Developer-builder <a href="https://www.apartments.com.au/developers/dasco-australia">DASCO</a> has pushed beyond the now-standard inclusions of rooftop pools and landscaped podiums at its recently launched new Epping project, Senso.

It has laid out over 4,000 sqm of resident-only amenity in a move designed to compete directly with low-density housing on livability, not just density. The result is a development that supports genuine daily use through purposeful spaces distributed across its five-building, 479-apartment precinct.

[smartcode_project:default project_id=134954 project_image_fid=4396]

Two rooftop pools form the anchor of Senso. One is a 27-metre lap pool adjoining a heated spa, designed for everyday fitness rather than just summer leisure. The second sits on a lower podium, allowing different buildings to share in vertical access and reducing crowding during peak times.

It is the secondary spaces that start to distinguish Senso from other large-scale suburban projects. A rooftop cinema is integrated into a landscaped terrace, offering open-air screenings with natural ventilation and passive cooling.&nbsp;

The inclusion of a “sensory walk”, an elevated boardwalk that threads through the site, suggests a rare investment in non-commercial, non-essential amenity: space for quiet movement that doesn’t double as access or traffic circulation.

[smartcode_project:default project_id=134954 project_image_fid=4402]

The gym and wellness centre, often relegated to a small ground-floor room in many builds, takes on more substance here. Residents have access to a fully equipped gym, as well as outdoor yoga areas and meditative zones that integrate greenery and natural light.&nbsp;

The Club Lounge is similarly designed to support multiple use cases, with a private dining terrace, kitchenette, workspace, and lockable wine storage. These aren’t superficial additions; their scale and spatial allocation indicate serious intent for frequent resident use.

[smartcode_project:default project_id=134954 project_image_fid=4391]

Importantly, Senso’s amenities are embedded within a site that spans more than 10,000 sqm, allowing for better separation between spaces and reduced noise spillover, a critical but often overlooked factor in high-density developments. This spatial generosity also enables multiple alfresco kitchens and communal terraces without compromising individual privacy or usable space.

While many developments make claims about lifestyle, few back it with this level of built infrastructure. Senso’s mix of dedicated fitness, wellness, social and passive green spaces suggests a conscious response to the post-pandemic shift in housing expectations, especially among owner-occupiers.&nbsp;

DASCO is one of several leading developers who have taken out Resilience Insurance's Latent Defects Insurance policy, providing buyers with a 10-year structural and waterproofing warranty, and giving them the ultimate peace of mind.

Senso is scheduled for completion in late 2028.

[smartcode_project_cta:default project_id=134954]

Staff Writer

The outdoor amenities elevating life at Senso, Epping

Following the proposal by the Minns Labor Government to rezone Parramatta Road to create up to 8,000 new homes, prominent developer Ceerose has gone to the NSW Gov to increase the density of its new mixed-use residential building in Leichhardt.

<a href="https://www.apartments.com.au/builders/ceerose">Ceerose</a>, founded by Edward Doueihi nearly three decades ago, has filed plans for 154 apartments above ground-floor retail at 307-315 Parramatta Road, a key corner site near Norton Street, the main high street strip in Leichhardt.

It's an upsize from the previously approved scheme of 63 apartments across a seven-storey building.

<img alt="Ceerose" data-entity-type="file" data-entity-uuid="ba1ae75b-5f08-43fb-b8d5-3de6d9f6ef71" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-04%20at%2010.31.39%E2%80%AFAM.png?VersionId=yA3hBBLPH4ev7MsAE0_hieXeqiFqBUb7" />

The project is being advanced through the State Significant Development (SSD) pathway, with concurrent rezoning sought to facilitate the proposal. The 10-storey development would rise over a four-level basement and deliver two retail tenancies, one a larger-format offering and the other a smaller “hole in the wall” space, addressing the Parramatta Road frontage. 21 of the apartments are dedicated as affordable housing.

According to the Urban Design Report by Architecture AND, the scheme includes a podium and tower configuration, with a fine-grain, two-storey parapet street wall that references the traditional shopfront rhythm along the corridor. “An elegant tower form is proposed, combined with a characterful two storey frontage... articulating it as two related buildings, providing consistency with the rhythm and grain of Parramatta Road,” the report notes.

