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23rd February 2018

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Kiwi Rail

KiwiRail shakes off impact of Kaikoura earthquake to post improved earnings

Kiwirail posted half-year revenue of $292.7m, down 1.9 per cent down on the previous year.
Kiwirail posted half-year revenue of $292.7m, down 1.9 per cent down on the previous year.

Disruption to South Island rail services caused by the November 2016 Kaikoura earthquake masked a continuation in improved operating earnings from state-owned railway operator KiwiRail in the six months to December 31.

The company reported an operating surplus of $15 million for the period, which would have come in at $40m once the one-off costs associated with the closure of the main trunk line between Picton and Christchurch were stripped out.

While quake impacts would still be felt in the second half of the current financial year, KiwiRail was still on track to deliver operating earnings of between $30m and $50m, said chief executive Peter Reidy.

In the previous comparable period, which included the first few weeks of the outage caused by the massive Kaikoura quake, KiwiRail reported operating earnings of $11m, or $23m underlying once quake impacts were backed out.

As always, the national rail carrier did not report a statutory profit on its activities, reporting a $193m loss for the half-year.

That reflects the fact that revenue earned “above rail” is always far lower than would be required to fully maintain the capital-intensive network.

However, the importance of maintaining a rail network for wider economic and national interest reasons means both the previous and present government accept KiwiRail will always make accounting losses.

The result for the half-year was achieved on revenue of $292.7m, 1.9 per cent down from the $298.3m recorded in the last six months of 2016, and reflecting the fact that the Kaikoura link was only restored in September 2017.

Operating expenses, at $277.4m, were 3.5 per cent lower than in the previous comparable period.

Ports revenue from KiwiRail’s trucking and rail services was up 16 per cent on the half-year, which chairman Trevor Janes said was a “strong result” when placed against overall container volume growth of 7 per cent nationally in the same period.

Forestry revenues rose 8 per cent as the so-called ‘wall of wood’ from maturing plantation forests starts to come on-stream.

Dairy industry and coal volumes rose, contributing to a 6 per cent increase in bulk freight revenue.

Poor weather and “significant and unexpected” repair costs on the company’s ageing South Island locomotive fleet contributed to a “messy” six months, Janes said.

KiwiRail was “working closely with the government on the urgent need for longer-term funding for the organisation, which is critical for efficient procurement, planning and safety”.

The Interislander ferries showed a 12 per cent increase in commercial vehicle ‘lane metres’ as more freight had to travel by road while the rail outage persisted, while passenger revenue rose 7 per cent and yields on vehicle crossings improved.

Reidy said KiwiRail was targeting operating savings of $7m this year, building on $45m of productivity improvements in the last two years.

Announcements relating to the revival of some mothballed regional rail services are expected when the government unveils detail of its $1 billion a year regional economic development fund, in Gisborne, on Friday.

Is it time for a Cook Strait bridge or tunnel?

The Cook Strait is a violent body of water. It’s an exception. Unlike other straits around the world, it has opposite tidal flows at either end. When it’s high-tide on the Tasman side, it’s roughly low-tide on the Pacific side and vice versa

Before the end of the last Ice Age, you might have been able to walk between the two islands – if there had been anyone around to do it. But for the last 20,000 years this strait has divided New Zealand in a way most countries have never known.

What if the country could become physically connected again? Is a Cook Strait bridge or tunnel pure fantasy?

What if the country could become physically connected again? Is a Cook Strait bridge or tunnel pure fantasy? Julian Lee ...

ROBERT KITCHIN/STUFF
There would be far more to gain than just the novelty of being able to take a 27 hour 2,000 kilometre drive from Cape Reinga to Bluff: an immense increase in traffic between the two islands, the untold billions saved in shipping and flying costs, the Marlborough and Wellington areas thriving and booming from increased commerce, the tourist dollars, the sheer convenience of replacing a three-hour ferry ride (and its associated on- and off-loading times) with a short drive.

It’s an idea that’s so outrageous even some of our more seasoned politicians have never heard it being raised before.

But Stuff pitched the idea to Transport Minister Phil Twyford.

Transport Minister Phil Twyford suggested a tunnel would be ruled out by the Alpine Fault and a bridge by the strait's ...

BRADEN FASTIER/STUFF
Transport Minister Phil Twyford suggested a tunnel would be ruled out by the Alpine Fault and a bridge by the strait’s rough waters.
 “This is the first time I’ve heard the idea. I know there is a successful tunnel between the United Kingdom and France, but I would have thought our faultline would rule out a tunnel. It is also a very rough stretch of water, and I’m no engineer, but I suspect that would rule out a bridge,” he said.

Judith Collins, who has National’s transport portfolio, was impressed by the idea, but pointed out an obvious flaw.

“Wow, this is a hugely ambitious and audacious idea. Where would be the fun of a Cook Strait pie in the middle of a howling gale though?” she said.

The idea of having a bridge or a tunnel between Wellington, pictured, and the South Island was raised seriously just ...

