Recap: all the issues discussed by The Urbanist last month

Amsterdam

Density by itself does not necessarily create vibrant street life. Late Saturday morning in Borneo, inner city Amsterdam

Are infrastructure costs a lot higher in the outer suburbs?

It’s a truism that development costs are much higher on the urban fringe than in inner areas. But there’s little evidence the claim still holds and good reason to think it’s no longer the case

Managing excessive car use: what’s the low hanging fruit?

A study of urban form in the US concludes that increasing the density of population and employment is a slow way to significantly reduce car use compared to directly pricing driving

Should we be building new rail lines up in the air?

It would be a pity if the “Sky Rail” brouhaha in Melbourne over removal of level crossings were to damage the potential use of elevated rail for totally new rail lines in all Australian cities

Read the rest of this entry »


Is Avalon side-tracking Tullamarine rail?

Some famous faces spruiking Avalon Airport to Chinese investors

The Baillieu Government is determined to press on with its election commitment to start construction of the $250 million rail link to Avalon Airport in its first term. The Premier did this nice photo op last week waving-in planes at Avalon.

The Age reporter, Andrew Heasley, took a clever line, asking how the Government could commit to Avalon while spending just $6 million on a feasibility study for a rail line to Melbourne Airport. That produced this bizarre explanation from the State’s Aviation Minister, Gordon Rich-Phillips, who effectively said Avalon is going ahead because it’s easier:

There are challenges around an airport link for Melbourne ……Avalon is a clearer project than Melbourne in terms of the logistics associated with doing it. The reality is.…the lack of development around its [Avalon’s] immediate vicinity makes a lot of those logistics questions at Avalon easier than they are for Melbourne….. We have committed to work at Avalon and we’ve committed to feasibility at Melbourne. We don’t have a project for Melbourne [Airport], we have a feasibility study for Melbourne.

While I admire Mr Rich-Phillip’s unusual and possibly courageous frankness, I can’t see that ease matters more than need. Otherwise we’d build new schools where it’s cheapest rather than where the population is growing. Or the Government would be putting Protective Services Officers in retirement villages rather than on rail stations.

I won’t go into depth about what a silly idea the Avalon rail link is because I discussed it only a few weeks ago (Is the Avalon rail link Baillieu’s folly?). Suffice to say that Melbourne Airport is 22 km from the CBD, is the second busiest airport in the country, and has enormous scope for expansion; Avalon is 55 km away, has just six scheduled flights a day, and has enormous scope for expansion. Even if a rail line were built to Avalon, you’d have to wonder what the frequency, hours of operation and ongoing financial losses would be – it’s got to be sobering that Brisbane Airport’s train stops running at 8pm. I don’t have any problem with Avalon Airport per se, my worry is why taxpayers have to kick in when there are better uses our dollars could be put to.

This fascinating PR video produced to market Avalon to Chinese investors (see exhibit) shows what a cast of famous characters are backing Lindsay Fox’s Avalon venture, from the Prime Minister to the Lord Mayor. I know some gilding of the lily should be expected, but seriously Robert Doyle, how could you say “Avalon is the gateway to Melbourne” with a straight face? And as if, Lindsay Fox, travellers using Avalon could continue to get “on a plane in five minutes” if it really did grow to the size you imagine and hope it will?

What I didn’t know until I viewed the video is the Victorian Government, according to the Premier, has “committed to build a fuel pipeline for jets” to Avalon. This is all on the back of Avalon being “Melbourne’s second international airport”. As I’ve said before, it’s time we were given some explanation for what a second international airport actually means – is it something more than a place for motor racing teams and pop stars to land their cargos once a year? No one is going to seriously believe they’ll transport Ferraris to Albert Park or amplifiers to Rod Laver Arena by rail. What’s the logic behind it? We need a clear explanation – in terms of quantified benefits – of why governments are apparently prepared to spend hundreds of millions on infrastructure for Avalon.

Of course, construction of Avalon rail will have minimal practical effect on the need for a rail link to Melbourne Airport, although it could conceivably have a big effect on whether the Government feels obliged politically to proceed with the latter project. What they both have in common however is that no considered case has yet been made for either one. However The Age’s story – subsequently taken up as fact by these letter writers to the paper – implies that rail to Melbourne Airport is automatically a good idea. It’s certainly an infinitely better idea than rail to Avalon (what wouldn’t be?), but it’s by no means obvious that it’s needed now, as I’ve pointed out a number of times before (see Airports & Aviation in Categories list in the sidepane). Read the rest of this entry »


Will the price of jet fuel go stratospheric?