The residential component is split across two slender towers set back from the street edge, a design move aimed at preserving solar access and reducing perceived bulk. This massing strategy also seeks to improve residential amenity by focusing scale toward the quieter northern interface, away from Parramatta Road’s noise and pollution.

<img alt="Ceerose" data-entity-type="file" data-entity-uuid="347f2f8f-5d36-4388-b40a-2e77380b9c19" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202025-12-04%20at%2010.31.02%E2%80%AFAM.png?VersionId=xvyUE2ujT1lzivXTo.mHBJFF4SmfgLtz" />

Architecture AND has worked with Ceerose on previous Inner West projects, and cites a deep familiarity with the local character. Their design draws heavily on context, heritage, and sunlight access considerations, and engages with the Inner West Council’s “Our Fairer Future” strategic planning framework.

The site spans 2,712 sqm and is located near key intersections with Catherine Street, Hay Street, and Redmond Street. It adjoins a public carpark to the north and is within walking distance of Stanmore and Petersham stations. It is also flagged in state and local planning strategies, including the Parramatta Road Corridor Urban Transformation Strategy, as a suitable candidate for increased density.

Ceerose recently completed The Alex Collective on McEvoy Street in Alexandria, Abbie's Lane in Annandale, and the award-winning Munro House in Elizabeth Bay.

The Parramatta Road corridor is coming to life with the proposed rezoning which is serviced by a significant number of bus, light rail and train routes.

Deicorp is progressing with its $1.8 billion <a href="https://www.apartments.com.au/new-apartments/kings-bay-village-five-dock-53-75-queens-road-five-dock-nsw-2046">Kings Bay Village</a> precinct on Parramatta Road in Five Dock, as is <a href="https://www.apartments.com.au/news/nsw/toga-to-push-on-with-five-dock-mixed-use-masterplan">TOGA further down the street</a>. Those two projects alone will bring nearly 2,000 new homes to Parramatta Road.

Joel Robinson

First look: Ceerose plots mixed-use Leichhardt development on Parramatta Road

North Sydney's landmark 'SBS Building' on Alfred Street is set to be demolished to make way for a new mixed-use residential tower in the booming North Sydney.

Commercial property group FiveX is behind the plans for a <a href="https://www.apartments.com.au/new-apartments/275-alfred-street-north-north-sydney-nsw-2060">39-storey tower</a>, the latest project to advance under the NSW Government’s Housing Delivery Authority pathway.

They are proposing 184 apartments above retail spaces, which will replace the existing 20-storey commercial building. FiveX was set up more than five decades ago by Joshua and Marko Berger. It is currently led by Joshua's son Lesli.&nbsp;

<img alt="First look: Fivex plans 39-storey residential tower at 275 Alfred Street, North Sydney" data-entity-type="file" data-entity-uuid="2efa0980-53fa-4cca-9f9e-9c3c845d4746" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29%20%281%29_0.png?VersionId=y_YyPMq3NQLfYRs84pP4os9UgWiMLp75" />

According to the Architectural Design Report by <a href="https://www.apartments.com.au/architects/fjc-studio">FJC Studio</a>, the slender tower form has been deliberately designed to respect the site's transitional setting at the southern gateway to the North Sydney CBD, where high-rise towers give way to lower-scale residential precincts.

"The slender tower form and articulated podium establish a respectful relationship with nearby heritage and low rise buildings, including the Whaling Road Heritage Conservation Area,” the architecture firm noted, adding that the tower “completes a missing link in the urban fabric” while enhancing the Alfred Street streetscape.

The proposed building will include a mix of one-, two- and three-bedroom apartments, with 15 percent of the gross residential floor area allocated as affordable housing. There is an agreement already in place that those apartments will be managed by Evolve Housing.

The project aligns with broader state housing objectives, including the National Housing Accord target of delivering 1.2 million new homes by 2029. The Scoping Report filed with the State Significant Development Application (SSDA) suggests the site "presents no impediments to rapid delivery,” with construction able to commence within 12 months of receiving consent.

North Sydney has been one of the most popular suburbs in Sydney for new and off the plan apartment development, but hasn't had the supply to keep up with demand, until recently.