ROBERT KITCHIN/STUFF
The idea of having a bridge or a tunnel between Wellington, pictured, and the South Island was raised seriously just once by Premier Richard Seddon in 1904.

It seems to have been seriously raised only once by a New Zealand politician. A long time ago.

Hawke’s Bay Herald article from 1904 said that Premier Richard “King Dick” Seddon had been travelling all over the country bragging about how much money the Government had for grandiose projects, including a tunnel through the Cook Strait .

The unnamed reporter at the time felt it was inappropriate given the large loans New Zealand had taken from London. With a tongue-in-cheek, the reporter said that if Seddon told the public about the reality of the Government’s financial position, they might agree to his tunnel plan some time in the future.

One of the possible routes for a Cook Strait bridge or tunnel: Cape Terawhiti to the peninsula east of Picton, the ...

JULIAN LEE/GOOGLE MAPS
One of the possible routes for a Cook Strait bridge or tunnel: Cape Terawhiti to the peninsula east of Picton, the shortest route between the mainland and the North Island, 27km.
 These days something like 1.1 million people and 350,000 vehicles cross the strait every year with the two ferry companies, Interislander and Bluebridge. Should there be a drive option, many more would be guaranteed to use it – those who would normally fly or not take the trip at all.

With a bridge or tunnel, the prohibitively expensive and time-consuming trip from somewhere like Palmerston North to somewhere like Nelson becomes a drive that could be done in less than five hours.

Ask someone in the know and they will quickly explain that it is a pipe dream.

University of Canterbury structural engineering and materials professor Alessandro Palermo suggests that a "submerged ...

DUNCAN SHAW-BROWN
University of Canterbury structural engineering and materials professor Alessandro Palermo suggests that a “submerged floating tunnel” could be a better option for the strait.
 “I think given the geometry and the morphologies of the strait, a conventional bridge is not possible. The water is extremely deep and the cost will be prohibitive. Tunnelling will also be very expensive.”

That’s from University of Canterbury structural engineering and materials professor Alessandro Palermo – one of New Zealand’s top bridge specialists.

Palermo does have a proposal, but before that, what are we dealing with here? And most importantly, how much would these projects cost?

The Bluebridge and Interislander ferries, seen here in Picton, both take about three hours to cross the often violent ...

STUFF
The Bluebridge and Interislander ferries, seen here in Picton, both take about three hours to cross the often violent stretch of water.
 It is tempting to look at the strait’s narrowest point of just 22km for a potential crossing from Cape Terawhiti to Arapaoa Island in the Marlborough Sounds. That, however, means building a state-highway tier road through the extremely hilly country behind Karori all the way to the coast, another such road across undeveloped Arapaoa Island in the sounds, a bridge across the Tory Channel and another road to get back to State Highway 1.

A 27km bridge or tunnel from the cape directly to the mainland and bypassing Arapaoa, landing on the peninsula east of Picton, would still involve significant roadworks.

If, on the other hand, you wanted to build a link between the two closest developed points (Wellington city and either Picton or Blenheim), the distance is 64km to Picton and 65km to the shoreline just east of Blenheim.

The 2.4km Waterview Tunnel in Auckland, pictured, cost $1.4b, which equates to about $583m per kilometre. For a 27km ...

CALLUM MCGILLIVRAY/STUFF
The 2.4km Waterview Tunnel in Auckland, pictured, cost $1.4b, which equates to about $583m per kilometre. For a 27km tunnel, that’s $15.7b. For a 65km tunnel, that’s $37.9b.
 BRIDGE OR TUNNEL?

Bridges are much cheaper than tunnels. The catch? A bridge would have to withstand a highly turbulent Cook Strait, probable earthquakes and be high enough for ships to get through (or at least able to open up).

A 65km-odd bridge would be New Zealand’s biggest bridge by far. The current longest bridge is Canterbury’s Rakaia Bridge at just 1.8km.

One of the possible routes for a Cook Strait bridge or tunnel: Cape Terawhiti to Arapaoa Island, the shortest point ...

JULIAN LEE/GOOGLE MAPS
One of the possible routes for a Cook Strait bridge or tunnel: Cape Terawhiti to Arapaoa Island, the shortest point between the two islands, 22km.
 It’s so long, in fact, that if it existed it would be the sixth-longest bridge in the world.

But the cost of a bridge is not impossible for New Zealand.

The 38km Lake Pontchartrain Bridge in Louisiana, United States is the longest in the Western world. It cost roughly NZ$561m in today’s dollars. For a 60km-odd long bridge, that would be more than $1 billion.

Looking towards Wellington city - the starting point for a tunnel or bridge?

ROBERT KITCHIN/STUFF
Looking towards Wellington city – the starting point for a tunnel or bridge?
 The 55km Bang Na Expressway in Thailand, which would be closest in size to a Cook Strait Bridge, cost about NZ$1.9b in today’s dollars when it was completed in 2000. Both are a steal compared to the estimated $3.4b cost of Auckland’s City Rail Link.