Comparison of air fares and HSR fares used in the patronage demand forecasting modelling (one-way). NOTE: The clue to understanding this graph is the blue curve is business fares and the grey one is non-business fares

Ultimately, the bottom line in discussions about the warrant for High Speed Rail (HSR) always seems to come down to proponents’ certainty that the price of jet fuel will go stratospheric.

HSR won’t save time, won’t reduce fares, won’t increase economic activity, won’t promote decentralisation and is an extraordinarily expensive way to reduce carbon emissions – but if at the end of the day the cost of jet fuel means flying becomes ridiculously expensive, then, the argument goes, HSR is the only way of filling the breach.

There are a number of points to consider about this sort of scenario.

One is that while fuel is a significant part of the cost of flying, it’s not the whole story. At present, fuel comprises around a third of airline operating expenses, up from about 15% ten years ago. So a doubling in fuel costs will have a big impact, but it isn’t going to double fares – that would require fuel to quadruple in price (and other costs to remain constant).

Airlines could respond to higher fuel prices by finding ways to reduce their consumption of jet fuel. Aviation expert Ben Sandilands reckons “by 2036….jet fuel is realistically predicted to be at least 50% derived from algal or biological fuel substitutes….”. Others like Robert Merkel are not as convinced of the prospects for biofuels on the scale required. There’re plenty of “out there” proposals for alternative fuels and technologies (e.g. here and here) but they all look pretty speculative.

I don’t think alternative fuels have much potential at this stage but there’re better prospects in using jet fuel more efficiently. Although commercial jet aircraft speeds haven’t increased a lot over the last 40 years, the Aviation Green Paper says modern aircraft are 70% more fuel-efficient than they were in the late 1960s.

The current average fuel consumption of the world’s jet aircraft fleet is around 5 litres per 100 Revenue Passenger Kilometres (RPK), but this will improve as larger, more modern aircraft come into service. For example, a fully laden A380 consumes 3 litres per RPK and the new Boeing Dreamliner is claimed to be even better. Of course this is a mature technology so it’s unlikely historical efficiency gains can be carried forward at the same rate.

However not all experts expect fuel prices to go sky high. The Federal Government’s new High Speed Rail Study – Phase One report assumes both air and HSR fares will reduce by three per cent in real terms by 2015 and remain constant thereafter. Road vehicle operating costs on the other hand are assumed to increase in real terms by eight per cent to 2036 and by a further four per cent to 2056. None of this suggests the apocalypse is nigh.

There’s very little in the report elaborating on these assumptions but it’s as well to remember that the peak oil hypothesis does not mean an immediate end to oil production. Rather, as John Quiggin says, it means a gradual decline over 100 years or more (international oil production has been stable for the last seven years). Read the rest of this entry »


How important are the regions for HSR?

HSR - passenger loadings 2036 (from High Speed Rail Study - Phase One Report)

The exhibit above is one of the ‘money’ graphs from the High Speed Rail study – Phase One report released on Thursday by the Minister for Transport, Anthony Albanese. In my last post, I concentrated on doing a broad but quick response to the report and questioned the wisdom of spending mega dollars on a project that doesn’t reduce either travel times or the cost of travel.

Now I want to start exploring some issues the report raises. One of those is that, up to this point, the focus of the HSR discussion has largely been around travel between major cities, especially Sydney-Canberra-Melbourne, with some residual claims for regional development (see Categories in the side pane for previous posts on HSR).

The Phase One report however shows regional trips are a very large component of the travel forecast on the complete Brisbane to Melbourne HSR network in 2036. In fact regional travellers – those who are journeying between regional areas and one of the major cities – comprise an extraordinary 75% of forecast demand in 2036 (see exhibit). These are the sorts of trips that are almost all currently made by car. A significant proportion are also “induced” trips – in the absence of HSR and the greater accessibility it provides, they wouldn’t otherwise be made.

Only a small proportion of regional trips are for business purposes. The vast majority – 85% – are for private or leisure purposes i.e. to visit friends or relatives, holidays, entertainment, sport, shopping, education, personal or health-related purposes. The study assumes leisure passengers will pay a lower fare than business travellers (who are concentrated on the inter-city services, e.g. Sydney-Melbourne, where they account for 50% of passengers).

Regional trips are also shorter on average (they comprise half of all HSR passenger kilometres), so the contribution of regional travellers to total revenue is much lower than their 75% share of patronage. Even so, as with airlines at present, their contribution is vital.