AURA by Aqualand was, for a long time, the only off the plan apartment building on the market. That completed last year, and has sold the majority of its 386 luxury apartments. Recently ALAND launched <a href="https://www.apartments.com.au/new-apartments/the-walden-173-179-walker-street-north-sydney-nsw-2060">The Walden</a> on the same street, selling over $100 million within just a few hours of its launch, while developer CASA also launched&nbsp;<a href="https://www.apartments.com.au/new-apartments/the-mclaren-north-sydney-45-mclaren-street-north-sydney-nsw-2060">The McLaren</a>&nbsp;in the same precinct.

First look: Fivex plans 39-storey residential tower in booming North Sydney

Kokoda Property Group has announced the Sydney-based Versatile Construction as the builder for its landmark $1.5 billion <a href="https://www.apartments.com.au/new-apartments/teneriffe-banks-17-27-skyring-terrace-teneriffe-qld-4005">Teneriffe Banks</a> precinct.

Construction of the 17,612 sqm site is scheduled to commence in December 2025 and is expected to be delivered in stages from 2028. Once complete, <a href="https://www.apartments.com.au/new-apartments/teneriffe-banks-17-27-skyring-terrace-teneriffe-qld-4005">Teneriffe Banks</a> will comprise 212 residences across four architecturally distinct buildings, alongside Brisbane’s first Kimpton Hotel, extensive retail, hospitality, and wellness amenities.

[smartcode_project:default project_id=139896 project_image_fid=295098]

Kokoda Property Group Founder and Managing Director, Mark Stevens, said appointing Versatile Construction marks a significant milestone for <a href="https://www.apartments.com.au/new-apartments/teneriffe-banks-17-27-skyring-terrace-teneriffe-qld-4005">Teneriffe Banks</a>.

“Partnering with Versatile Construction gives us confidence in delivering a precinct that sets a new benchmark for luxury living, curated experiences and vibrant riverfront activation," Stevens said.

"Together, we will bring the vision for <a href="https://www.apartments.com.au/new-apartments/teneriffe-banks-17-27-skyring-terrace-teneriffe-qld-4005">Teneriffe Banks</a> to life, creating a destination that residents and visitors will enjoy for generations."

Throughout the construction phase, more than 2,000 jobs will be created, supporting hundreds of local contractors and suppliers.

[smartcode_project:default project_id=139896 project_image_fid=352274]

Marco Fahd, Chairman &amp; CEO at Versatile Group, said the company is looking forward to&nbsp;expanding their footprint in the state, taking on their inaugural project in Brisbane.

"We are proud of the unwavering commitment our team of experts have to quality and certainty in delivery and are excited to work with Kokoda to bring their vision for this unique project to life," Fahd says.

Sales reached $285 million on the launch of <a href="https://www.apartments.com.au/new-apartments/teneriffe-banks-17-27-skyring-terrace-teneriffe-qld-4005">Teneriffe Banks</a>, with sales momentum continuing to "exceed all expectations."

Stevens says the overwhelming response from buyers validated the group’s vision for <a href="https://www.apartments.com.au/new-apartments/teneriffe-banks-17-27-skyring-terrace-teneriffe-qld-4005">Teneriffe Banks</a>.

“The demand for a luxury product in this enclave has been extraordinary, we’ve never seen anything like it before. It reinforces everything we’re doing around quality, design, and creating genuine lifestyle precincts. Buyers are recognising the enduring value of Brisbane’s riverfront and are responding to the opportunity to live within a world-class destination that celebrates both place and lifestyle.”

[smartcode_project_cta:default project_id=139896]

Kokoda appoints builder for $1.5 billion Teneriffe Banks waterfront precinct

Castle Hill’s booming development market is set for another boost, with builder-developer Buildex proposing a new mid-rise apartment building near Castle Towers.

Buildex has submitted plans to The Hills Shire Council for a <a href="https://www.apartments.com.au/new-apartments/197-old-northern-road-castle-hill-nsw-2154">nine-storey building comprising 57 apartments</a> on Old Northern Road. The company acquired two adjoining sites earlier this year, totalling more than 2,683 sqm.

Texco Design has prepared the scheme, which includes five one-bed plus study apartments, 37 two-bedrooms, and 15 three-bedrooms.

Castle Hill has become a hotspot for developers in recent years, undergoing significant transformation driven by the opening of the Hills Showground Precinct to development and the introduction of two metro stations servicing the suburb.

Developers including Deicorp and Kassis Homes have already completed projects, and are progressing future developments, while Meriton, Arada, and Ellipse are currently delivering new projects in the rapidly evolving area.

