Well, the good news, or bad news, depending on your reaction to pages of tables and graphs, is that too much was happening last month for me to revisit Network Rail’s challenge to the Rail Regulator’s daft Determination, as promised in the October column. Still, I all think we have enough background to judge the impact of the final Determination due to be published on 30 October.
What kept me from matters regulatory? Well, yet more encouraging news from the fight for a rolling programme of electrification, for a start
Compare the Government’s negative response to my electrification petition last year with the reference in Ruth Kelly’s valedictory Party Conference speech to ‘potentially the largest programme of electrification in our history’.
Not only has the anti-electrification policy in last year’s White Paper been reversed, the mood is surprisingly buoyant. We now have four independent financial Benefit:Cost Ratio studies for the
I compare the results in the Column and while the DfT Rail analyses are the most cautious, the officials responsible suggest that even on their numbers both schemes would be self financing through Network Rail’s Regulatory Asset Base.
By far the most detailed work is being done by Network Rail and I publish the results for the Great Western Main line Study which shows a Benefit:Cost Ratio of 1.7:1. MML is even better at 2.2:1. Also included are the sensitivity tests showing that the cases are robust.
DfT Rail’s internal studies are coming out at around 1.2:1. But, in part, this is because the diesel Intercity Express Programme (IEP) is being used for the ‘do-nothing’ base case, rather than real trains.
Meanwhile the Network Rail modelling team is moving onto the next route, probably
Also boosting electrification prospects are the installation techniques being developed by Network Rail’s new Electrification Group. These include up to three High Output Electrification Trains capable of wiring 1.5 km of plain line in a single 8 hour possession.
So, all good positive stuff, but a positive business case doesn’t mean the money will be available. Because electrification did not feature in the White Paper, there is no funding available and a way will have to be found for Network Rail to pay for project development and procurement of the specialist equipment.
Add in the current economic crisis and we could have the best case for electrification ever but no money to pay for it. Hard times ahead.
Even if I had the time, I don’t think I could face trying to make sense of the difference consultants’ interpretation of the same data on European railway maintenance and renewal costs as applied to Network Rail. But when Network Rail, in addition to challenging the Office of Rail Regulation’s analysis, also denied that Hatfield resulted in inefficient renewals expenditure, I felt a new spreadsheet coming on.
My gut feel is that today’s railway costs more than it ought to. But what ought the railway to cost?
To seek an answer I sampled the railway’s costs and outputs at five year intervals back to 1887/88, when the last economic boom was warming up. And the results are very interesting – particularly when you index the figures from the starting year.
Well, I hope you’ll find them as interesting as I did. The headline conclusion is that the total income (farebox and subsidy) needed to run the railway has doubled over 20 years, while train miles, which cause the wear and tear have increased by only 35% over the same period.
Something is wrong somewhere. What we need is not European benchmarking but a detailed analysis of how the money was spent and what it bought either side of Hatfield. But it’s a bit late now!
When was the last time I wrote about a new diesel locomotive with a new-to-traction engine? Probably a couple of decades back with the Class 60.
So thanks to General Electric and Freightliner for giving me something to get my technical teeth into. And the new Class 68 is a very interesting piece of kit indeed.
It looks to me like exactly what freight needs in today’s capacity constrained railway – more power and more tractive effort with lower fuel consumption than a Class 66. This means that it will be able to haul heavier trains to existing timings or existing trains to faster timings more economically.
Of course, the eventual solution is electric locomotives putting down a Megawatt per axle. But we have to get more wirers up first, so for the next 15 years or so the Class 68 could have a profitable life.
What makes the Class 68 especially interesting is the choice of power unit. Instead of using a proven engine from the GE range the company has gone for a diesel conversion of an Austrian gas fuelled engine used in power stations.
Coming on for 50 years of experience with traction diesels (well I did start very young) tells me that this is the high risk option. Traction is a uniquely demanding application for diesel engines.
What diesel engines like is a simple life, churning out constant power at constant speed, so that everything can settle down and work at its best. What they get in traction is steel wheel on steel rail shocks and binary driving, while living in a cramped engine room with barely adequate cooling.