There are a number of issues raised by the high level of forecast regional patronage. One is that leisure travellers are sensitive to the cost of travel. The study assumes HSR fares are pitched a little lower than air fares, but if this assumption proves optimistic the demand for HSR could be much lower. Unfortunately there’s no estimate provided for regional travellers, but for inter-city travel the study says a 10% increase in fares will reduce patronage by 10%, and vice versa.

In estimating demand, the study compares the cost of travel by HSR between the regions and the major cities against the car, but doesn’t allow for the usefulness of having a car when travelling within the big smoke. HSR will certainly suit people going (say) from Seymour to the MCG – they can drive to their nearest HSR station (they’ll be about 100 km apart in the regions), disembark at Southern Cross and take a local train/tram combination to get to the G. If however they’re not going to the city centre – perhaps they’re attending a wedding, a party or staying overnight with one of the 90% of the population who lives more than 5 km from the CBD – they might prefer the convenience of having a car for travel within Melbourne.

The car will be a more attractive option the closer regional residents live to the city, although anyone familiar with Canberra will know of the large numbers of young people who commonly drive to Sydney on weekends. Another thing to note is car occupancy for leisure travel is much higher than it is for commuting (where solo driving predominates). Two people travelling (say) to Sydney from Gosford for a concert would pay $26 each per one-way trip on HSR i.e. a combined total of $104 to get to and from Central station. Once the novelty of HSR has subsided, driving could be a more attractive alternative for many.

The big issue to my mind though is just why we as a society would want to spend so much money to improve the leisure travel options of regional populations living along Australia’s east coast. Doubtless they deserve it and would appreciate it, but they already have pretty reasonable travel choices. Last time I drove the Hume Highway from Sydney to Melbourne (about five years ago) it was divided carriageway practically all the way. Large centres like Wagga Wagga and Albury-Wodonga have pretty good air connections to Sydney and Melbourne. There’s already (an admittedly slowish) train service connecting Brisbane, Sydney and Melbourne. Read the rest of this entry »


What does the new HSR feasibility study say?

HSR short-listed station sites, Melbourne (DIT/AECOM)

I’ve had an admittedly rushed look at the Executive Summary of the High Speed Rail Study – Phase One, released today by the Minister for Infrastructure and Transport, Anthony Albanese. I’ll have a closer look at the full report shortly, but for now here are a few initial thoughts.

Today’s report is Phase One. It looks at infrastructure costs and forecast patronage. The really important bit – the analysis of the benefits and costs and how the project might be financed – must wait for completion of Phase Two. So for the moment difficult questions like “is HSR a good idea?” are side-stepped.

This study was done partly because The Greens and Independents required it be done. But given how popular the idea of HSR is, it could be up there with the NBN as one of the Government’s smarter moves politically. One way or another the Government’s going to support it and find a way to make it look plausible. After all, it reeks of ‘vision’ and no significant outlays will probably be required for at least two terms. But the risk is it won’t be examined seriously.

Mr Albanese is certainly talking up HSR. He is quoted as saying high-speed rail would be an “attractive alternative” for many, particularly those fed up with airport scanners introduced after the 9/11 attacks. It’s a pity he didn’t see recent reports of Al Qaeda’s interest in trains or recall the Madrid train bombing.

As is now seemingly obligatory, Mr Albanese also cites the success of the AVE system in Spain in support of HSR. ”In Spain, the line between Madrid and Seville is so popular, it carries more people between those cities than cars and airplanes combined”, he says. I’ve pointed out before that AVE is a questionable analogy, at least for routes like Sydney-Melbourne  and Sydney-Brisbane – Madrid has a population of 6.5 million and is only 391 km from Sevilla.

The report says the estimated cost for the most likely route between Brisbane and Melbourne is a cool $108 billion – and there’s a 10% chance it could be higher (ignore the lower $61 billion figure published in the media as there’s a 90% chance it’s too low). These estimates don’t include planning and procurement costs – so add another 15% – and nor do they include the cost of buying and operating the rolling stock.

The estimated cost for the Sydney-Canberra-Melbourne leg is a whopping $45-$50 billion, depending on whether it goes via Wollongong. And of course, add procurement and operating costs.

The study is upfront in making it clear the capital cost can’t be recovered from revenue. International experience, it says, “suggests it is unrealistic to expect the capital cost of a HSR network to be recovered”. Of course that’s par for the course with public transport, but in this case we already have a competitive airline system transporting the public between Brisbane, Sydney, Canberra and Melbourne. So the cost to the taxpayer of replacing one form of public transport with another is no idle matter.