First look: Buildex plans 57 apartments near Castle Towers

Electricity

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GUEST OBSERVATION
It is difficult to make predictions, especially about the future. (attributed to Danish physicist Niels Bohr)
The difficulty of making predictions has long been known, but the rise of the internet means that it is getting harder to hide the gaps between predictions and reality.
Perhaps the most significant example of repeated failed projections has been the International Energy Agency’s projections of the importance of renewable power – the proportion of electricity generated by solar and wind and other renewable sources other than hydro.
Beginning in 1994, when generation from these sources was negligible, the Agency has produced estimates of the future share of renewables every two years.
Every two years, with striking regularity, the previous estimates have been exceeded (hugely) and the new set has been revised upwards. But never by enough. Each time the upward revision has been inadequate.
This graph, prepared by <a href="https://www.quora.com/q/xwpxpfefwalgifkr/A-modest-proposal-to-the-International-Energy-Authority" target="_blank">Paul Mainwood</a> from IEA reports, illustrates the point:
Projections versus reality
<a href="https://images.theconversation.com/files/302056/original/file-20191117-66945-19v9ijz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/302056/original/file-20191117-66945-19v9ijz.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Reality versus repeated projections of renewables share of electricity generation (ex hydro). <a class="source" href="https://www.quora.com/q/xwpxpfefwalgifkr/A-modest-proposal-to-the-International-Energy-Authority" target="_blank">Paul Mainwood, Quora</a>
The dashed lines represent successive projections from 1994 to 2016.
The solid red line represents the actual growth of non-hydro renewables as a share of total electricity generation.
What can be seen is that eleven times in a row the projected growth in renewables was far too low and had to be upgraded. Eleven times in a row the upgrades weren’t big enough.
As a joke (indicated by the green line) Mainwood “corrected” the 2016 projection for the typical under-projection:
Projections plus “corrected” 2016 projection
<a href="https://images.theconversation.com/files/302067/original/file-20191117-66953-1tfh6u0.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/302067/original/file-20191117-66953-1tfh6u0.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Reality versus projections of renewables share of electricity generation (ex hydro) plus 2016 projection corrected for typical undershoot. <a class="source" href="https://www.quora.com/q/xwpxpfefwalgifkr/A-modest-proposal-to-the-International-Energy-Authority" target="_blank">Paul Mainwood</a>
Projections often understate change
Another striking example relates to religious belief. In 2015 the Pew Research Institute released a <a href="https://www.pewforum.org/2015/04/02/religious-projections-2010-2050/" target="_blank">report</a> suggesting a gradual decline in Christianity in the United States.
The headline finding for the US:
"Christians will decline from more than three-quarters (75%) of the population in 2010 to two-thirds (66%) in 2050."
Yet only four years later in 2019, Pew released another report with this headline finding about the US:
'In 2018 and 2019, 65% of American adults describe themselves as Christians when asked about their religion, down 12 percentage points over the past decade."
Thus, a decline expected to take forty years had taken place inside ten.
Moreover, Christian affiliation is highest in the older age cohorts, very few members of which will be around in 2050. Looking at the younger cohort born after 1981, only 49% claim a Christian affiliation, a proportion that has declined by 16 percentage points in a decade. Unless that trend is rapidly reversed, or later cohorts experience a religious revival, Christians will be a minority well before 2050.
They enable modellers to escape responsiblity
Faced with outcomes of this kind, modellers often defend themselves by drawing a distinction between “predictions” and “projections”.
A prediction (Latin for “foretelling”) is a claim about what is most likely to happen in the future. By contrast, a projection (“casting forward”) is a model output derived by extrapolating past trends, holding some parameters constant and allowing others to vary.
The International Energy Agency projections were characterised by the assumption that the costs of renewable energy would change only slowly, rather than continuing the extraordinary decline that began in the 1970s.
In the case of the Pew projections, the crucial parameter is conversion rates – the frequency with which people brought up with one religion (including “no religion”) change to another. The Pew projections were based on the assumption conversion rates will remain unchanged.
It is the opposite of the widely-held but controversial “secularisation hypothesis” which states that modernisation leads to increased conversions to “no religion”.
Predictions force them to take responsibility
Projections are useful in the development of models. All models are based on past experience and have to assume that in some respects the future will be like the past. By examining the projections generated under particular assumptions about which variables and parameters will remain constant, it is possible to understand how models works and make modelling choices.
But projections of this kind are of no use in informing people not familiar with the material. They mislead casual readers of the Australia’s budget.
The budget uses both predictions and projections.
For the two years following each budget the Commonwealth uses “forecasts” which it is prepared to stand by, then for the next two it presents mechanical “projections”:
<img src="https://images.theconversation.com/files/302072/original/file-20191117-66957-w8vxaq.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
<a class="source" href="https://www.budget.gov.au/2019-20/content/bp1/index.htm" target="_blank">2019-20 Commonwealth budget, Budget Paper 1</a>
When asked to defend (for example) its wage growth number of 3½%, the treasury points out that it is a mechanical projection rather than a forecast, a distinction lost on all but the most enthusiastic of budget devotees.
In practice it is impossible to separate the two.
Even though both the International Energy Association and Pew describe their estimates as “projections” they are almost invariably <a href="https://www.mining.com/new-iea-report-predicts-surge-in-global-coal-use-2/" target="_blank">treated as</a> <a href="https://www.pri.org/stories/future-religion-around-world-one-chart" target="_blank">predictions</a>. 
Since any statement about the future will be treated as a prediction, the only serious option for modellers prepared to be truthful with the public is to bite the bullet and make predictions.
It means working hard to make the best possible estimate of the future paths of all model parameters, and using judgement to take account of everything else.
It’s what those of us looking to experts for guidance deserve.<img src="https://counter.theconversation.com/content/126734/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
John Quiggin, Professor, School of Economics, The University of Queensland.
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/please-no-more-projections-what-we-need-are-predictions-and-theyre-harder-126734" target="_blank">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