Tunnels, on the other hand, are much more expensive.

The 2.4km Waterview Tunnel in Auckland cost $1.4b, which equates to about $583m per kilometre. For a 27km tunnel, that’s $15.7b. For a 65km tunnel, that’s $37.9b.

One of the possible routes for a Cook Strait bridge or tunnel: Wellington to Picton, the shortest route between two ...

JULIAN LEE/GOOGLE MAPS
One of the possible routes for a Cook Strait bridge or tunnel: Wellington to Picton, the shortest route between two developed centres, 64km.
 Stuff pitched the strait drive options to the New Zealand Transport Agency (NZTA). A spokesman pointed out that using the Waterview’s costing was probably not worth while.

“Waterview Tunnel went through rigorous business case and cost/benefit analysis. It’s hard to imagine a serious case for a Cook Strait tunnel that would be more than 10 times longer and three times deeper than Waterview and considerably more expensive.

Nonetheless the NZTA was open-minded.

“To the best of our knowledge there’s never been a serious feasibility study of a Cook Strait tunnel, nor has there been a need for it,” the spokesman said.

“The costs to build and operate such a tunnel would be huge, but anything is possible with unlimited time, money and expertise.”

There does not appear to be a simple way to work out how much tunnels cost.

The Channel Tunnel, or “Chunnel” connecting Britain and Europe has the longest undersea portion of any tunnel in the world – its total length is 50.45km, just shy of what would be required under the Cook Strait. The Chunnel’s lowest point is 75 metres below sea level – the strait averages almost twice that depth at 128m.

The Chunnel cost £9b at the time of completion in 1994 – something like $30b in today’s New Zealand dollars.

Japan’s Seikan Tunnel is 54km connecting the islands of Honshu and Hokkaido across the Tsugaru Strait, which is much deeper than Cook with a maximum depth of 200m. Japan, like New Zealand, is a shaky country. It cost around NZ$10b in today’s money.

Stuff pitched the idea of crossing the strait to Treasury. A Treasury spokesman said: “In a hypothetical situation such as what you suggest, the Treasury would provide analysis and free and frank advice to the responsible ministers.

“We would factor in a number of aspects, such as cost-benefit analysis, alternative options and solutions for whatever issue the project is intended to address, impact on the Crown accounts, the government’s capital spending allowances, project funding alternatives (eg government-funded, privately funded, a public-private partnership etc), broader considerations such as environmental and social impacts, and other matters.”:

The spokesman also said how much money was in the kitty for transport infrastructure projects: There is $3.4b available this year and another $3.4b next year, but in 2020 there will be only $3.1b and the following year just $2.7b.

In other words, even if the government were to spend 50 per cent of the country’s capital allowances for transport over the next four years, a tunnel starting from Wellington might not even get to the water.

ANOTHER SOLUTION

Having to choose between a bridge that could fall over in the next earthquake and a tunnel that could impoverish the entire country would be enough to make most Kiwis spit their tea out. But perhaps there is a third way.

Palermo, the engineering professor who wrote off the idea of a traditional tunnel or bridge, has another, more modern idea. A “submerged floating tunnel” – a tunnel that floats on or near the surface of the sea and is anchored to the ground.

One has never been built, but the idea is being developed and explored in places like Japan and the USA.

Palermo said sea currents, earthquakes and tsunamis are the main challenges, but: “I think the concept could be feasible. Construction will not be easy, but not far different than building an off-shore petrol platform. The bridge could be manufactured with innovative ultra-high performance concrete and segments of the tunnel prefabricated in a specialised precast yard.

“The great challenge will be the anchors, but it will not be more challenging than an off-shore platform.

“Given the flexibility of the tunnel, its response to earthquakes may not be so problematic and the anchors could be designed to accommodate big ground displacement generated by fault rupture.”

Palermo said the ultra-high performance concrete will reduce the amount of concrete required and guarantee long-lasting durability – perhaps more than a century.

“I also like the possibility to create within the tunnel an outlook with structural glass windows and turning it into an iconic tourist attraction.

“Moreover, it could have a negative carbon footprint (this means that it doesn’t have embedded energy costs) if the impact of currents could be turned into energy to be used for the tunnel or possibly sold out to Wellington and Marlborough.

“It will not have a strong environmental impact and I think it could be seen in the future, especially if there will be a take over with electric cars.”

Palermo said the concept is still being developed and costs are unknown.

The closest New Zealand has ever come to physically uniting the country seems to be a bit of political banter loosely attributed a politician more than a century ago. Seasoned politicians from our own time have not even heard the idea raised once in the halls of Parliament – not even in the back halls.

If New Zealand were to really bridge a 20,000-year-old gap over one of the more problematic stretches of water the world has to offer, it may be time, rather than money, that might be the best bet.