One reason the capital cost is so high is because the investigators have concluded an HSR network is only sensible if it provides for speeds as fast as 350 km/hr in non-urban areas and 200 km/hr within cities. They have assumed a dedicated two track right of way, with tunnels from the urban periphery to the CBD in Sydney, Melbourne and Brisbane.

Based on these speeds, they estimate the travel time between Sydney and Melbourne CBDs at around three hours, making it competitive with air for city centre workers. That seems ambitious – I’ve noted before the maximum permitted speed of Spain’s new AVE system is 300 km/hr. China’s extensive HSR system is also limited to a maximum speed of 300 km/hr for reasons of safety.

Although other candidates are being considered, the most likely city centre station in Sydney is Central and in Melbourne Southern Cross (the alternative is North Melbourne). Suburban stations are also being examined e.g. Parramatta. Stations deep underground are ruled out, so it could be a challenge to accommodate new works in the CBD.

It will come as a surprise to many that HSR is not capable of serving either Sydney or Melbourne airports due to differing operational requirements. It’s possible however than a Melbourne Airport train and HSR could share the same infrastructure, e.g. own tracks but same tunnel. One of the most interesting aspects of the report is that a second Sydney Airport doesn’t appear to even be mentioned. Regional stations are assumed to be located at approx 70-100 km intervals. Read the rest of this entry »


Do Tiger Airway’s woes mean we need HSR?

Alta Velocidad Española (AVE) High Speed Rail network, Spain

I guess it was only a matter of time before someone would see Tiger Airway’s current troubles as evidence Australia needs High Speed Rail (HSR) between Sydney and Melbourne.

That someone is a Mr Peter Appleton of Brown Hill, who wrote to The Age saying “with the halt of flights, we are back to Third World trains service – Sydney to Melbourne, 800 kilometres in 11 hours. French, German, Japanese and Chinese trains would cover the same distance in 2½ hours”.

It’s evidently escaped Mr Appleton’s attention that there are three other airlines still flying between Sydney and Melbourne – Qantas, Virgin Australia and Jetstar. Mr Appleton doesn’t need to use the train. It’s puzzling why The Age even published this letter given there’s no logical connection between Tiger Airways current troubles and the “Third World” train service between the two cities.

Indeed, another interpretation is that Tiger’s troubles are evidence of effective competition in domestic aviation, leading to lower prices for consumers. Tiger’s particular mix of price and service evidently isn’t proving attractive to enough travellers (big surprise!), but even if the company withdraws permanently from the market, we still have three operators. History suggests the possibility of another entrant to the market can’t be discounted.

Of course three operators isn’t as good as four (and Qantas and Jetstar are related), but any High Speed Rail service on the Sydney-Canberra-Melbourne route would almost certainly be provided by a single (i.e. monopoly) operator, as is the case elsewhere.

The first stage of the Federal Government’s HSR study is due this month so there are likely to be more tall stories as the lobbying intensifies. The Age ran what was in effect an advertorial on June 24 for French electricity and transport company Alstom. Just what disinterested contribution the paper expected would be provided by a company that claims to have built 650 high speed trains over the last four decades is anyone’s guess.

The Age was happy to run with the line of Alstom’s Australian chief executive, Chris Raine, that “events such as the volcanic ash cloud from Chile (have) made it all too clear Australia could not rely on aviation alone to meet its transport needs”. Unless Mr Raine has evidence that global warming is somehow leading to more volcanic eruptions, he should acknowledge that the number of flying hours lost to volcanoes in Australian aviation history is miniscule. This reminds me of those who imply earthquakes are caused by global warming! Read the rest of this entry »


Would we build another Opera House?

The other 'Melbourne Opera House' - Powlett St East Melbourne

An argument I see frequently in relation to massive infrastructure projects like High Speed Rail (HSR) is that we should simply get on and build them because they’re ‘visionary’ and ‘nation building’. For example, a commenter recently likened investment in HSR to the decision to build the Sydney Opera House. If cost-benefit analysis had been done on the Opera House, he argued, it would’ve been still-born. Thus we would’ve been denied the enormous tourism revenue and the boost to national pride provided by this magnificent building.

I expect he’s right. Formal cost-benefit analysis would probably be hard-pressed finding that the benefits of any opera house exceed the costs, either then or now. There’s therefore always a chance if you look too hard at the costs and the risks you could end up missing out on some whopping future benefits. However the problem with this sort of argument is that it’s based on hindsight. We know for a fact from the perspective of 2011 that the Opera House is a grand success. But cost-benefit analysis isn’t retrospective, it’s prospective – it helps us to evaluate projects before we commit to building them.

