The True Value of Rail

Andrew Lezala, CEO Metro Trains Melbourne

New Zealand Rail Conference

June 2016

Melbourne Rail Network

“A railway is 10% iron”

• ‘Spider Network’ with central body, long legs

• 15 lines

• 218 railway stations

• 210 six-carriage trains

• 4,700+ employees

• 2,300+ weekday services

• 14,000+ weekly services

• 800,000+ daily journeys

• 800+ kms of track

• 227 million trips p.a.

The Spine Of Melbourne

▪ Melbourne is the fastest growing capital city in Australia

▪ Every week 1800 new residents come to live in our city

▪ South Morang is the fastest growing suburb in Australia

▪ 7 out 10 fastest growing regions are in Greater Melbourne

▪ Rail patronage has soared over the last decade

▪ The railway will do the heavy lifting into the future

Melbourne train patronage

Metropolitan Train PatronageMelbourne Train Patronage (millions trips/year)

230 million

trips per year

150 million

trips per year

Population growth in Melbourne

“A railway is 10% iron”

Melbourne train patronage - comparison

Metro Trains Melbourne | Oct 2015

Number of lines 15 16 10 11

Number of stations 218 300 85 270

Route length 392km 428km 175km 402km

Population 4.0 mil 11.8 mil 7.0 mil 7.5 mil

Daily ridership 0.4 mil 4.5 mil 3.9 mil 3.0 mil

Overall Ridership 10% 38% 56% 40%

% of city population

Melbourne Paris Hong Kong London

Rail Value…

Ecology – road carbon emissions million t

Road emissions 1990-2020Bureau of Infrastructure, Transport and Regional Economics

Ecology – transport emissions by mode

Rail vs other transport modesEconomics

Ecology

In one year, the average passenger train reduces carbon

emissions by a factor equivalent to planting 320 hectares of trees

In one year, the average freight train travelling between Melbourne and

Brisbane reduces carbon emissions by a factor equivalent to planting 600

hectares of trees (or a household of 3 people giving up electricity for 46 years)

* Deloitte Access Economics

Safety

▪ On average, every year there are 1500 road fatalities and

over 30,000 road injuries costing Australia $35 billion annually

▪ By comparison rail accrues 37 fatalities and 130 injuries

* Deloitte Access Economics

▪ One passenger train reduces accident costs by an amount that

could fund 505 hospital beds per day or 6 doctors for one year

Congestion

▪ Traffic congestion costs Australians $15 billion every year

▪ The average passenger train takes 525 cars off the road,

that’s equivalent to 3.2 million vehicle kilometres a year

▪ The average freight train takes 110 trucks off the road,

that’s equivalent to 49.7 million truck kilometres a year

* Deloitte Access Economics

Total domestic freight task by transport mode, billion tonne-kms

Congestion

Total passenger travel by transport mode, billion passenger-kms

Congestion

Estimated congestion cost in American cities

Congestion

Reducing social exclusion

Poor transport contributes to social exclusion in two ways:

1. Poor transport restricts access to activities that enhance people’s life

chances such as work, learning, health care, food shopping and more

2. Deprived communities suffer disproportionately from pedestrian deaths,

pollution and the isolation which can result from living near busy roads

* London Social Exclusion Unit

** Australian Bureau of Statistics

ABS figures suggest that 2.6 million Australians live under the poverty line,

meaning that 11.8% of residents are in need of low cost transport options

Social exclusion in Melbourne

Melbourne suburbs by growth

Facilitating growth and prosperity

▪ The CBDs of Sydney and Melbourne – just

7.1 square kilometres – generate $118 billion

(triple the contribution of the agriculture sector)

* Grattan Institute

** Australian National Accounts

Infrastructure is of critical importance to the

productivity of businesses – governments must

look for new ways to meet our infrastructure

needs over the long term – there is no shortage

of private sector financing available for projects.

