ORR massivley raising freight prices

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WatcherZero

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ORR is currently consulting on massivley raising the freight track access charges that NR will charge by as much as 400% for power station coal. ORR believes this price jump will only reduce the amount of coal carried by 5% with other bulk goods such as hoppers, wagons and container freight also facing large jumps in pricing and seeing falls in shipping of upto 25% predicted. However ORR believes that this will produce a net increase of £50m per year in NR income. Freight currently makes up 7% of traffic but provides only 1% of Network Rails income around £55m per year. NR estimates Freights share of its variable costs as £281m (£192m-£241m with ORR mandatory efficency targets)per year and that in the fives years between end of CP4 and end of CP5 it expects variable maintenence costs for freight to rise by 7% as opposed to 5% for passenger trains. This new system would force freight to pay its way as much as possible, starting with the fourfold increase for carriage of coal which is considered highly price inelastic it would reduce the variable cost for each type of freight so no more than 10% of existing traffic was scared away, it would also investigate setting freight track access charges on a regional basis.

Sensible adjustment to make freight actually pay its true track charges and reduce its subsidy? price gouging because of budget cuts and efficency drive? or just a neccesary evil, what do you think?

http://www.rail-reg.gov.uk/pr13/PDF/freight-charge-consultation-may2012.pdf
 
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sonic2009

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I always thought the plan was to get more lorry loads on to trains, this will surely cause companies to re-think.

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HSTEd

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Will there be anything in these proposals to help make Freight Multiple Units (which have lower axle loads and the like) more economically viable or is just a standard across-the-board-hike?
 

the sniper

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Off topic, but considering how much people lament the downfall of loco hauled passenger stock to MUs, I'm continually amazed by how often people think/dream about the possibilities for Freight Multiple Units on RailUK! :lol:
 

HSTEd

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Off topic, but considering how much people lament the downfall of loco hauled passenger stock to MUs, I'm continually amazed by how often people think/dream about the possibilities for Freight Multiple Units on RailUK! :lol:

Freight Multiple Units are a logical derivation of the effect of the same trends which destroyed major loco hauled passenger operations (ie. lower running costs, reduced track maintenance, lower axle weights, higher speeds, better acceleration and so on).

This is especially caused due to the fact that major freight operations are increasingly shifting towards intermodal technologies which favour the multiple unit system, (bulky but relatively light cargo that must be moved quickly).
 

captainbigun

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Price for diesel hauled freight should be massively inflated, too much staggering around under the wires with 66s and other oil burners.
 

AndyLandy

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ORR is currently consulting on massivley raising the freight track access charges that NR will charge by as much as 400% for power station coal.

I wonder if they've factored in how much their power costs for electric trains would increase by if they start charging more to transport the fuel? :lol:
 

GB

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Clearly that's different, but having 66s staggering up Shap and Beattock at 15mph is hardly good, either from an environment or customer perspective.

This argument has been done to death before. It is not viable for most freight operators to use electric traction.

As for the original topic, seems like a pretty big own goal to me:roll:
 

tbtc

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Freight currently makes up 7% of traffic but provides only 1% of Network Rails income

Sensible adjustment to make freight actually pay its true track charges and reduce its subsidy?

I think so - why should commuters be subsidising the transport costs for big business (power companies, TESCO etc)?

Maybe when we had small scale freight (Speedlink etc) I could see the need to subsidise it, but now it's effectively a backhanded way for large companies to be subsidised by passengers.

That said, a huge increase in track access charges may not mean a huge increase to the freight companies due to the cost of fuel/staff etc not being affected by this proposal.
 

yorksrob

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Obviously it would be a shame if recent gains in freight were to be lost through overpricing.

However, it does strike me that rail freight is always seen so much more positively in terms of cost/benefit to society, as opposed to regional passenger services which are still seen in many circles as a cash black hole - this in spite of the fact the two share the same railway network for a lot of the way.

An example of this would be the large number of mechanical signal boxes away from the main lines, which (if I remember correctly) McNulty pointed out as contributing to making the regional passenger railway more expensive -yet shouldn't replacing these be as much a burden for freight users as the regional passenger (at least where the tracks are shared by the two) ?

I don't know whether the increases proposed are vastly too high to be accounted for by such upgrades - was just wondering out loud..
 

Schnellzug

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So what's the Governmebnt's 'justification' for this, or is it just pure greed with no attempt to provide a figleaf of justification? That they're "encouraging Green energy" by pricing coal out of the market or some such tosh?
 

michael769

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I would imagine that this is just an extension of the policy to make rail users pay the real costs of rail travel - just as passengers need to pay more so to freight operators.