Here’s a “thought experiment”. Consider a contemporary proposal to spend a fantastic sum of money on (say) The Melbourne Opera House (insert your city of choice). Imagine an architect of Frank Gehry’s stature (but please not Frank himself!) was asked to ignore the cost and come up with a design that would create an “international icon”. The promise is the building would “put Melbourne on the map” and more than repay the preposterous cost over the years in tourism revenue and civic pride. Of course while it would nominally function as an opera house, what we’d really be building is a piece of architecture so powerful, distinctive and attractive, that it would be as iconic as……well, the Sydney Opera House.

The trouble is the probability of achieving this vision is close to zero. No one knows what the recipe for international icons is. We can look back and more or less pick out the vital decisions and factors that made the Sydney Opera House the symbol it is today, but doing it prospectively is close to impossible. We’d almost certainly end up with a Melbourne Opera House that was functionally compromised and cost billions more than it needed to, but which nobody outside Victoria gave a second glance.

Actually even if the Sydney Opera House planners knew with certainty in the late 1950s what we know now, I’m not sure building it would’ve been the “right” decision to take at the time. The Sydney Opera House didn’t instantly become an international symbol so most of the tourism and “icon” benefits, which probably didn’t kick in seriously until at least the 1980s, would’ve been heavily discounted back to the time the decision was taken to proceed. The net present value of the benefits might not have exceeded the cost of construction which, let’s not forget, was very high. Read the rest of this entry »


– Are we too smart for High Speed Rail?

HOW TO DO CITY BRANDING......

Fairfax’s on-line publication, The National Times, posted a feature on High Speed Rail (HSR) on the weekend under the heading, Is Australia too big for a high-speed rail network? The paper gives space to four viewpoints: Peter Moore and Stephen Byron are unashamed HSR boosters, Gary Johns is sceptical and Saul Eslake sits on the fence.

I’ve written about HSR before (see the Categories list in the side pane) and, with the Federal Government’s feasibility study due shortly, it’s timely to take a look at the issue of a Sydney-Melbourne HSR service again.

As usual, all sorts of benefits are claimed for HSR, such as greater comfort, quicker check-in times and the ability to use laptops and mobile phones in-journey. Saul Eslake brings a new perspective — he reckons the conventional wisdom that HSR only works over short to medium distances is outdated. He cites the Barcelona-Madrid-Sevilla AVE system which runs over 900 km, considerably further than the 700 km airline distance between Sydney and Melbourne.

As I’ve pointed out before, most of these sorts of claims are exaggerated or misapply foreign examples — and Saul Eslake’s argument is no exception. Spain’s AVE system is in effect two medium-distance services, not one long one.

The airline distance between Barcelona and Madrid is 506 km and thence from Madrid to Sevilla is 391 km. The population of metropolitan Barcelona is 4.2 million and Sevilla 1.5 million. But most importantly, Madrid is in between these two and has a population of 5.8 million. The prospects for HSR in the Sydney-Melbourne corridor would be a lot more attractive if Canberra or Albury/Wodonga were the same size as Madrid!

But these sorts of arguments are beside the point. Notwithstanding all the claimed advantages and suitabilities of HSR, travellers in the Sydney-Melbourne corridor are simply not prepared to pay enough to make HSR viable – or even remotely competitive with air – without a subsidy. This is not unusual in the world of fast trains as the great majority of HSR systems throughout the world operate with public assistance.

That might make sense in some countries where there isn’t an alternative form of public transport for inter-city travel, or if HSR provides a significant advantage in travel time. However the key to understanding the relevance of HSR in Australia is recognising that we already have an efficient and competitive airline industry providing transport for people and high value freight between Sydney and Melbourne. This is an industry that provides a fast service and pays its (financial) way.

HSR, on the other hand, is unthinkable in this corridor without government assistance to meet revenue shortfalls and to compulsorily acquire land and obtain various planning and environmental approvals. Nor does it offer a significant time saving over air. That’s why the market hasn’t just gone ahead and built a very fast train.

There have to be very, very good reasons why taxpayers should be called on to help replace a highly competitive industry with one that (a) would require a significant financial and in-kind subsidy, and (b) would very probably be run by a monopoly operator. There would also have to be good reasons to replace one form of public transport with another – and for promoting it to the top of the transport infrastructure priority list.