 – Stuff

Auckland Transport throws out its own plan

2 Feb, 2018

Auckland Transport produced this image of how light rail would look but ranked it so low it would not get funding. Photo / Artist Impression
Auckland Transport produced this image of how light rail would look but ranked it so low it would not get funding. Photo / Artist Impression

Comment by Simon Wilson

How embarrassing. The board of Auckland Transport (AT) has rejected the draft of its most important planning document, prepared for it by AT staff. The reason? The recommendations in the draft ignored AT’s own policies. They also ignored the policies of Auckland Council, which AT is supposed to answer to. And they ignored the clearly stated wishes of the new government, which has a say because it co-funds so much of the city’s transport programme.

Will heads roll? Unlikely, but possible.

It started last week, when AT published, under the signature of Shane Ellison, its brand-new CEO, the draft of its new 10-year plan. Nearly half the funding for commuter rail was gone, light rail was ranked so low it would not get any funding at all, and the cycling and walking budget was slashed by 90 per cent.

Cue immediate scrambling for cover. The chair of the AT board, Lester Levy, even rang the Minister of Transport, Phil Twyford, to apologise. Twyford tweeted: “I’ve had sincere apology from AT chair Lester Levy for internal ‘budget’ document mistakenly made public. The doc certainly doesn’t reflect my conversations with @phil_goff and @AklTransport board and our shared commitment to building a modern transport system for Auckland.”

Well, good. But this was not some simple “mistake”.

The document was a new draft Regional Land Transport Plan (RLTP), which is written anew every six years and refreshed every three. This is a refresh year, although with Labour and the Greens determined to keelhaul National’s transport planning, the right time for a full rethink by AT is now. The document even says as much, although without doing it.

What did it get so wrong?

One, it ignored Auckland Council’s guidelines, which are also AT’s own priorities. Through a “Statement of Intent” agreed with council, AT has prioritised public transport, active transport (cycling and walking), road safety and carbon reduction. The draft RLTP just set all that aside.

Two, it ignored the government’s own signals. Twyford and associate minister Julie-Anne Genter, who looks after active transport and safety, have both been clear. In particular, they’ve told us light rail will be a priority and some of National’s expensive new roads (including the East-West Link from Penrose to Onehunga) will not happen. The draft RLTP, however, effectively pretended Twyford and Genter don’t exist.

Three, the draft wasn’t leaked or released casually. It was an official public document prepared for the AT board and posted online in what is usually a carefully managed process. Damningly, it was signed off by CEO Shane Ellison and two of his senior executives.

 

Four, it included a fabricated “introduction” from Levy. He didn’t write it, which isn’t uncommon, but nor did he see it before publication. That’s astonishing: who releases a statement by the boss without getting it cleared by the boss?

In a lengthy conversation on Wednesday, Levy told me he was especially upset about this and “I have made that very clear to the CEO”.

I asked him if it was humiliating to have to apologise to the minister. He said, “Yes. I spend a lot of my time having to apologise for things I didn’t know about. This is the job, and yes it is embarrassing.” (Levy is also the chair of Auckland’s three health boards.)

The offending draft had two main parts. One was what Levy calls a “narrative”: it described the work of AT in language very much in line with other recent AT documents and with the thinking in council and the new government.

“Our priorities actually align very well with what we know of the Government’s,” Levy told me, and he repeated that at the board meeting. “This government has got some great aspirations,” he said.

But the second part was a list of all the transport projects, both underway and proposed. It ranked them and recommended specific levels of funding for each. It was the guts of the document. Free of rhetoric and wishful thinking, it appeared to reveal what the officials who wrote it think AT should do.

When it got to the AT board yesterday afternoon, Cynthia Gillespie, head of strategy and one of the document’s signatories, attempted an explanation. AT has 320 projects it could be working on, she said. If they did them all, over 10 years they’d cost $19 billion. So obviously they’re not doing them all.

To help choose the best they have a “calculator”, a piece of software that assesses each project against a set of objectives. The calculator reflects the Auckland Transport Alignment Project (ATAP), an agreement about transport priorities signed by the previous government and the previous council. Gillespie blamed the calculator for scoring light rail and cycling very low.

ATAP is now out of date and under review. And yet AT officials used it produce recommendations that would have suited the old government but were profoundly out of line with the new one, and with council, and with AT itself.

To the board’s credit, they threw them out.

Still, they had a problem. By law, AT must adopt a new draft RLTP, put it out for public consultation and sign it off by the end of June.

But the government will not produce its official transport policy statement until late March. If AT has to wait till after then to produce the new RLTP, the public input phase will suffer.

Board member Sir Michael Cullen saved the day.

“We are pretending we don’t know what we really do know,” he said. He listed various projects Twyford and Genter have said they want prioritised and added, “I don’t think it would be improper for staff to prepare a new draft RLTP that reflects what we can reasonably expect will happen.”

They will now write a new plan, in the expectation it will align with the government’s policy statement when it arrives. Which is what should have happened in the first place.

Meanwhile, Lester Levy still wants to know how all this happened.