The problem with this policy is that it fails to take into account the massive benefits to society as a whole that incentivising both passenger and freight rail travel brings. I suspect that if the benefits of subsidized rail travel were costed and brought into the equation the taxpayer would be seen to be getting a really good deal.
 

Schnellzug

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Price for diesel hauled freight should be massively inflated, too much staggering around under the wires with 66s and other oil burners.

An example of this would be the large number of mechanical signal boxes away from the main lines, which (if I remember correctly) McNulty pointed out as contributing to making the regional passenger railway more expensive -yet shouldn't replacing these be as much a burden for freight users as the regional passenger (at least where the tracks are shared by the two) ?

I don't know whether the increases proposed are vastly too high to be accounted for by such upgrades - was just wondering out loud..

* Sorry to once again go against the flow of what is commonly accepted as right & proper, but in both these cases, I can't help thinking that there's one great advantage to (a) using Diesel traction, and (b) having small signalboxes rather than huge centralised control centres, and that's reliability & flexibility. Electric trains are dependent on an external power supply and an elaborate, expensive and rather prone to damage power supply infrastructure, and we know how easily huge centralised control centres can be knocked out by someone having it away with a Cable somewhere. With staff conveniently at hand on the ground, signalling difficulties can be dealt with more much quickly than having to wait for a Rapid Response Squad to come in a van from 50 miles way, and Diesel trains are free from dependence on an easily damaged and hugely expensive infrastructure.
I know, you'll say, it's not forward thinking and Modern, where everything should be powered by Electric and the only thing that matters is to go as fast as possible everywhere . i know, what can I say, I'm sorry. :(
 

DownSouth

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However, it does strike me that rail freight is always seen so much more positively in terms of cost/benefit to society, as opposed to regional passenger services which are still seen in many circles as a cash black hole - this in spite of the fact the two share the same railway network for a lot of the way.
A rural branch line used only by small amounts of passenger traffic (of which there are many) could be replaced by (or is possibly already duplicated by) one or two buses that would provide an improved service in some ways and a close to equal service in others.

A line used only by 4-5 coal trains each day could be replaced by 160-200 full-length lorries.

Which makes a better case for continuing to maintain the rail infrastructure? Hint - it's not the passenger-only line.
 

HSTEd

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* Sorry to once again go against the flow of what is commonly accepted as right & proper, but in both these cases, I can't help thinking that there's one great advantage to (a) using Diesel traction, and (b) having small signalboxes rather than huge centralised control centres, and that's reliability & flexibility. Electric trains are dependent on an external power supply and an elaborate, expensive and rather prone to damage power supply infrastructure, and we know how easily huge centralised control centres can be knocked out by someone having it away with a Cable somewhere. With staff conveniently at hand on the ground, signalling difficulties can be dealt with more much quickly than having to wait for a Rapid Response Squad to come in a van from 50 miles way, and Diesel trains are free from dependence on an easily damaged and hugely expensive infrastructure.
I know, you'll say, it's not forward thinking and Modern, where everything should be powered by Electric and the only thing that matters is to go as fast as possible everywhere . i know, what can I say, I'm sorry. :(

Diesel trains are dependant on a quite rare highly expensive liquid fuel that will incrasingly have to be imported, whereas an electric train is dependant on whatever we have that makes electricity (nuclear, shale gas, hydro anything really) which probably makes it more reliable in the increasingly uncertain economic times ahead.

Additionally as to having local signal boxes, the benefits associated with having more people closer to the problem if something goes wrong is probably mitigated by the fact you need vastly more people whenever there isn't one.

Perhaps that rapid response team could be airlifted to the problem area in a helicopter.. would cut response time right down.
 

ainsworth74

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Additionally as to having local signal boxes, the benefits associated with having more people closer to the problem if something goes wrong is probably mitigated by the fact you need vastly more people whenever there isn't one.

If we're sensible we'll adopt a similar approach to that of the Dutch (at least I think it's the Dutch). They have only a few control centres used during normal operations but if one is taken out (for example by a fire as was the case recently) then the others have spare panels that can take over some of the functions and there are smaller local control posts that can be used during such disruption but aren't manned all the time.

There is no reason to my mind that having fewer larger control centres also means losing the inherent resilience of lots of smaller signal boxes.
 

Skymonster

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Tricky one isn't it???

* Freight trains (especially bulk load like coal) are slow and clog up infrastructure that's sometimes needed for passenger services. Either that or they demand more infrastructure to be built alongside passenger infrastructure to support freight running at the same time as passenger services
* Freight trains are heavier, therefore placing more wear on the track and demanding stronger infrastructure such as bridges
* If freight isn't paying it's fair share of the infrastructure costs, then it seems entirely reasonable to increase the access charges to reflect the true cost of providing for those services
* Its hard to argue that big business (power generators, etc) that are the beneficiaries of bulk freight and operate to make a profit shouldn't pay a representateive charge for movement of their raw material - note: its only for bulk loads of coal and nuclear they're talking about raising the charges for so far - it doesn't affect container traffic so doesn't affect Tesco and the likes.


