Tomorrow's Sydney is coming sooner than you think. In fact it starts next week. On Monday, to be precise, when buses will stop running down George Street, the very spine of Sydney's CBD, as a prelude to the construction of the light rail.

Nothing will be the same again: and that's a good thing. Light rail will not just strengthen the attractions of the city for tourists and business visitors. It will also definitively change the way that the entire transport system of the CBD works and how Sydneysiders access and move around it.

Buses will stop running down George Street in Sydney's CBD as a prelude to the construction of light rail. Credit:James Alcock

This is because new thinking is being developed by Transport for NSW on the back of the challenges of the light rail construction. The fact that light rail will take out some road supply has led to some first principles policy discussions to be had, the kind other global cities have been having for some time. At the heart is what transport techies call demand management. I believe that the shift towards demand management thinking is the key to a long term solution to Sydney's congestion challenge. The stakes are that high.

When roads get congested the traditional response has been to increase road supply. In practice, we then discover that new road supply can actually create extra car demand and the new capacity gets filled up very quickly. Congestion returns to the previous level despite our best intentions. However, we are about to discover in the CBD that the most effective way to manage congestion is to reduce and reshape demand.