I asked if he felt let down by some of the senior management. “I don’t know but I will certainly let you know when I find out.”

He also said, “We have given our new CEO a mandate to deliver culture change in the organisation.”

That’s very good to hear.

An engineering marvel: Lyttelton Railway Tunnel turns 150

Lyttelton Rail Tunnel, seen here in the old Illustrated Press, 
opened in 1867 to join Christchurch and the port.

Press Archives
Lyttelton Rail Tunnel, seen here in the old Illustrated Press, opened in 1867 to join Christchurch and the port.

Imagine arriving fresh to New Zealand at Lyttelton and disembarking from a ship with all your worldly belongings, ready to start a new life in a blossoming little town called Christchurch.

You’ve travelled for months to get to your new home, but this final stage throws up one of the trickiest parts of the journey – a long, arduous scramble over the steep Bridle Path of the Port Hills or a perilous journey by small boat across the Sumner bar to Ferrymead.

The idea would be enough to put anyone off.

The tunnel under construction, with provincial engineer, Edward Dobson in his distinctive white top hat, to the right of ...Press Archives

The tunnel under construction, with provincial engineer, Edward Dobson in his distinctive white top hat, to the right of the tunnel entrance.

But while the hills were an inconvenience for travellers, for businessmen desperate to export Canterbury’s goods to the rest of the world they were a major hindrance with the potential to cripple the market.

The region’s early settlers realised this, and almost as soon as they’d poured off the Four Ships there were murmurs of building a tunnel through the hills.

Steam engines replaced the electric locomotives on the Lyttelton line during repairs to the overhead equipment at ...

Press photographer
Steam engines replaced the electric locomotives on the Lyttelton line during repairs to the overhead equipment at Woolston in August 1932.

The idea was mooted in the early 1850s, but political wrangling proved a stumbling block as conservative colonists condemned it as financially reckless and an unnecessary extravagance.

Chief among the opposers was James FitzGerald, a former superintendent of Canterbury province who dismissed it as ill thought-out and unaffordable.

But his successor William Moorhouse, elected in 1857, was a great advocate.

Heavy rails on the curve at the entrance to the Lyttelton tunnel were replaced with new ones in 1933 after the weight ...

Press photographer
Heavy rails on the curve at the entrance to the Lyttelton tunnel were replaced with new ones in 1933 after the weight and speed of electric locomotives caused considerable wear.

“Railway Billy” asked the council to “consider and determine the best method of securing safe and expeditious transit of our marketable productions to the place of export”, and in October 1858 a decision was made to built New Zealand’s first railway tunnel and the first in the world to pass through the side of an extinct volcano.

Work began in 1860 but the British contractors demanded more money and gave up when they hit rock.

Undeterred, Moorhouse sailed to Melbourne and recruited new contractors.

The first locomotive and train in New Zealand, at Heathcote in 1863.

Press Archives
The first locomotive and train in New Zealand, at Heathcote in 1863.

The actual building work fell to Edward Dobson, Canterbury’s provincial engineer, who opened up access cuttings at each end of the tunnel.

Educated at university in London, he had studied the new Belgian railway system and brought his knowledge to New Zealand.

David Welch, an historian who has written a book about the tunnel, Port To Plains, said Dobson’s brilliance was key to its success.

Heathcote Valley rail station, signal box and the rail tunnel to Lyttelton, January 1981.

The Press
Heathcote Valley rail station, signal box and the rail tunnel to Lyttelton, January 1981.

“To me, he is the real hero of it all,” he said. “We were very lucky to get such a multi-faceted engineer. He was hugely influential.

“At the time railways were pretty new – there was no railway line in New Zealand when they started building the tunnel, and it was still pretty new technology in a way.”

Work was arduous to say the least, with progress at a painstaking three metres a week.

Lyttelton railway tunnel is just as important today as it was 150 years ago, with over a million tonnes of coal being ...

Lyttelton railway tunnel is just as important today as it was 150 years ago, with over a million tonnes of coal being freighted through every year.

Miners attacked the face with pick and shovel, using gunpowder to bring down rock that was then carried away by horse-drawn wagon.

More rock had to be excavated than was expected, the tunnel was incredibly stuffy and ventilation shafts had to be put in to allow workers to breathe.

It was also very wet – so bad that in one stretch a cover had to be built to protect miners.

Welch said: “At one stage there was 50,000 gallons a day pouring off the rock face above them … They couldn’t get rid of the water and had to bucket it out in big wooden vats.”

Despite the conditions there were few injuries, with just two deaths during an explosion.

Eventually, on May 24, 1867, the two holes being bored from each side met and an iron rod was passed through. A few weeks later the public were able to walk the entire length of the tunnel.

The Lyttelton tunnel was officially opened for passengers on December 9, the journey taking seven minutes – a far cry from the struggle over the Bridle Path.

But the tunnel wasn’t quite finished – workers still had to shape the inside, finally completing it in 1874.

It eventually contained 1.5 million bricks and cost 195,000 pounds to build.

