Image: Pipeline & Civil Project Engineer Darsh Shah inspecting a concrete-lined steel pipe.
The current fuel crisis, however long it lasts, should force a rethink on how we select and procure infrastructure materials, says Hugh Goddard from Pipeline & Civil.
Escalated fuel costs this quarter have often been discussed as a transport issue. For the infrastructure sector, it is much broader. It is a reminder that the economics of construction can change quickly, and that the way we select materials, design projects and procure work needs to be more flexible than it has traditionally been.
Fuel sits behind almost everything we do. It affects earthworks, haulage, quarry production, manufacturing, material transport and site operations. When fuel prices move sharply, the impact does not show up neatly in one line of a project budget. It spreads through the entire supply chain.
Recent data highlights just how material this shift has been. Stats NZ reported that, as of March 2026, diesel prices had risen by 42.6 percent. That means the discussion needs to move beyond simply asking who carries the cost increase. The more important question is whether we are still building the right solution, with the right materials, in the right way, for the conditions we are operating in now.
The pipe discussion
Pipes are a good starting point – but this is a wider issue. Pipe materials are often locked in early at design stage. Selections are made based on technical performance, standards, whole-of-life expectations, installation methods, availability at the time and historical preference. All of these are valid considerations.
The challenge is that the assumptions behind those decisions can change.
This is particularly evident for polyethylene (PE) pipes. PE prices have increased significantly, driven by higher global resin supply costs and increased energy and fuel inputs into resin production, manufacturing and transport. When combined with sharp diesel price increases, those upstream pressures can materially change the delivered cost and availability of PE products compared with what was assumed at design stage.
That does not make PE a poor choice. PE remains a proven and high-performing material in many applications. However, it does reinforce the need to reassess assumptions when market conditions shift.
A pipe material that looked like the best value option twelve months ago may now face longer lead times, higher freight exposure, or greater delivery risk. Conversely, an alternative material or installation method may now be more readily available, faster to install, easier to transport, or lower risk once the total installed cost is properly assessed.
While pipes are an obvious example, the same question applies more broadly across infrastructure. Precast concrete, aggregates, steel, fittings, valves, imported mechanical equipment, pavement materials and treatment plant components are all exposed to fuel and energy inputs. Any material with high transport intensity, imported supply chains or long manufacturing lead times deserves a second look.
The question should not be, “What did the original design specify?” It should be, “Given current market conditions, what is the most compliant and buildable solution available now?”
We need earlier, more honest conversations
In a difficult market, there is a real risk that everyone retreats into their contractual corner. Contractors price in risk. Clients resist change. Designers stick with what has already been approved. Suppliers protect their positions. The outcome is slower delivery, higher costs and more friction with potential conflicts arising as a result.
That helps no one.
Where material costs, availability or lead times have genuinely changed, contractors should be encouraged to raise that early. Clients should be open to understanding the implications. Designers need to be supported to reassess options quickly. Suppliers should be part of the conversation, because they often have the best real-time insight into capacity constraints, lead times and substitution options.
This is not about giving contractors a free pass. It is about practical, evidence-based conversations that keep projects moving.
Procurement should enable solutions, not lock them out
Traditional procurement models can make this harder than it needs to be. Highly prescriptive specifications with limited scope for alternatives often leave contractors with only one realistic option: price the risk and hope it does not materialise.
A more resilient approach is to focus on performance outcomes rather than specific products. Clients can specify the required hydraulic performance, durability, pressure ratings, installation constraints, quality assurance and design life, while allowing the market to propose the most suitable compliant solution.
For pipe projects, that may mean reconsidering material selection, jointing systems, local stock availability, trenchless versus open cut installation, or staging aligned with realistic supply. For other projects, it may involve reassessing pavement design, modular construction, local manufacturing options, or construction methodologies that reduce haulage and plant intensity.
This approach encourages innovation without compromising asset quality.
The real cost is not just the supply rate. Material decisions are still too often judged on unit rates alone. In the current environment, that is a mistake.
Fuel price increases of this magnitude, particularly for diesel, amplify the impact of material price movements such as PE resin costs and freight. A slightly higher supply cost can be offset by better availability, quicker installation, reduced transport, or lower programme risk.
Lead times matter. Availability matters. Programming certainty matters.
If a critical pipe, fitting or valve is delayed by months, the knock-on effects can include extended traffic management, idle crews, remobilisation, temporary works, redesign and disruption to communities and clients. Those costs are real, and they should form part of material selection decisions.
Total installed cost and delivery risk need more weight than they often receive.
Practical reset point for live projects
For projects already underway, clients should consider whether there is a practical opportunity to pause and reassess key materials against current market conditions.
That does not need to be complex. A simple review could ask: Are the specified materials still available within the programme? Have lead times or freight assumptions materially changed?
Are there compliant alternatives that reduce cost, delay or delivery risk? And, what approvals are required, and can they be made quickly enough to protect delivery?
Timeliness is critical. Being theoretically open to alternatives is not enough if approvals take so long that the opportunity passes.
The opportunity
The lesson for future projects is clear. Procurement models need to acknowledge uncertainty as a normal condition, not an exception.
That may mean allowing alternative tender submissions, early contractor involvement, clearer material review gateways, performance-based specifications and more transparent risk- sharing mechanisms. Contract provisions matter, but they should be a backstop rather than the primary strategy. The best outcomes will come from collaboration before issues become claims.
The fuel crisis has been uncomfortable, but it also creates an opportunity.
It forces the sector to think harder about resilience, constructability, local supply, and design flexibility. It challenges the assumption that the material selected at design stage will always remain the best answer at construction stage. It encourages clients, designers, contractors and suppliers to operate as a project team rather than as separate parties protecting separate positions.
For pipes, that means being open to alternative compliant materials and installation methods where they make sense.
For the wider infrastructure sector, it means recognising that material selection is no longer just an engineering decision, it has significant commercial consequences.
If we want to keep infrastructure projects moving, we need to create space for the market to respond. That requires confidence from clients, agility from designers and a willingness from contractors and suppliers to put practical solutions on the table early, either at a project level or an overall client level where standard specifications dictate the direction of travel.
The projects that succeed in this environment will be the ones where people are prepared to think differently before the problem becomes unavoidable.
Handing over the baton