$278 billion construction pipeline depends on faster, smarter environmental approvals – AI can help

Approximately $278 billion in construction work across housing and clean energy is relying on Australia’s environmental approvals system – but growing complexity, workforce shortages and outdated systems are putting delivery at risk. AI can help unlock the pipeline, according to a new report from CEDA.
 
The report, Approved: How AI and data can transform Australia’s environmental approvals, delivered in partnership with TechnologyOne, finds that even small improvements to approvals processes could unlock significant productivity gains across the economy, helping to accelerate housing supply and the energy transition.
 
 The report comes as Prime Minister Anthony Albanese has announced the commitment of $45m in the upcoming Federal Budget to speed-up and simplify approvals.
 
 “Australia has a massive pipeline of projects that depend on timely approvals,” said CEDA Head of Economics Liam Dillon.
 
 “If we can’t assess projects efficiently and effectively, we risk delaying the homes, infrastructure and energy systems the country needs. Regulatory and legislative changes will address some of the challenges, but better use of AI and data can help us go further.”

The report shows the approvals system is under increasing strain. Applications can run to thousands of pages, requiring complex scientific analysis and compliance with dozens of pieces of legislation. Assessing a single large project can cost hundreds of thousands of dollars in public sector time, while agencies face persistent workforce shortages and rising volumes of public submissions.

“Complexity, capability constraints and fragmented data are combining to slow decisions and increase costs.” Liam Dillon said.

CEDA found that artificial intelligence and better use of data can help address these challenges.

Regulators abroad facing similar difficulties have begun to adopt AI solutions and are seeing significant benefits. AI-powered tools in Denmark are helping regulators navigate previous approval decisions with ease, saving up to $80 million in time costs annually – nearly twice the amount pledged by the Albanese government in April to support more streamlined approvals.

“AI won’t replace human judgement, nor should it, but it can help decision-makers navigate complexity, reduce duplication and focus their expertise where it matters most. These tools are being adopted internationally and with careful design, there is no reason we can’t do the same here.” Liam Dillon said.
 
 Improved digital tools can also strengthen transparency and public engagement, making it easier for communities to understand and contribute to decisions about developments that affect them.

However, the report warns that the benefits of new technology will not be realised without addressing underlying weaknesses in data, systems and workforce capability. Many government systems are not designed to support modern data use, and only 12 per cent of public servants report feeling equipped to use AI tools in their work.

"Australia is at a turning point. The shift from IT to AI is the most significant economic transformation of our lifetime, and the decisions governments make now about where their technology comes from will determine whether Australia shapes its own future or has it shaped by others.” said Ed Chung, TechnologyOne CEO and Managing Director.
 
 “There is a real risk of layering new technology onto outdated systems. To get this right, we need to invest in the foundations – better data, robust security, stronger systems and the skills to use them.” Liam Dillon said.
 
 "That's why we are proud to partner with CEDA on this research. For almost four decades, TechnologyOne has built software in Australia, for Australia, and we believe it has never mattered more that our nation backs the technology it builds at home." said Ed Chung.

CEDA is calling for a coordinated national approach to approvals reform, including the establishment of a dedicated environmental approvals innovation taskforce and stronger requirements for data sharing across the system.

“Approvals reform and AI advances are happening at the same time. Bringing them together is a rare opportunity to make the system not just faster, but fundamentally better for communities, industry and the environment.” Liam Dillon said.

CEDA media contact:
Joanne Lilley, Director Programming and Marketing
Mobile: 0436 379 688 | Email: joanne.lilley@ceda.com.au 

TechnologyOne media contact:
Lauren Blank, General Manager – Public Relations
Mobile: 0473 004 744 | Email: lauren.blank@technology1.com 

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