High-speed rail: A fast track to recovery?

High-speed rail: a fast track to recovery? Proposals to build a high-speed rail network linking Australian cities have been surfacing intermittently for decades, most recently raised as a way to boost our post-pandemic economic revival. However, there are also widespread concerns about the feasibility of such a plan. Here Greg Moran of the Grattan Institute voices his doubts, while Marcus Luigi Spiller of the University of Melbourne looks at the positives.

High-speed rail on Australia’s east coast would increase emissions for up to 36 years

Bullet trains are back on the political agenda. As the major parties look for ways to stimulate the economy after the COVID-19 crisis, Labor is again spruiking its vision of linking Melbourne, Sydney, Canberra and Brisbane with high-speed trains similar to the Eurostar, France’s TGV or Japan’s Shinkansen. In 2013 when Labor was last in government, it released a detailed feasibility study of its plan. But a Grattan Institute report released in May shows bullet trains are not a good idea for Australia. Among other shortcomings, we found an east coast bullet train would not be the climate-saver many think it would be. The logic seems simple enough Building a bullet train to put a dent in our greenhouse gas emissions has been long touted. The logic seems simple – we can take a lot of planes and their carbon pollution out of the sky if we give people another way to get between our largest cities in just a few hours or less. And this is all quite true. We estimate a bullet train’s emissions per passenger-kilometre on a trip from Melbourne to Sydney would be about one-third of those of a plane. We calculated this using average fuel consumption estimates from 2018 for various types of transport, as well as the average emissions intensity of electricity generated in Australia in 2018. If we use the projected emissions intensity of electricity in 2035 – the first-year trains were expected to run under Labor’s original plan – the fraction drops to less than one-fifth of a plane’s emissions in 2018. It should be remembered that while coaches might be the most climate-friendly way to travel long distances, they can’t compete with bullet trains or planes for speed. There’s a catch So, where’s the problem? It lies in construction. A bullet train along Australia’s east coast would take about 15 years of planning, then would be built in sections over about 30 years. This construction would generate huge emissions. In particular, vast emissions would be released in the production of steel and concrete required to build a train line from Melbourne to Brisbane. These so-called ‘Scope 3’ emissions can account for 50%-80% of total construction emissions. Scope 3 emissions are sometimes not counted when assessing the emissions impact of a project, but they should be. There’s no guarantee the quantities of concrete and steel in question would have been produced and used elsewhere if not for the bullet train. And the long construction time means it would be many years before the train actually starts to take planes out of the sky. This, combined with construction emissions, means a bullet train would be very slow to reduce emissions. In fact, we found it would first increase emissions for many years. Slow emissions benefit We estimate building the bullet train could lead to emissions being higher than they otherwise would’ve been for between 24 and 36 years. This period would start at year 15 of the project, when planning ends and construction starts. At the earliest, it would end at year 39. This is the point at which some sections of the project would be complete, and at which enough trips have been taken (and enough plane or car trips foregone) that avoided emissions overtake emissions created. This means the train might not actually create a net reduction in emissions until almost 40 years after the Government commits to building it – and even this is under a generously low estimate of Scope 3 emissions. If Scope 3 emissions are on the high side, emission reductions may not start until just after the 50-year mark – 36 years after construction began. The bullet train would create a net reduction in emissions from the 40 or 50-year mark onwards. But the initial timelines matter. The world needs to achieve net zero emissions by about 2050 if we’re to avoid the worst impacts of climate change. All Australian states and territories have made this their goal. Unfortunately, a bullet train will not help us achieve it. Hitting the 2050 net-zero emissions target implicit in the Paris Agreement remains a daunting but achievable task. Decarbonising transport will play a big part, including the particularly tricky question of reducing aviation emissions. But during the most crucial time for action on emissions reduction, a bullet train will not help. Our efforts and focus ought to be directed elsewhere.