Putting aside political convenience, the only rational basis for subsidising HSR between Sydney and Melbourne would be to deal with the unpaid external costs of air travel.  Public funding might be justified if the benefits of HSR in terms of factors like reduced carbon emissions, noise and traffic congestion, exceed the cost of the subsidy. Read the rest of this entry »


Is the proposed airport train off the rails?

Royal wedding preview

The idea of a high-speed Melbourne Airport-to-CBD rail line is in the news yet again, this time advocated by the RACV.

You’ve got to give the Royal Automobile Club of Victoria its due. While simultaneously calling for roadworks to reduce congestion and improvements to traffic flow in Hoddle Street, it’s morphing into a general transport lobby group that “advocates improved transport services for all its members, including those who use public transport”.

This story on the RACV’s call for an airport train has attracted over 100 comments, most of them favouring a rail line. There’re the same themes that come up every time The Age runs pro-airport rail stories – it’s embarrassing that Melbourne doesn’t have a dedicated rail line; car parking prices at the airport are extortionary; Skybus fares cost an arm and a leg; the contract with Citylink won’t allow competition; and the airport and taxi industry won’t let anyone kill their golden goose.

Even while they approvingly cite the example of Sydney’s and Brisbane’s airport trains, commenters nevertheless generally assume an airport train would be high speed, would solve congestion on Melbourne’s freeways and would cost no more than a Zone 1-2 fare.

I’ve explained before why an airport rail line is unlikely to make sense for a while yet, but it’s a good idea to take another more considered view of its prospects than those advanced by unabashed boosters. Here’re twelve reasons why a rail line to Melbourne Airport is unlikely to make sense for a while yet.

First, Skybus already provides a dedicated public transport service from the airport to the CBD with higher frequencies and longer span of hours than any train service in Melbourne. Most times trips to Southern Cross station take 20 minutes. While they blow out to over 40 minutes in peak hour, that could be addressed for a fraction of the cost of a new rail line by extending the existing dedicated on-road lane to other sections of the route that are prone to congestion.

Second, there’s little to be gained from spending more than a billion dollars to replace a high quality public transport service (Skybus) with another one (train), when the money could be spent on providing better public transport to areas that don’t currently have adequate service.

Third, every study undertaken to date has concluded that a rail service isn’t warranted. It might be in the future but not yet. In the meantime, there is considerable potential to increase the capacity and speed of Skybus. As pointed out here, Brisbane’s south-east busway already carries 15,000 passengers per hour. Read the rest of this entry »


HSR feasibility study: what should it address?

What is the What?!!! Wau, Southern Sudan

There’s a long history of rent-seeking in Australia over major projects. Business puts a lot of effort into lobbying government and the media to subsidise projects the private sector wouldn’t otherwise touch with a bargepole.

So when IPA (Infrastructure Partnerships Australia) – the nation’s peak infrastructure lobby group – releases a new study calling for land to be reserved for a High Speed Rail (HSR) service from Brisbane to Melbourne, I don’t immediately assume it’s an impartial assessment.

However that didn’t bother The Age, which ran the story as the lead on the front page of Saturday’s issue. The paper reports that AECOM, who prepared the study jointly with IPA, was involved in France’s TGV and Britain’s HS2 HSR projects.

The Chairman of IPA, Mark Birrell, is also on the board of Infrastructure Australia, the body established under legislation to advise the Federal Minister on infrastructure needs and priorities.

No, rather than assume the report is impartial, I thank the angel of small mercies that the only promise on the table from the Greens and Labor is for a $20 million feasibility study of HSR. There may be a thousand more welfare-enhancing ways that $20 million could be spent, but it will well and truly have earned its keep if it leads to the right decision on what could be a $40 – $80 billion investment in HSR.

I’m not going to reiterate the many and varied problems I see with HSR, since I’ve covered them before (see here, here, and here, ). What I do want to address however is the way the planned feasibility study will be conducted. Read the rest of this entry »


Is being “visionary” sufficient to justify new infrastructure?

All the talk around at the moment about ‘visionary’ infrastructure projects like High Speed Rail (HSR), the National Broadband Network (NBN) and a rail link to Melbourne Airport, reminds me how much Australians love to gamble.

Big and costly projects that don’t stack up on conventional evaluation criteria are often justified as being in the ‘national interest’; or the result of ‘big thinking’; or comprehensible in the “big picture’; or contributing to ‘nation building’.

