Surely it should be the squandering of public funds on changing one perfectly serviceable electrification system to another which happens to be flavour-of-the-month to the techies, incompatible with all the lines it crosses, causing great disruption during its installation, and introducing all the voltage changeover point unreliability at Redhill etc, that should Not Be An Option.
Why was Surrey Quays to Peckham Rye, a newly-built route, allowed in the last couple of years to be infill 3rd rail when dual voltage units were employed?
A couple of points - again going over ancient ground here
a) North Downs 750V DC to 25kV hasn't yet progressed, IPEMU is being discussed as an option here in place of converting the whole route to 25kV AC with the difficulties that would entail for other operators.
b) Electric Spine 750V DC to 25kV still isn't fully committed for CP6, but it won't come at any squandering of public funds, life expired DC equipment will be removed and replaced with less expensive AC equipment, ongoing cost savings will be realised through reduced electrical losses, and further positive financial benefits are realised through increased electrical supply capacity which will enable freight to convert to electric traction, for longer and more frequent services, opening up new destinations as track capacity permits
c) Third rail was perfectly serviceable, it's growing less serviceable as demand on the system increases. It's costly to increase capacity on the system thanks to the complex way power is taken from National Grid and transformed to 750V DC for the third rail and resistance losses increase as power draw increases.
It's an incontrovertible fact that stock is limited to lower speeds, lower acceleration and shorter formation lengths as a result of limitations on the DC system. The potential to operate services at 110mph using AC would release considerable capacity, which returns to the argument at (b) which counters your argument that public funds would be squandered, the opposite is true.
And when it comes to the TfL Overground, they got in before ORR firmed up the Energy TSI compliance documentation. The safety case undoubtedly benefited from being in the planning stage long, long before DC to AC conversion became policy in the 2012 HLOS with Electric Spine. I can't envisage doing it any other way, but it was an astonishing failing of the TfL Overground works not to use the rebuilding opportunity to do DC to AC conversion, maybe less so for passenger use, but certainly from a freight perspective. It really is all a terrible mess thanks to the lack of a proper electrification strategy being in place at the time.
Hopefully that's not the case going forward.