Greg Moran is a Senior Associate at the Grattan Institute. Milan Marcus assisted in the preparation of this piece. This article was originally published by The Conversation. www.grattan.edu.au www.theconversation.com

Don’t abandon plans for high-speed rail in Australia – just look at all the benefits

The Grattan Institute’s call to ‘abandon’ plans for any high-speed rail network in Australia fails to look at the wider benefits such a project can bring by way of more productive economies and more sustainable towns and cities. The study authors argue the development of any bullet train network linking Brisbane to Melbourne via Sydney and Canberra is ‘unsuitable for Australia’. But what their argument neglects is that a project like high-speed rail has a unique capacity to reshape cities and population settlement patterns in positive ways. A question of cost The Institute’s study says the idea of high-speed rail is an unwanted distraction in policy-making for the nation’s transport future. Its case relies on a review of the high-speed rail experience in Europe, Japan and China. All of these nations, it says, have vastly different distributions of towns and major cities to that in Australia, which has extremely long distances between a few large cities. The study also critiques a 2013 Commonwealth analysis that found a $130bn high-speed rail project linking Brisbane, Sydney and Melbourne would generate a benefit-cost ratio of 2.3 to 1. So, every dollar invested in a high-speed rail network would generate $2.30 in benefits such as travel time savings, avoided vehicle operating costs and reduced road congestion. But the Grattan study authors say that figure is based on a ‘cherry-picked’ discount rate of 4%. This is economics jargon for the minimum return that the community would expect from the investment of its collective resources in any project. The Grattan study also says the 2013 cost-benefit analysis did not allow for cost over-runs. Nor did it consider the greenhouse gas emissions associated with the enormous quantities of concrete and steel needed to build the infrastructure. So why are some people, including the federal Labor Party, still so enamoured with the idea of high-speed rail when others would have it binned? Some projects reshape cities Not all transport infrastructure projects are equal when it comes to cost-benefit analysis. Some investments have a transformative effect on population settlement patterns – they shape cities and regions. The Sydney Harbour Bridge and the Melbourne Underground Rail Loop are classic examples of city-shaping projects. Each altered travel times between different parts of the metropolis, which then shifted the location preferences of households and businesses. This led to a substantially different city structure compared to what might otherwise have developed. Other projects, the vast majority of government transport outlays, merely follow or service the pattern of settlement established by the city-shaping investments. These “follower” projects include the local arterial roads and tramways that circulate people and goods within cities. The Commonwealth’s official guidelines for major project evaluation recognises this distinction. New ways of living, learning, working and playing become possible with city-shaping projects. By comparison, the procession of follower projects simply perpetuates settlement patterns and economic structures. This is the claim and appeal of high-speed rail. Advocates argue such an investment would divert a significant proportion of urban growth from the far-flung suburbs of metropolitan areas to new regional locations. That’s because these regions will then have similar travel times into core city labour markets. In these regional locations, households would enjoy greater housing choice and affordability, more walkability, and better access to open space. They could even have better access to a range of community facilities than their metro suburban counterparts. Advocates also argue that businesses in the big cities and intervening regional areas will be able to connect with each other at lower cost and source the skills they need more efficiently. This would boost productivity. Consider all the benefits The 2013 analysis took into account issues such as congestion, emissions (from travel) and transport accidents. But it did not attempt to quantify and monetise the effects of high-speed rail shaping cities and regions. Arguably, the most important set of benefits from this investment were left out of the economic evaluation, simply because they are difficult to measure. Modelling how the supply chains of businesses might change under the influence of city-shaping projects, or how the housing preferences of people might shift, is undoubtedly challenging. But being difficult to measure makes these impacts no less real. Despite this limitation on the scope of benefits, the 2013 study said the high-speed rail project would return a benefit-cost ratio of 1.1 at a 7% discount rate, which the Grattan study says is the usual test applied to transport projects. Grattan says the project barely scrapes in at this higher discount rate, and implies many other projects would offer ratios greater than 1:1 and should be preferred. These would typically be smaller follower projects that address local congestion problems. But a project achieving a 1:1 benefitcost ratio means Australia would still be better off undertaking the project compared to a business-as-usual case. If the transformative effects of high-speed rail include more compact and walkable cities with less car dependency and greater productivity, then such a network has good reason to keep its grip on the Australian imagination.

Marcus Luigi Spiller is an Associate Professor of Urban Planning (honorary) at the University of Melbourne. This article was originally published in The Conversation. www.unimelb.edu.au www.theconversation.com