Proponents frequently resort to the Field of Dreams argument: “if it’s built, they will come”*. Some cite ambitious projects like the Snowy Mountains Scheme, the Ord River Scheme and the Sydney Opera House, contending that they would not have been built if it weren’t for some big thinking. However they conveniently omit to mention the downsides of these projects, or any ‘visionary’ schemes that are widely thought to be disappointments (let alone any that were unmitigated disasters).

More informed proponents will focus on the foresight of previous generations who built infrastructure like the national and urban rail systems, water supply and sewerage systems and the electricity generation and distribution networks. Some even mention the elaborate freeways within and between our major cities.

The argument is commonly put that if the visionary politicians, engineers and financiers of a century and more ago hadn’t looked beyond economic and financial criteria at the time, much of the infrastructure we value today would not be available for the use of current generations. And we are very fortunate they did, so this line of argument goes, because it would be impossibly expensive to provide infrastructure on that scale today.

That’s all very well, but I don’t think this interpretation tells the whole story. Read the rest of this entry »


Does Labor’s Sydney-Newcastle High Speed train make sense?

The car-eating "straddle" train

I watched Anthony Albanese foreshadow on Lateline on Wednesday night that the Government, if re-elected, would fund a $20 million feasibility study of a high speed rail connection between Sydney and Newcastle as part of a Sydney-Brisbane route.

The Minister’s subseqent announcement on Thursday puts more emphasis on an east coast Brisbane-Sydney-Melbourne HSR but it seems clear the Central Coast is a key target of the initiative (Robertson is a marginal seat).

The announcement was greeted with some scepticism – an HSR link between Sydney and Newcastle was announced by Bob Carr twelve years ago. Crikey’s Canberra correspondent, Bernard Keane, reckons Labor isn’t serious about HSR and is only pretending.

Provided the focus is on Sydney-Newcastle, I think there are some reasonable aspects to this initiative notwithstanding its apparent political motivation. Read the rest of this entry »


What will high speed rail do for regional development?

Albury-Wodonga

Yesterday I looked at the carbon reduction justification for high speed rail between Sydney and Melbourne. Today I want to discuss another argument – that high speed rail will promote the development of regional centres. It is argued that this could in turn relieve capital cities of much of the burden of projected population growth.

I have no doubt that improving connection times between regional centres like Albury-Wodonga and Melbourne will benefit both.

But if regional centres are to be a serious alternative for growth, they will need to provide new arrivals with jobs. The question I ask is: where are those jobs going to come from?

One way could be that regional centres provide a “dormitory” for workers who can live in the country but commute to work in capital cities like Melbourne by high speed rail. Read the rest of this entry »


High speed rail – are the Greens as shallow as the rest?

Bob Brown let us know yesterday with his call for a high speed rail link from Brisbane to Melbourne that the Greens are just as susceptible to populism as Julia Gillard and Tony Abbott.

In April he costed a Sydney-Canberra-Melbourne link at more than $40 billion. Yesterday he pointed to a survey commissioned by the Greens showing 74% of Australians support high speed rail. That’s not surprising because it is an attractive and beguiling idea – 94% of readers of The Age support it. After all, China and Europe can’t seem to build enough high speed rail and President Obama has grand plans for an extensive network in the US.

The idea of some form of very fast train service connecting Sydney-Canberra-Melbourne has been around at least since the 1980s. A number of feasibility studies have been undertaken, all of which concluded that it wouldn’t be feasible without massive Government assistance. So it’s worth asking a few questions:

  • why would we want to commit billions in Government subsidies to replace one form of public transport (planes) with another (trains)?
  • why would we want to replace the four airlines that currently compete vigorously on price and service on this route with a single monopoly rail operator? Read the rest of this entry »

Forecasting patronage: it’s easy, isn’t it?

We’ve seen some high profile examples in recent years of how hard it is to forecast patronage on new transport infrastructure.

The Cross City tunnel in Sydney and the Clem 7 in Brisbane, for example, have both performed well below forecasts. Even when it was free, the Cross City tunnel did not approach the forecast volumes of 90,000 vehicles per day. Traffic volumes on the cross-river tunnel in Brisbane fell from almost 60,000 during the free period to around 20,000 in the first week of tolling.

Click to enlarge interactive map

California’s planned $42 billion High Speed Rail (HSR) project provides another example of the difficulties of forecasting demand. Although there are important differences between the design of the California HSR system and proposals for a Very Fast Train (VFT) between Sydney-Canberra-Melbourne, the former nevertheless has important lessons for us. I have previously discussed the VFT here, here, here and here.