Freightliner has been very brave in ordering 30 without the benefit of a demonstrator. Let’s hope it pays off.
Last month the column featured the Competition Commission’s preliminary Findings from its investigation of the ROSCOs. In general, the ROSCOs were doing a reasonable job: the real problem was the franchising structure.
This month we have DfT Rail’s response. And, quite simply, the Commission is told it has got it all wrong. How the Department runs its franchises is none of the Commission’s business and, anyway, the Commission clearly hadn’t been paying attention when DfT Rail explained where the excess profits were hidden.
Some worked examples are provided to show the Commission where it had got its sums wrong and, by the way, the ‘detriment’ is actually more than we first thought. On top of that, since, as the Commission points out, the market clearly isn’t working, DfT Rail would like to see rentals capped on new train orders as well as the ex-British Rail fleets.
So in addition to sending the omni-powerful Competition Commission away with a flea in its ear, the Government is alienating the people it will need to fund replacement or life extension of around 6,000 ex-BR EMUs and DMUs, plus the 1156 net additional vehicles, the new Thameslink fleet, ditto Crossrail. Oh dear.
Anyway, for the sake of completeness and a disbelieving chuckle I cover separately the various and convoluted mechanisms by which DfT Rail thinks rentals could be capped. And look out for the Independent Expert, a job right up my street if it ever happens.
And what do we make of the claim that the Net Present Value of the excess profits from the ex-BR fleet over their remaining asset life is £300-£1,100 million. Hang on, chaps, in that case why did DfT Rail sign up to renew all those exorbitant rentals when letting the three replacement franchises last November.?
As I surmised last month, the 42 vehicles for TransPennine Express in DfT Rail’s updated list of the 1300 additional vehicles in the Rolling Stock Plan was a transposition of 24. Subtract, too, the 126 vehicles for Thameslink, which crept into the updated Rolling Stock Plan when they were supposed to be separate, and the magic number is now 1156.
Yes, I know it’s silly to nit pick, but it helps highlight the chaos affecting the deadly serious issue of how many vehicles the manufactures should expect to build and the bankers fund. And people’s jobs hinge on that assessment.
Meanwhile some of my manufacturing chums think I’m an optimist. They reckon the likely number is nearer to 850 additional vehicles in Control Period 4 (2009-2014)
A sure sign that Autumn’s here is the opening Fourth Friday Club meeting of the new session. There was a lot to catch up with and we had an excellent, and frank, presentation by Andrew Haines of First Great Western.
The following week filled a lot of pages in my ever present notebook. On the Tuesday afternoon it was the Railway Forum’s Annual Conference. Against the background of banks collapsing, ORR Chairman Chris Bolt highlighted the vulnerability of franchises to an economic turn down. The Government’s Statement of funds Available (SoFA) depends on the financial contribution from the passenger to railway costs increasing from half to two thirds.
Next day I was up early for the flight from
And on the way back I cadged some time in the cockpit of the Chartered
Last week I had another couple of outings. First, a get to know you meeting with the new Chief Executive of ATOC, which generated a number of ideas, and on Thursday a morning with what I think still think of as Alstom Signals. That pretty well filled up the notebook.
Looking ahead, on the 30th the four horsemen of the Apocalypse lay waste to Network Rail, otherwise known as ORR’s announcement of its Final Determination. Unless ORR has backed down a lot the smart money is on Network Rail asking for a referral to the Competition Commission later in the year.
I won’t be at the ORR press conference because it’s time for my routine three yearly colonoscopy. Hmm, watching live colour television of your interior while mildly sedated or struggling with RABs and WACCs and viewfoils full of brain numbing tables? Much the same really.
Meanwhile in the first week in November there’s a conference on the vehicle track interface, the following week IRSE has a paper on Network Rail’s signalling strategy. On the 19th it’s the annual CILT conference on future challenges facing the railways and the month ends with the Golden Spanners Awards at the Fourth Friday Club on the 28th.
Must go, I’ve got some spanners to spray.
Roger