Please, no more projections. What we need are predictions, and they’re harder

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<img src="https://counter.theconversation.edu.au/content/82264/count.gif?distributor=republish-lightbox-advanced" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
It sounds like good news. After summoning the heads of Australia’s major electricity retailers to Canberra, Prime Minister Malcolm Turnbull yesterday announced that the government will take “decisive action to reduce energy prices for Australian families and businesses”.
But look a little closer. Yes, the retailers have agreed to some small but important measures that will make it easier for customers to find the best electricity deal. But there is no guarantee energy prices will fall. And your electricity bill will only be lower if you, the customer, take action.
Retailers’ current advantage
At the moment, retailers typically encourage consumers to sign up by offering a discount on the bill for a fixed period – normally one or two years. After this period expires, customers usually face higher prices for their electricity. 
Some lucky customers will be put on an equivalent tariff and their electricity costs will not change much. Others will lose the discount – which can be as much as 30% of the bill. And some unlucky customers will be placed on the retailer’s “standing offer” – usually the most expensive plans in the market. 
All the retailers have to do is to send you a letter informing you of the change. Lots of customers find those letters too confusing or time-consuming to read, and throw them in the bin. Those who do read and understand it don’t necessarily take action: almost half of Australian households have not changed their electricity retailer in more than five years.
How the new deal could help you
Under the deal that Turnbull has brokered with the retailers, every consumer on a lapsing deal will be sent more comprehensive and helpful information that will encourage them to switch. This will include details of cheaper available offers, and information from websites that compare prices across the various plans and retailers. 
Second, as the Grattan Institute recommended in our March report, Price Shock, retailers will now have to be more explicit about what happens if you don’t sign up to a new offer. Specifically, that means detailing exactly how much it is going to cost you. 
Third, retailers will have to report to the Australian Energy Regulator how many customers are on lapsed deals. This may seem like a lot of red tape for not a lot of impact. But a lack of information on how many customers are on what type of deal has been a major barrier to understanding what is happening in the electricity market. This increased transparency will encourage retailers to reduce the number of customers they have on lapsed contracts. 
The new deal includes other welcome measures, mainly designed to help poor households reduce their bills and make sure they do not face increased costs as a result of late payments. (To be fair to the retailers, they already do a lot for customers whom they consider to be “in hardship”.) 
It’s still down to you
The deal will doubtless improve the retail electricity market. Retailers will take on more responsibility for helping their customers onto a better deal. And those customers who are most at risk from very high prices will get more protection. 
But these are only incremental steps and do not ensure that customers will pay less for their electricity. While more simple information will be available, it will still be up to the consumer to act on it. The bottom line remains the same: if you want to pay less for electricity, you need to search for and sign up to a cheaper deal. 
Customers should be under no illusions. Energy prices are still going to be high for as far as the eye can see. 
Gas prices remain way above historic levels. Wholesale electricity prices are also high. Network costs – the price we pay for the poles and wires – have grown enormously over the past 20 years, and ultimately those costs find their way onto our bills. And the much-needed policy stability on greenhouse emission reductions that can put downward pressure on electricity costs remains elusive.
Under the new rules, consumers might be able to get a cheaper deal, but this doesn’t mean they will get a cheap deal. 
It may be months before we know whether the new measures are enough to encourage consumers to go out and find a cheaper plan or retailer. The danger is that, in a year’s time, too many consumers will still be stuck on expensive electricity deals. 
Even if huge numbers of consumers switch, there are still fundamental issues in Australia’s electricity market. Prices won’t come down across the board until these are resolved. 
This is a welcome move by the government. But it only addresses a fraction of the problems in the electricity market. The big question for the prime minister is, what next?
<a href="https://theconversation.com/profiles/david-blowers-141792" target="_blank">David Blowers</a> is Energy Fellow, Grattan Institute and author for <a href="https://theconversation.com/au" target="_blank">The Conversation</a>.
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jchancellor-FAypfDUnLy