A new analysis by the Institute of Transportation Studies, University of California Berkeley, found significant problems with the demand modelling and analysis undertaken for the California project by Cambridge Systematics (CS) “that render the key demand forecasting models unreliable for policy analysis”. Read the rest of this entry »


The VFT and Green’s preferences

This blog has devoted a fair bit of attention to the proposed Very Fast Train between Sydney-Canberra-Melbourne (here, here and here), wondering what warrant there is to replace one form of public transport with another.

More attention in fact than any of the mainstream papers or denizens of the blogosphere have mustered, as far as I can tell.

So readers might be interested in this article by Gary Johns published in The Australian last week. It’s notable because he conjectures that the VFT might be the price the Government has to pay to secure Green preferences in this year’s Federal election.

Don’t think I agree with his analysis of the Greens mind (this is the former Special Minister of State in the Keating Government, isn’t it?) but I think his sources on the economics of the VFT are impeccable. Here nevertheless is a less-than-complimentary take on Johns. Read the rest of this entry »


Has the very fast train run out of steam?

The idea of very fast trains on the Sydney-Canberra-Melbourne corridor seems to have run out of steam after an initial flurry earlier this year when the CRC for Rail Innovation and the Greens both called on the Federal Government to fund a major concept study.

There has been very little in the popular media since that opening blast. Hence it was interesting to see author, educator and consultant, John Legge, arguing in The Age on Saturday that the figures on very fast rail add up.

Note the extensive green areas near Canberra

He asserts that: (a) high speed rail works in Europe, China and Japan, (b) the US is now building high speed rail projects, (c) rail is faster, more comfortable and more convenient than flying, and (d) it can be built for a mere $15 billion. Ergo, it will be an unqualified success on the Sydney-Canberra-Melbourne corridor. But he provides little in the way of evidence or argument to support these claims.

Surprisingly, Legge makes no mention of what I think is the best argument for the project – constraints on Sydney Airport’s ability to expand capacity. Even more surprisingly, he doesn’t mention the environmental benefits of rail over air until the very last line and then just in passing. His key argument is that rail would out-compete air simply because a very fast train is a more attractive product.

I don’t want to deal with everything Legge says because I’ve covered most of the arguments for and against high speed rail here and here. But I do want to take issue with a couple of the points he makes.

First, what works in other countries won’t necessarily work in Australia. Most of the routes in Europe and Japan where high speed rail is strong are relatively short e.g. London-Paris is 340 km; London-Brussels is 198 km. London, with a population of 8 million and Paris (10 million) are very big cities compared to Sydney and Melbourne. They are world cities that have huge numbers of business travellers and tourists compared to Australia (London is an ‘Alpha’ world city). Congestion in the air and on the ground makes air less competitive in those cities, particularly for short trips. Read the rest of this entry »


Do the numbers support the Very Fast Train?

I’ve run some numbers on how a Very Fast Train in the Sydney-Melbourne corridor would stack up against planes in order to flesh out the questions I posed last week (Is the VFT all huff and no puff?).  I used a simple “back of the envelope” methodology adapted from that used by Harvard’s Edward Glaeser to evaluate high speed rail projects in the US (here).

I estimate the economic and environmental benefits of carrying all current Sydney-Melbourne air traffic by VFT rather than plane at around $840 million p.a. (although this does not include the cost of GHG emissions from construction of a rail line  – this would be large).

Table by Booz Allen

At first glance a VFT looks unpromising, since I estimate the capital cost of constructing and maintaining a VFT line from Sydney to Melbourne at about $1.5 billion per year. This is well in excess of the benefits.

However this assumes Sydney can accommodate passenger growth by using larger planes. It quite possibly can, but if it can’t and a second Sydney airport has to be built, a VFT starts to look viable if the cost of the airport were to come in at around $15 billion.

Let me emphasise that this is a simple analysis. I’ve left out many complications, including Canberra passengers and car traffic on the Hume.

The only environmental issue I’ve included is (operating) GHG. And of course I’ve made assumptions on things like construction costs and future interest rates.

Starting with capital costs, estimates of the cost to acquire land and construct a VFT line range from $14 to $82 million per km in Europe and the US (Japan is much higher because of earthquake risks). I assume a middling cost of $30 million per km, giving a total cost of $27 billion to build a 900 km line (the existing Sydney-Melbourne rail line is 950 km). I’ve assumed an interest rate of 5% p.a. and annual track maintenance cost of $124,000 per km. These assumptions give a total capital cost for the line of $1.5 billion per annum. Read the rest of this entry »