession,” it was even more drawn out than the earlier recession. However, it didn’t have a widespread impact on the entire industry. Hardest hit was municipal sewer and water plans, which struggled with severe budget shortfalls until relief finally came in 2015 – five years after the recession was declared ended.
Some industry segments prospered, largely due to the diversification and flexibility lessons learned from the early 2000s recession.
A bright spot was rehabilitation market, which maintained at least some growth throughout the recession. Even more, its steady evolution over the past 30 years, from a few, primary technologies to a plethora of affordable options, played a critical role in keeping underground infrastructure operating at maximum efficiency.
During the Great Recession, those options have been life savers for many municipalities and utilities battling tight budgets, consent decrees, public health concerns, ruptured
pipe emergencies and more.
Another “silver lining” was HDD. Through all the market changes, HDD has survived and prospered, leaving an
indelible impact on every aspect of the construction market – big applications and small.
This diversification has played a key role for many success stories. Tooling and equipment also continue to be refined. Barriers to construction crumbles and in many instances,
jobs previously thought impossible by virtually any technology, are now being designed for HDD.
Water applications and gas distribution continued to be huge market applications for directional drilling.
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