Rail’s role in Society

by Rail Express — last modified Aug 29, 2012 10:56 AM

— filed under: Weekly Top Stories, Rail

What role has rail played in Australia’s history and how will this change in times to come? Paul Bugler* provides an informed view on passenger and freight rail’s role in our nation’s past, present and future.

   

Courtesy RailGallery

“Rail’s Role in Society” is this year’s conference theme at Australasia’s largest rail event, AusRAIL, to be held on November 27-28 in Canberra.

Since its inception, rail has shown its ability to adapt to a changing environment. From its early dominance, rail’s role has gradually changed as roads and road vehicles have steadily improved.

The initial focus of transport needs in Australia was between the hinterland and the ports and coastal cities. It is striking how each state-based (originally colonial) rail system was oriented in this way. Interstate (inter-colony) connections were very much an after-thought and the trans-Australia connection between east and west wasn’t completed until 1917.  We also invented the world’s worst mixed gauge problem!

Over the last 50 years, rail has gradually retreated to those tasks where its strengths come to the fore. Rail’s role in passenger traffic is now effectively restricted to that of urban transit where the need is to move large volumes of people over modest distances relatively quickly.  With choked roads in our larger cities, it is rail that makes it possible to maintain our widely disbursed urban populations. But rail is no longer a substantial provider for long distance passenger movement, though state governments persist in providing expensive and poorly utilised services. Air, buses and private cars provide too many advantages for rail to compete except at the margins.

Similarly, rail struggles to compete with road vehicles for much of the general freight task.The recent BITRE/ARA publication TrainLine 1 estimates that for NSW-Victorian interstate freight movements, rail carries only around 8%. This is over a distance of 850km by road (950km by train – which tells its own story) where one would expect rail’s competitive advantage in long-haul would start to show. It is only on the very long east-west hauls, between the east coast and Perth, where rail really dominates the intermodal market with variously 60%-80% market share.

It is in the bulk freight area where rail really shines. Wherever product is relatively dense, in large volumes and amenable to flowing into and out of freight wagons, rail has generally been the preferred mode of land transport. It is in the movement of traffics like iron ore and coal where rail has shown substantial increases in traffic volumes. Rail is perfectly suited to the land-side task of moving these products to port. Rail is also a major carrier of grain though, unlike minerals, this traffic has seen a gradual reduction in the sites serviced, and the extensive grain branch line network throughout the country has been under significant pressure.

Governments have struggled in recent decades with what role they want regional rail to play, how it should be managed and funded. Generally, the state governments have allowed their regional networks to deteriorate. Lines have been closed and where kept open, spending has been kept to the minimum necessary to maintain existing operations. Little money has been spent on modernisation except where lines can be funded by minerals traffics. In contrast, governments have invested heavily in their urban passenger networks and the interstate network.

Coupled with the funding dilemma we have seen significant change in the ownership model for Australia’s railways.  Vertical separation between track and train operation has been implemented, allowing for competition between train operators. At the same time some governments have divested themselves of their rail networks and operations to the private sector – in two cases re-acquiring networks where private commercial returns could not sustain them. These reforms have given rise to substantial competition between train operators. The advent of vertical separation has also brought a complex mix of regulation with various state and federal bodies governing aspects of the rail system. The rail networks themselves are no longer strictly state based but are under a patchwork of ownership.

So where will Australian rail be 20 years from now? Several factors will work in rail’s favour, gradually over the years. Rail enjoys an environmental advantage over road transport with its more efficient use of diesel fuel. Both climate change and the increasing scarcity and hence price of oil mean that road will become less competitive for intermodal movements, particularly if rail can continue to improve service quality – something that it has struggled with in the past. I expect that rail will improve its inter-capital freight share, slowly but inexorably. This will need to be underpinned by substantial investment in terminals, rolling stock and track.

I think the proposed inland route between Melbourne and Brisbane will eventually happen, but I suspect this will come later rather than sooner. As volumes between those cities grow, the economics will improve, but it is a huge capital cost that cannot currently be justified.

Rail will continue to dominate the heavy haul transport sector. The prospects for Australia’s minerals industry suggest that rail will have a growing task for the foreseeable future.

The prospect for regional networks is less clear. Governments are unsure whether to retain their diverse grain networks. These are almost uniformly in need of major investment to allow for modern high axle-load operations. I expect that there will continue to be rationalisation with branch line closures and consolidation around a smaller group of more viable lines, but to keep even these going will require substantial investment.

The role of medium and long distance passenger is harder to predict. There is much interest high speed passenger links, but the economics are difficult. My view is that high speed passenger rail makes sense between large population centres that are not too far apart – say Sydney and Canberra. But the state capitals are too far apart to make high speed rail between them viable, unless there are substantial impediments in the future to air travel either through cost, environmental factors or congestion. I expect that governments will feel obliged to continue to provide the current level of country passenger services, but these will continue to struggle to be justified.

Finally, urban passenger rail will continue to be an integral part of our large cities. As fuel becomes increasingly more expensive, as congestion rises, rail will be the mode that can best provide transport from outer urban hubs to city centres.Rail is here to stay and it will thrive.

*Paul Bugler is director of Lacertus Verum, a company providing rail consultancy services across a broad range of strategic, planning, rolling stock and operational areas.  Lacertus Verum is also part of the Dawn Alliance, a group of specialist consultancies offering a wide range of transport advisory services. Phone:             0430 312 565      . Email: paul_bugler@lacertusverum.com.au
Visit: www.lacertusverum.com.au