KiwiRail engineer Trent Ludlow said it was a “massive achievement”, given its complexity.

He said: “Strategically for Christchurch, when you look at the challenges they had in getting their goods in and out, without that tunnel it would have really restricted the growth of the city.”

The tunnel was crucial for Christchurch and the success of the Lyttelton port, carrying both goods and passengers between the two.

And its role has changed little in 150 years, trains carrying 1.1 million tonnes of coal, 300,000 tonnes of logs and up to 80,000 containers through the tunnel every year.

“For us it is a vital link for us, so good-on the forefathers for having that vision,” Peter Davie, the port company’s chief executive said.

“As the rail tunnel was established it allowed Lyttelton to develop as a deep-water port. That was the primary issue – we didn’t have a deep-water port in Canterbury.

“It really opened up the region for trading.”

Today, up to nine trains a day travel through the tunnel, all now carrying freight after the 2010 and 2011 earthquakes.

 – Stuff

Rail has saved New Zealand $1.5 billion a year, study shows

Transport Minister Phil Twyford said the report showed the benefits of investing in rail.

STUFF
Transport Minister Phil Twyford said the report showed the benefits of investing in rail.

New Zealand’s rail network has save the country $1.5 billion by reducing congestion wait times, accidents and emissions, a report has found.

The total cost avoided by having passengers off the roads and on rail was $1.19b alone, according to consultancy firm EY.

Their report was produced in 2016, commissioned by the New Zealand Transport Agency (NZTA) but the former government never released it.

A year-old study, just released by the Government, shows $1.5b in savings of congestion and safety incidents, by having ...

STUFF
A year-old study, just released by the Government, shows $1.5b in savings of congestion and safety incidents, by having a rail network.

New Transport Minister Phil Twyford said the study supported further investment in rail, and reinforced the Government’s plans to do so.

EY found the net benefits provided by passenger rail amounted to $1.2b in savings from reduced congestion, $8.2m in safety benefits and $3m in reduced emissions.

For freight, there was an estimated total net benefit of $354m.

“The implications of these findings for passenger rail is that the support it receives from subsidies (central and local government) is highly likely to be acceptable because passenger rail is calculated to add significant value by reducing congestion on Auckland and Wellington’s arterial roads,” the report said.

“The implications of these finding for freight rail is that the Government funding it receives is likely to be acceptable as the total benefits (both quantitative and qualitative) could be greater than the Government support it receives.”

However, the study had a number of limitations across all measures, said EY, and a more analysis was needed to confirm freight rail’s benefits outweighed the subsidies afforded it by Government.

The study also broke down the time delay costs for the two major cities; Auckland and Wellington.

In the capital, it found that even with its passenger rail system, 19.8m hours worth of congestion came in at a cost of around $303m in time delay. In Auckland, the traffic situation was more complex.

The net time delay cost was about $882m, and the report’s writers said that represented an 57m extra vehicle hours on Auckland roads.

Twyford said rail was a “great way to travel and move cargo”.

“It takes both passengers and freight off the roads, improving the travel experience of road users and reducing their costs.”

The Government would “restore balance” to transport funding and boost investment in rail infrastructure both for passengers and freight.

“This will include significant investment in regional rail via the Regional Development Fund, as set out in the Labour-New Zealand First coalition agreement.

“The establishment of a light rail network in Auckland will significantly increase the $1.3b a year of benefits that road users, including freight companies, experience from reduced congestion,” Twyford said.

STACEY KIRK – Stuff

Government addresses concerns of transport industry

Transport Minister Phil Twyford (file photo).

BRADEN FASTIER
Transport Minister Phil Twyford (file photo).

New and additional sources of funding are needed to help fix Auckland’s traffic congestion and growing pains, Transport Minister Phil Twyford says.

But Twyford believes it is not fair for the rest of New Zealand to pay for its biggest city’s woes.

Rail and coastal shipping will be a focus for both Auckland and elsewhere, he said.

The newly named minister made the comments in his first address at the Road Transport Forum’s annual conference in Hamilton on Saturday. “If we had a decent passenger rail from Auckland to Hamilton paid for out of the Land Transport Fund, then I could have been here much earlier,” he joked, referring to what RTF Chief Executive Ken Shirley had said to him after arriving late to the conference, having got stuck in traffic.

During the conference at Claudelands Event Centre, Twyford outlined the government’s direction on the future of transport throughout the country.

Creating a “resilient and multi-modal transport system, reducing carbon emissions and fixing Auckland’s congestion” were the priorities.

“We know the transport system is about networks and productivity and changes to one mode can have flow-on consequences.”

Transport in New Zealand needs to be resilient in the face of shocks, such as the recent earthquakes that shut down the major north-south highway in the South Island.

To do this, changes to funding is required.

Roading is currently funded through the Land Transport Fund, from road user charges, petrol tax and vehicle registration, which generate $4 billion a year.

“We need to tackle the problem of new and additional funding sources and the challenge of dealing with Auckland’s growth pains is one of the pressures here.”