John Fraser | Secretary to the Treasury

Facilitating growth and prosperity

64.7%

Sustainable industry – jobs and $$$

▪ The High Capacity Metro Trains (HCMT) Project is the largest single

investment in new rolling stock in Victorian history at 65 new trains

leading to 120 by 2025 (with 50% local content)

▪ Sydney and Melbourne alone will invest $55 billion in rail assets in

the next 10 years

▪ Inland Rail Project -1700km of new freight line, enabling goods

to be delivered Melbourne-Brisbane in less than 24 hours

Tens of thousands of jobs

Making it happen…

Planning and mobility demand

▪ There is a vital need for carefully developed urban blueprints

such as those developed for Shanghai and other major cities

▪ A national transport plan would provide cohesion and direction

▪ We must plan and build smart cities not dumb cities… why build

in Point Cook and Cranbourne without public transport infrastructure?

▪ Change to high rise close to CBD - or mobility demand becomes exponential

Funding… get joined-up plans

▪ Federal and State government alignment supporting the plans

▪ Private sector finance for appropriate elements

▪ Value capture – plan it in from the start

▪ Alternative sources of funds e.g. benefit tax, congestion charging etc

▪ ARA should play a key role in influencing outcomes in this space

Customer centric approach

A customer centric approach will help to drive rail patronage in the future:

Clean

Accessible

Reliable

Safe

Capacity

High capacity trains

“A railway is 10% iron”

High capacity signalling

Bus feeders into stations

Creating a smart metro

Build… build…build

Project delivery

There are major rail electrification projects underway in key cities:

Melbourne

Auckland

Wellington

Sydney

Sydney Metro Northwest

Sydney Metro Northwest

50 Level Crossing Removals

$5-6 billion 50 level crossings to be removed

over 2 full terms of government

A huge program of works with

estimated investment to be

approximately $5-6 billion

Cranbourne-Pakenham Rail Upgrade Project

$2.5 billion The Cranbourne-Pakenham Line

upgrade will deliver more services:

▪ 37 high-capacity trains

▪ 9 level crossing removals

▪ 4 stations to be rebuilt

▪ Power and signalling upgrades

▪ New train depot at Pakenham

▪ Line capacity boosted by 42%

▪ Extra 11,000 customers in AM peak

Melbourne Metro Rail Project

$11 billion The Melbourne Metro Rail Project

will double the size of the city loop:

▪ 2 x 9km rail tunnels running from

South Kensington to South Yarra

▪ New underground stations at Arden,

Parkville, CBD Nth, CBD Sth, Domain

▪ Train/tram interchanges to be built

at Parkville and Domain

Line Extension to Mernda

$600 million The South Morang line will be extended

to Mernda, catering for the significant

population growth in Melbourne’s north

Affordability . . .

Affordability

▪ Strive to reduce overheads and public transport subsidies

▪ Sensible pay deals – currently construction costs are prohibitive for many much-needed projects

▪ Better engineering standards, design and processes – lower cost by design

▪ Affordable high speed – ART

Air Rail Transit (ART)

▪ Ultra light construction

▪ Utilising existing road / rail corridors

▪ 360 km/h moving 9,600 customers/hour

▪ Cabin design based on the layout of a regional aircraft

Air Rail Transit (ART)

▪ TGV France & Spain $40 million/km (€ 5.97 million/km)

▪ Shinkansen $50 million/km (¥4.27 billion/km)

▪ Channel Tunnel Rail Link $358 million/km (£ 92.08 million/km)

Air Rail Transit (ART)zzzz

▪ Melbourne to Geelong = 16 mins

▪ Tullamarine to Avalon = 13 mins

▪ Melbourne to Sydney = 2 hrs 29 mins

True value of rail

▪ Ecology - a better world legacy

▪ Reduced transport related death and injury - $35 bn pa

▪ Reduced congestion - $15 bn pa

▪ Reduced social exclusion

▪ More growth and prosperity

▪ More jobs and $$$

▪ Planning and blueprints

▪ Aligned and multi-faceted funding models

▪ Integrated mobility

▪ Customer centric approach

▪ Affordability

Thank You