New rules for retailers, but don’t sit there waiting for your electricity bill to go down

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<img src="https://counter.theconversation.edu.au/content/66049/count.gif" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
The latest bid for a share of the New South Wales electricity distributor, Ausgrid, from two big Australian superannuation funds is part of a wider investing trend where infrastructure is the new black.
AustralianSuper and IFM Investors announced an unsolicited offer of a reported A$10 billion after two much larger bids from Chinese interests were controversially disallowed by Treasurer Scott Morrison on national interest grounds.
When big infrastructure assets come up for sale in Australia now, there are increasingly only three types of bidders: Chinese state-owned firms, large Canadian pension plans and local superannuation funds.
Superannuation funds have traditionally invested the bulk of their members’ contributions in the share market. The most profitable companies are usually those listed on stock exchanges and holding shares is widely seen as the best way to ensure long term investment success.
But stock markets can also go down, bringing down superannuation balances with them, as many Australians discovered for the first time during the global financial crisis. Investing in infrastructure has developed as an increasingly popular alternative to holding most of a superannuation fund’s investments in shares.
The returns available in infrastructure are comparable to those available on the share market but they have the added advantage of being more stable. Airports, toll roads, ports and utilities (including electricity infrastructure) have become key targets for superannuation fund managers, both in Australia but also increasingly in Europe, North America and Asia.
<h2>Who are AustralianSuper and IFM Investors?</h2>
With an investment portfolio of more than A$100 billion, AustralianSuper is the country’s largest superannuation fund. Formed in 2006 after the merger of the Australian Retirement Fund (ARF) and the Superannuation Trust of Australia (STA), AustralianSuper has a long history of investment in infrastructure.
Long-term ARF and STA trustee (and former ACTU secretary) Bill Kelty is a particular advocate of infrastructure investment. As AustralianSuper CEO Ian Silk acknowledges, much of AustralianSuper’s investment success can be ascribed to Kelty’s emphasis on infrastructure.
Pairing up with AustralianSuper is IFM Investors. Managing more than A$72 billion worth of infrastructure assets, the super fund is the country’s leading player in the infrastructure sector.
IFM was formed in 2004 (as Industry Funds Management) and is the successor to the Development Australia Fund (DAF). It is owned by 29 industry superannuation funds and invests on a global scale.
DAF was launched in 1991 by the ACTU in collaboration with the AMP Society and the Australian Chamber of Manufacturers. Chaired by Ian Court, the head of Cbus (the building and construction industry superannuation fund), DAF led the push of the industry funds into infrastructure investment. On behalf of the industry funds, DAF partnered with AMP in the privatisation of airports, purchased toll road companies and invested in the renewable energy sector.
Like other businesses owned by the industry funds, IFM is run on a cut-price “all profits to members” basis. It buys up infrastructure assets on behalf of the industry funds, allowing their millions of members to profit from government privatisations.
<h2>Super funds leading infrastructure investment</h2>
The Canadians have only recently cottoned on to the idea that investment in airports, shipping terminals and electricity assets is ideal for retirement-savings schemes. Members of superannuation funds expect their nest eggs to grow over the 30 years or more of their working lives. Infrastructure investments match long term financial returns with the long term investment horizon needed by a pension or superannuation fund.
Rather than being sold to foreign firms or wealthy investors, the involvement of the industry funds in infrastructure privatisations means that all working Australians can benefit.
However the movement of the industry funds into infrastructure has been widely criticised by Coalition politicians. In 2007, the then Treasurer Peter Costello dismissed infrastructure investments as “union pet projects…like rats eyeing the grain silo”.
Infrastructure privatisations are controversial. But selling electricity distributors to superannuation funds means that everyday Australian workers can profit from owning them. Unlike investing in derivatives and bonds, infrastructure investment is a form of direct ownership.
Bernard Mees is senior lecturer in Management, RMIT University and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/bernard-mees-182089" target="_blank">here</a>.
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Electricity infrastructure like Ausgrid is a safe bet for super funds