Decades of under-investment and congestion in Auckland is costing the city $1.3b a year in lost productivity, he said.

Aucklanders want it fixed, but Twyford said it will come at a cost.

“They understand that it costs money to do this.”

The Government is committed to a $15 million, 10-year programme that includes a rapid transport system in Auckland, which will join up with the road and highway system.

“We believe rapid transport should be funded in the same way as state highways and there are benefits for at least part-funding the rapid transport through the Land Transport Fund.

“We need to find additional sources of funding as well and we cannot ask the rest of New Zealand to pay the costs of Auckland’s growth.”

If asked, the Government will pass legislation to allow Auckland Council to levy a regional fuel tax, he said.

“We’ve talked about 10 cents a litre and that would generate about $150 million a year, about 10 per cent of the investment that is needed for the Auckland Transport Plan.

“Aucklanders have to be willing to chip in a bit extra.”

Income from targetted rates on what will be “massive increases” in the value of the land around the light rail network in Auckland could be reinvested in the rapid transport system, he said.

“The Government is going to continue to fund rail above and beyond the national transport fund, but what we want is to generate new and additional sources of revenue.

“In the long term, petrol excise will not be a sustainable way to fund the transport system.”

Previous governments had disproportionately invested the fund into motorway projects, leaving regional roads starved of funds, he said.

“Our coalition partner placed a very high premium on investment in the regions, so that will be a priority.”

Reducing carbon emissions

Another priority would be reducing carbon emissions from the transport industry, which make up 18 per cent of the country’s greenhouse gas emissions, he said.

Exploring coastal shipping is one way of doing this, he said.

“I believe if we level the playing field, coastal shipping can be a cost-effective way to move heavy bulk freight that is not time-dependent.”

He also addressed one of the biggest concerns from the industry – the shortage of top-class drivers.

Attendees said the driver-licensing system had become complicated and expensive.

Twyford said the government wanted to weave driver licensing into the school curriculum.

“When people don’t get their licence or never graduate to a full licence, it has downstream negative consequences for them to get jobs.”

He said stemming migrant numbers would not affect those in the transport industry.

“You’ll know the intention to change the immigration settings, as we believe the open door policy of immigration had quadrupled net migration.

“We think we can combat this by taking out the rorts and the scams in the education sector, where so-called education providers have been giving back-door visas.”

There are genuine skill shortages and regional skill lists will mean a particular regions can attract people in to live and work in that region, he said.

Transport weak link for doing business – ODT

Banked-up traffic near Milburn.

Banked-up traffic near Milburn.
A freight train near Wingatui, both south of Dunedin.

A freight train near Wingatui, both south of Dunedin.

New Zealand’s road and rail  transport networks have been found wanting. ODT senior business reporter Simon Hartley talks to Westpac’s new industry economist Paul Clark about the  country’s road and rail.

Internationally, New Zealand’s roading network is ranked 40th out of 137 countries while the rail network comes in at 47th, the latter behind Poland and Hungary.

The data comes from the World Economic Forum’s recently published global competitiveness index report. It ranks New Zealand’s overall competitiveness as 13th out of the 137 countries.

However, Westpac’s industry economist Paul Clark said the data showed companies were ”dissatisfied” with the state of road and rail.

”The quality of our road and rail networks was identified as one of a number of weak spots in our overall competitiveness,” Mr Clark said.

New Zealand has 95,000km of road, including 11,000km of state highways. Rail is 4100km in length.

New Zealand has for more than a decade been spending $5billion a year in these areas, most of it on road and rail infrastructure.

Firms operating in New Zealand had for 2017-18 rated the quality of the country’s roads as the same as 2009-10, meaning ”no change in quality over the past eight years,” he said.

”This is not a one-off.

”For a number of years an inadequate supply of infrastructure has been seen by firms as being the biggest hurdle for doing business in New Zealand,” Mr Clark said.

He said the importance of having a high-quality land transport network could not be overstated, both for domestic use and getting exports to the rest of the world.

”When working well they can make a significant contribution to New Zealand’s economy . . . but when not, they can constrain the economy’s growth and prosperity,” Mr Clark said.

About 82% of New Zealand’s roads were open to ”high productivity vehicles”, or heavy commercial traffic. They have a capacity to carry from 44 tonnes to a maximum 62 tonnes.

”These vehicles help freight operators move more freight with fewer trucks, at lower cost,” Mr Clark said.

Unsurprisingly, those vehicles account for more than 30% of heavy commercial traffic, he said.

Mr Clark said the capacity of the road network against demand for travel had only ”edged higher” in recent years. The country’s relatively strong domestic economic performance had underpinned the growth in demand.

”Much of this [annual $5billion] spending has been focused on addressing an infrastructural deficit caused by chronic under-investment in the 1980s and 1990s,” Mr Clark said.

The spending had increased the road network capacity and helped to maintain it in ”tip-top” condition. But it had not always been enough to handle some of the large increases in traffic, at least without some deterioration in network performance.