On the other hand:
* FOCs are worried that they won't be able to pass on all of the increased costs to their customers, and thus their margins will be eroded
* I think we're all agreed anything that puts yet more heavy lorries onto the road isn't a good thing, and there's a risk some of the traffic will be driven to road if the track access charges go up too much
* Any extra charges that get back to the bulk consumer (i.e. power generators) is likely to be passed on to us, as end consumers of electricity. Meaning we may end up paying anyway, whether it's through subsidy to maintain the rail infrastructure or whether it's through increased power charges. However, the extra track access charges are so small a part in the total cost of generating electricity, it'd put very very little onto a household electricity bill

If heavy freight really isn't paying a fair share of the infrastructure costs based on the usage it has, the damage/wear it causes, and the extra infrastructure it needs - then I think that the costs have to go up sooner or later. On the other hand, I think the industry needs to place much more emphasis on moving bulk frieght at night and at weekends - I see lots of freight when I travel by train in the week, and hardly any at weekends. Moving freight to off-peak passenger times could free up [some more of the] infrastructure for passenger service and reduce the amount of additional infrastructure needed to accommodate freight services at the same time as passenger services. I can't believe it's vital for coal or cement or aggregates to move during the daytime, as long as the flow frequency can be achieved by nightime and weekend working.
 

transmanche

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A rural branch line used only by small amounts of passenger traffic (of which there are many) could be replaced by (or is possibly already duplicated by) one or two buses that would provide an improved service in some ways and a close to equal service in others.
Although the replacement bus wouldn't carry cycles - which is a consideration as we're being encouraged to cycle more.
 

David

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A line used only by 4-5 coal trains each day could be replaced by 160-200 full-length lorries.

And a few more .... I've just checked the Porterbrook site, and a HTA can hold roughly 75 tonnes of coal, so your looking at 3 lorry loads per single HTA. So for a 20 wagon coal train, that's 60 lorries of the roads.

Despite the proposed price increases, it will still be far more efficient to move coal and any other bulk products by rail. For example. To replace just one 20 wagon coal train on the Scotland - Yorkshire circuit with the required number of lorries, you could be looking at costs beyond £30 million a year once you take everything into account.

Even replacing just 1 train between Immingham and Yorkshire, your still looking at £10-12m a year in costs.
 

DownSouth

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An important thing to consider when demanding freight operators pay higher fees is service priority. If they "pay their way" just as much as the passenger operators do, they would be well within their rights to demand equal service priority. That would mean that during delays their trains would be sorted out as they came up in the queue rather than shoved aside until all the passenger trains were dealt with, that freight trains running on time would not be held up for passenger trains running late, and that freight operators would be entitled to larger amounts of compensation in line with the larger fees they pay.

This is the way it works on the freight-focused interstate routes in Australia which are mostly single track lines with passing loops once you get out of the major centres. Whichever train arrives first is put in the loop, and a freight train (which is of national importance, unlike the passenger trains used only by tourists and subsidised pensioners) will not be held one loop early so the passenger train can have a non-stop run.
Although the replacement bus wouldn't carry cycles - which is a consideration as we're being encouraged to cycle more.
Do they not have buses with front-mounted bike racks in the UK yet?



Internal space could also be provided in the low-floor section, just as it is for wheelchair users. The higher section at the rear would still have plenty of seats.
 
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DownSouth

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I cannot see that being allowed in the UK on pedestrian safety grounds!. A rear mounted version might fly, though I could see the bikes being pinched if not locked down!
They have been rolled out fully in a number of Australian cities now after there the trials proved there to be no safety issues. Walking into moving traffic and getting hit by a bus is usually an action with bad enough consequences, so unless UK pedestrians are significantly more stupid than those in Australia - even those in a city like Canberra infested with politicians and lawyers - then I can't see a problem there.

As I said above, 2-3 bikes could also be carried internally in the front part (low floor) of the saloon as wheelchairs are currently.

Edited to add - lots of cities in Canada and the USA have them as well.
 