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<img src="https://counter.theconversation.edu.au/content/64213/count.gif" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
The European Commission’s latest Quarterly report on electricity markets makes sobering reading down under.
Over the last year wholesale electricity prices have been falling just about everywhere across the developed world except here in Australia, where they are skyrocketing.
Australian prices are now above the European average, well above the US and rapidly converging with Japan, which is still recovering from the shock of Fukushima in 2011 when prices rose to over eight times Australian.
With Japan now reactivating nuclear power production, and Australian LNG exporters putting the squeeze on domestic gas markets, it can be anticipated that Australia will soon be top of the price tree. Indeed, with 2016 Q2 and Q3 Australian prices rising at unprecedented rates, it probably already is.
Combined with exorbitant power distribution costs, the alarming trends highlighted by the EC’s report will be exercising the mind of our new Federal Minister for the Environment and Energy, Josh Frydenberg.
<h2>How fast are Australian prices rising?</h2>
The trends highlighted by the EC’s report are expressed in Euros, so they somewhat obscure local dynamics. In reality, Australian wholesale prices are rising more steeply than ever before, having risen by around 45 percent over the last year. Prices over the last six months are now higher in aggregate than at any comparable time during the carbon tax period, which added around 50 percent to wholesale prices in the period 1/07/2012 - 17/07/2014. When the impact of the carbon tax on 2014 prices is removed, prices are up by more than 65 percent in just 2 years. 
Compared to the same period one year earlier, wholesale prices have risen across all seasons and all jurisdictions in the last year, excepting summer in Queensland. The rate of increase has risen steadily from the spring 2015 through to the winter 2016. For the winter period of 2016, prices were up by an average by 85% compared to the previous winter, with the increase ranging from 65 percent in Queensland to 115 percent in South Australia. 
<h2>Why are electricity prices falling everywhere but Australia?</h2>
The reasons for wholesale electricity price falls in Europe and Japan are straightforward.
Both are dependant on imported gas, and with the oil-linked price for gas falling, so too are electricity prices. In the US market, the flood of shale gas greatly exceeds export capacity, so there is a continuing glut of cheap gas [1].
The story in Australia is quite different. Despite a three fold increase in gas production in the last few years, due to the opening up of new coal seam gas (CSG) fields in Queensland, the Australian domestic market is being squeezed as LNG exporters struggle to meet supply contracts.
In the Australian CSG industry it is an open secret that some exporters agreed punitive clauses in contracts should they fail to fill their LNG trains. Despite strong opposition from former industry champions such as John Ellice-Flint, exporters such as Santos stretched themselves on production by committing to two LNG trains. Now gas is being diverted from domestic markets to avoid industry collapse. The consequence is that Australian gas consumers are increasingly subject to scarcity pricing when domestic prices can rise to many times that which international buyers have contracted for the same gas.
Not surprisingly, steep rises in the cost of gas is causing a reduction in gas use in domestic electricity markets. In Queensland gas fired power output in the winter of 2016 was down about 250 megawatts or 20% on the year before. Meanwhile black coal generation was up 450 megawatts, with Queensland’s CO2-production from the electricity sector increasing by 5%.
An insight into the impact of the rising cost of gas on our electricity market is provided in the figures below, which show how market prices varied with gas dispatch in Queensland over the winters of 2015 and 2016, respectively. In winter 2015, when gas dispatch averaged 1076 megawatts, there was no correlation between wholesale prices with the amount of gas dispatch, consistent with gas generation being a price taker. Then the average price of electricity was $39.6 per megawatt hour.
By winter 2016, when gas dispatch averaged 833 megawatts, a strong price correlation had established as gas generators increasingly set the price. Average prices had risen to $65.2 per megawatt hour with spot prices increasing almost $100 per megawatt hour for each additional gigawatt of gas dispatch. 
<h2>We really need to talk about gas</h2>
In 2015, the availability of “ramp” gas made Queensland settings somewhat analogous to the US, where cheap gas increasingly fuels electricity generation. By winter 2016 when more LNG export trains had been commissioned, scarcity pricing was manifesting in our domestic gas markets impacting our electricity market big time.