While progress had been made on rail and road public transport, particularly in Auckland, there had only been ”limited progress” on freight – with almost 85% moved around the country by road.

”There’s good reason for this. Road is not only cheaper than rail, it also provides a convenient door-to-door service,” Mr Clark said.

By contrast, rail typically involved road-bridging freight to a public freight yard or container transfer facility, or investing in and servicing customer rail sidings.

”Either of these takes time, money and logistic effort.

”That’s not to say possibilities do not exist – the New Zealand Transport Agency and KiwiRail, together with sector partners, are actively looking at ways to improve road and rail integration, but more needs to be done.”

Earlier this week, Port Otago floated the idea of eventually having State Highway 88, between Dunedin and Port Chalmers, truck-free, but rail would have to be embraced to achieve that end.

Mr Clark said ”the key is to improve the competitiveness of rail freight and until that happens the possibility of a fully integrated transport system seems quite far off.”

While neither the data nor Mr Clark delved into the political scene, whichever government is formed money will still need to be spent on national transport.

National has roads as its priority but Labour, the Greens and New Zealand First all favour upgrading New Zealand’s rail.

Coalition deals

As at 24/10 we have very little detailed information about the nature of the transport related items in the coalition deal Labour/NZ First, and the confidence and supply deal Labour/Greens.

So far the key points relate to:

• Rail: Significant investment in regional rail. – [We’re not sure exactly what this means]

• Auckland Port: Commissioning a feasibility study on moving the Ports of Auckland to Northport – [It’s hard to imagine this flying – Auckland won’t want to lose control of their own destiny in a port/shipping sense, and it’s hard to imagine the Greens being happy with an increase in carbon miles for the transport from Northport to Auckland.  Not to mention the absolutely massive cost to upgrade rail from Northland to Auckland]

• Transport: Investigate a Green Transport Card to reduce the cost of public transport for low-income people and welfare recipients, prioritise National Land Transport Fund towards rail infrastructure as well as cycling and walking, cancel Auckland’s East-West motorway link, work towards light rail from Auckland city to airport [The East-West cancellation is a shame, and we’re surprised that the NZ First preference for heavy rail to the airport wasn’t adopted in the Labour/Green deal]

Railway from Picton to Christchurch closes again after wet start to October

KIWIRAIL
A wet start to October has caused slips to come down on the Main North Line, which is expected to remain closed until the end of the month.

The newly rebuilt railway line from Picton to Christchurch could be closed for the rest of the month after recent rain brought slips down across the tracks.

Hundreds of spectators turned up to watch the first freight train since the November earthquake take the Main North Line on September 15.

The celebration was short lived. Heavy rain closed the track after the one train went through. It reopened 10 days later, but has closed again.

Hundreds turned up to watch the first freight train since the November earthquake take to the track on September 15. The ...

KIWIRAIL

 

KiwiRail blamed the latest closure on an unusually wet start to October for the Kaikōura region.

Acting chief executive David Gordon said the “unusually heavy rainfall” caused 31 slips in the area, including three major slips onto the railway line and next to State Highway 1.

He said KiwiRail was working to “make repairs and add resilience” ahead of the peak freight period.

“At this stage we expect services to operate on the line again at the end of this month.”

KiwiRail ran two freight trains each weeknight on the line, leaving it clear during the day and over the weekend for additional repairs to the track and SH1.

Gordon said some disruption was always possible with the limited reopening, but the rain created “much greater disruption than we could reasonably predict”.

He said KiwiRail regretted the impact on customers – and that they could not take some of the freight burden away from the Lewis Pass, which is on the alternative highway route while SH1 is repaired.

KiwiRail previously claimed the Main North Line reopening would take 2000 trucks a month of the road, a figure some in the industry disputed.

At the last closure, general group manager network services Todd Moyle said the Main North Line was likely to shut up to 25 days a year, based on its current state.

MetService forecaster Cameron Coutts said Kaikōura had received 84 millimetres of rain so far in October, which was “well above” the month’s average of 57mm.

He said it should be dry and relatively warm before showers returned on Monday and Tuesday. A “settled spell” was expected for the latter half of next week.

“In saying that, we’re still in spring, so it’s still pretty changeable,” Coutts said.

 – Stuff

Cubic resumes inter-island rail service

We have good news and bad news about the resumption of limited rail services.

Cubic has access to a limited number of container slots on one of the two daily trains each way between Picton and Christchurch.  These slots are very expensive in the post-earthquake freight environment, due to scarcity and the need for KiwiRail to recover costs.

Slots on these services are available on a “take or pay” basis.  Meaning a confirmed booking is charged for whether or not the container is presented prior to cut off.

A wait list system is operating but there is no discount or other latitude with wait-listed bookings.

If you want rates for inter-island rail services please email sales@cubic.co.nz

For an update on Kaikoura earthquake recovery click here to download NZTA’s latest bulletin.

 

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