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yorksrob

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* Sorry to once again go against the flow of what is commonly accepted as right & proper, but in both these cases, I can't help thinking that there's one great advantage to (a) using Diesel traction, and (b) having small signalboxes rather than huge centralised control centres, and that's reliability & flexibility. Electric trains are dependent on an external power supply and an elaborate, expensive and rather prone to damage power supply infrastructure, and we know how easily huge centralised control centres can be knocked out by someone having it away with a Cable somewhere. With staff conveniently at hand on the ground, signalling difficulties can be dealt with more much quickly than having to wait for a Rapid Response Squad to come in a van from 50 miles way, and Diesel trains are free from dependence on an easily damaged and hugely expensive infrastructure.
I know, you'll say, it's not forward thinking and Modern, where everything should be powered by Electric and the only thing that matters is to go as fast as possible everywhere . i know, what can I say, I'm sorry. :(

Don't worry - I'm not advocating the approach (I'll leave it to the technical bods to argue one way or the other) - I'm merely using it as an example that has been raised.
--- old post above --- --- new post below ---
A rural branch line used only by small amounts of passenger traffic (of which there are many) could be replaced by (or is possibly already duplicated by) one or two buses that would provide an improved service in some ways and a close to equal service in others.
.

Unfortunately the experience in this country has been that buses have just not been able to provide an equivalent service, in terms of speed, comfort or onward connections. This is illustrated both by unsuccessful bus/rail replacements in the past and in terms of non rail-connected towns today that are at an economic and social disadvantage when compared to their rail connected equivalents.


As for your cost/benefit argument - it is certainly true that a heavy coal train will remove a large number of lorries from the road and provide health benefits in terms of less pollution etc. However, by a similar token, even a short passenger train of two carriages can remove well over a hundred potential car journeys, leading to the equivalent reduction in congestion and pollution. There are also the benefits to the economy of allowing people to engage in economic activity.
--- old post above --- --- new post below ---
An important thing to consider when demanding freight operators pay higher fees is service priority. If they "pay their way" just as much as the passenger operators do, they would be well within their rights to demand equal service priority. That would mean that during delays their trains would be sorted out as they came up in the queue rather than shoved aside until all the passenger trains were dealt with, that freight trains running on time would not be held up for passenger trains running late, and that freight operators would be entitled to larger amounts of compensation in line with the larger fees they pay.

That's a reasonable point. It seems sensible that freight operators should receive a discount for a slower service. However, by a similar token, wouldn't it be the case that heavy freights would be likely to create more wear and tear on the railway (although I assume this is already factored in in track access charges).

I suppose my point is that for something like the replacement of signalboxes, for example, the type of traffic using the line is likely to have a limited impact on the overall cost, therefore it should be shared between passenger and freight operations, rather than being seen just as the regional railway's problem.
 
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Jonny

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And a few more .... I've just checked the Porterbrook site, and a HTA can hold roughly 75 tonnes of coal, so your looking at 3 lorry loads per single HTA. So for a 20 wagon coal train, that's 60 lorries of the roads.

Despite the proposed price increases, it will still be far more efficient to move coal and any other bulk products by rail. For example. To replace just one 20 wagon coal train on the Scotland - Yorkshire circuit with the required number of lorries, you could be looking at costs beyond £30 million a year once you take everything into account.

Even replacing just 1 train between Immingham and Yorkshire, your still looking at £10-12m a year in costs.

The problem with the HTAs is their bogies - they hammer the track harder than anything else, even other 102 tonne wagons with different bogies (as well as being noisier). Change the bogies, and they'd be much more efficient in terms of track wear - and quieter to boot.
 

captainbigun

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This argument has been done to death before. It is not viable for most freight operators to use electric traction.

As for the original topic, seems like a pretty big own goal to me:roll:

Possibly. I'd argue not, as would some at your employer infact. Diesel is going, fact, we can't ignore that. All those intermodals that stagger down the WC to Ipswich, that'd be a start.
 

LNW-GW Joint

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Sensible adjustment to make freight actually pay its true track charges and reduce its subsidy? price gouging because of budget cuts and efficency drive? or just a neccesary evil, what do you think?
I think the gist is that freight charges have been pretty much guesswork so far, with flat rates and uneconomic charging while the business matures in private hands.
It's certainly the time to get the charges more in line with costs and the true value of the business.
There has been very significant investment in freight routes in the last 5 years or so, with more to come, and NR/ORR is entitled to start recovering the costs of the upgrades (gauge enlargement, new loops, signalling etc).
Variable charges would seem to be the way to go.
I think the proposals are quite sensible, though the power generators will probably squeal.

Clearly that's different, but having 66s staggering up Shap and Beattock at 15mph is hardly good, either from an environment or customer perspective.

Then charge them for using a crippling 15mph path on our most important main line (say 400% uplift on an equivalent 60mph electric path).
They would soon opt for electric traction then.
That's why variable and geographic charges are a good idea.
 

tbtc

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So, other than digressing into the diesel/electric argument, a discussion about bikes not being allowed on many bus services and Beeching cuts, there's really nobody who can justify big business paying a fraction of their true cost to the railway for freight?
 
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