As the EC’s quarterly market report flags, the historical competitive advantage Australia has had as a cheap provider of electricity has been obliterated in a little over a year. And that is without any carbon tax. It is hurting most severely in South Australia which has always been more exposed to gas prices than other states by virtue of its limited coal reserves.
While several compounding factors have played out in extreme electricity price rises in South Australia, as discussed in my last post, the broader rises across Australia have their underpinnings in the rising domestic gas market prices as well as contractual arrangements in gas piping. The smoking gun is the resent steep rise in Queensland electricity prices - a market that remains essentially a  renewable free zone.
The damaging reality of the situation is highlighted by a recent post on the tech website Whirlpool.
“We are a business in SA [South Australia] with high usage (use up to 14MW), on spot pricing since June 1st – and are turning everything off when a spike hits – but the last 5 minute spike was at the end of the half hour pricing cycle (price is averaged in half hour periods). We just chewed through $75,000 worth of power in a half and hour! (we are used to paying $1000). This period while the interconnector is down could effectively burn about 3 years of profits in 4 working days if the forecast prices come to fruition.”
One might ask why such energy users exposed themselves to spot (wholesale) pricing (the norm is via the contract market). Whatever, the cautionary is that 14 MW represents 1% of average South Australian power consumption. Ten such business at threat of going under would be devastating, with potential to reduce South Australian electricity demand by 10%.
<h2>The horse has bolted, so what next?</h2>
The EC’s quarterly market report was already flagging in Q1 2016 that Australian electricity production was expensive by international standards. Since then, further steep price rises across the NEM in autumn and winter 2016 have further exacerbated price differentials, surely now placing Australia amongst the most expensive producers of electricity in the world.
No doubt the gas lobby will absolve the industry from any responsibility for the recent events that have transpired on our electricity markets, arguing the solution lies in even more gas production, and that renewable energy policies are more to blame.
To be sure, eastern Australia is short on supply of cheap conventional gas from the offshore Gippsland Basin and a few other locations. Expanding the gas base by exploiting unconventional resources such as CSG was always going to come at a price, since such resources are inherently more expensive.
But developing the new CSG fields at such scale was always going to risk that production would fall short of targets. As much was acknowledged by the joint Department of Industry and Bureau of Resources and Energy Economics study into Eastern Australian gas markets.
The current development of LNG in eastern Australia and the expected tripling of gas demand are creating conditions that are in stark contrast to those in the previously isolated domestic gas market. The timely development of gas resources will be important to ensure that supply is available for domestic gas users and to meet LNG export commitments. Such is the scale of the LNG projects that even small deviations from the CSG reserve development schedule could result in significant volumes of gas being sourced from traditional domestic market supplies.
The hope is that the events of 2016 are transients, related to temporary development schedule difficulties. If they are not, then god help domestic consumers, not just those exposed to electricity prices but also right across the gas sector. A broader question for our gas exporters is just how much risk from any such development schedule difficulties is appropriate to defray onto domestic consumers? As the Eastern Australian Gas Markets Study highlights, it is not as though such circumstances were not anticipated.
In prosecuting the case to deliver more of our national gas resources to market, perhaps it is not too much to ask that domestic gas consumers are offered some insurance against any further development schedule difficulties incurred by our exporters? After all, it is our gas.
Domestic reservation, anyone? - at least while transitional issues work through the system.
[1] Shale gas economics in the US is linked to co-produced liquids, and thus differs markedly from the CSG fields in Australia where there is no liquid hydorcarbon production.
Mike Sandiford is chair of Geology &amp; Redmond Barry Distinguished Professor, University of Melbourne and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/mike-sandiford-228" target="_blank">here</a>.
 
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