an inland rail route between melbourne and brisbane? the north-south rail corridor study 14 june...
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An inland rail route between Melbourne and Brisbane?
The North-South rail corridor study
14 June 200714 June 2007BTRE Transport ColloquiumBTRE Transport Colloquium
Slide Slide 22
Structure of presentation
IntroductionTotal freight marketMode choice modellingAccess pricesPassenger market modellingProject outcomesAreas of future research
Slide Slide 33
The task
Background: freight growth, Auslink upgrades, lobbying for inland rail route
To consider options for the Melbourne - Brisbane rail corridor over the next 25 years
Consortium:
• Ernst and Young (project leader, financial anaylsis)
• Hyder (route options, other infrastructure, environmental)
• ACIL Tasman (demand, access prices)
Slide Slide 44
Analytical approach
• Identify current total freight market
• Forecast growth in total freight market for 25 years
• Determine current mode shares
• Estimate mode shares over 25 years and their sensitivity to changing service quality
• Estimate rail freight over 25 years
• Integrate with other models in consortium
Slide Slide 55
Path of far western route
Slide Slide 66
Slide Slide 77
Freight movements (excl. coal)
4.5m
4m
5.3m
10.3m
1.2m
2.9m
9.0m
9.2m
0.8m
5.1m
7.0m
19.3m
To/from WA & SA into NS Corridor
5.4m
Slide Slide 88
Analysis of base (2004)
• Origin - destination tonnages by commodity
• Data from rail operators, BTRE, ABS, FDF
• FreightSim for forecasting model. Structure: production, imports, consumption
• ACIL Tasman model of freight inducement effects
Slide Slide 99
Drivers of future demand
GDP growth (production, imports, consumption)
Transport freight to GDP growth ratio
• Growth of industrial concentration
• Growth of agricultural production
• Growth of imports, service sector
• Scenarios – High/medium/low GDP
– Growth transport/GDP ratio
Slide Slide 1010
New East Coast demand with an inland route
Coal in southern QLD, northern NSW
• But questions about which route, which port
Little else
Mainly a through route with a stop at Parkes
Slide Slide 1111
Freight diversion – northern NSW
27% of grain from Northern Plains to Brisbane from Newcastle
50% of cotton from Northern Plains to Brisbane from Port Botany
Brisbane-Perth freight via Parkes
No other material freight diversion
Slide Slide 1212
Future demand modelling results
-
5,000
10,000
15,000
20,000
25,000
30,000
2004 2009 2014 2019 2024 2029
Kto
nnes
Melbourne-Brisbane (case A) Melbourne-Brisbane (case B) Melbourne-Brisbane (case C)Melbourne-Sydney (case A) Melbourne-Sydney (case B) Melbourne-Sydney (case C)
Sydney-Brisbane (case A) Sydney-Brisbane (case B) Sydney-Brisbane (case C)
Slide Slide 1313
Road, rail, sea or air ?
Current market shares by mode
Drivers of mode choice
Sydney
Convenient departures
Logit model
Results
Slide Slide 1414
2004 snapshot
Current Rail mode shares
• Melbourne-Brisbane ~30%
• Melbourne-Sydney ~7%
• Sydney-Brisbane ~11%
Rail more price competitive on longer routes, less on shorter routes because of PUD time and costs
Rail outperformed by road in service quality
Slide Slide 1515
Mode performance 2004 – M to B
Road SeaRail
linehaulRail door to door
Relative price
0-20% above d-d
rail
20-40% below d-d
rail
30-45% below road
0-20% below road
Reliability 95% 90% 35-45% 35-45%
Availability 99% 10% 40-45% 40-45%
Transit time
21-27 hrs 3-3.5 days 36 hrs 42 hrs
Slide Slide 1616
Explanatory variables Price
• $/tonne (but complexities)
Reliability
• within 15 minutes of scheduled arrival time
Availability
• % of times the freight carrier is available within an hour of customers’ preferred time
Survey:
• how does demand for rail (at the expense of road) vary with changes in price, reliability, availability?
Slide Slide 1717
Reliability - problems in Sydney
Brisbane
Sydney
Trains traverse
the ARTC &
Railcorp
Network from
Melbourne-
Brisbane
(arrow does
not follow
actual train
path)
40% on-time reliability ( average for both
directions)
ARTC
Network
ARTC
Network
(exception of
north of the
Queensland
boarder)
60% on-time reliability
Melbourne
80% on-time reliability
Loss of 20% reliability in South Western Sydney
Loss of 50% reliability in Northern Sydney
30% on-time reliability
40% on-time reliability
RailCorp Network
Slide Slide 1818
Transit time & availability
0%
1%
2%
3%
4%
5%
6%
7%
8%
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Time of day
% o
f T
ota
l de
pa
rtu
res
pe
r h
ou
r
24 hour distribution of truck departures
2009
departure
time from
customer
Current
departure
time from
customer
Slide Slide 1919
Survey results – all customers
41%
21%
15%
10%
6%7%
Price Reliability Availability
Transit time Flexibility Loss/damage
Slide Slide 2020
Survey results - manufactured
51%
26%
23%
Price Reliability Availability
Slide Slide 2121
The manufactured market
Melbourne-Brisbane
Melbourne-Sydney
Sydney-Brisbane
Express freight 5% 5% 5%
Freight sensitive
to reliability and
availability
60% 70% 70%
Price-sensitive freight
35% 25% 25%
Slide Slide 2222
Mode choice
Logit model to predict modal shares
• Calibrated to explain current shares
• Forecast changes based on expected route characteristics– Price (incl fuel price, driver shortage)
– Reliability following AusLink upgrade
– Availability following AusLink upgrade
Key parameters estimated from
• Surveys
• Econometric analysis of past data
Slide Slide 2323
Logit model
Gives probability (%) of freight forwarder choosing mode n
Simple logit (two modes) formula
Where U is utility of using rail or road
• linear utility functions: constant + variable1 x coefficient1 +
etc
Slide Slide 2424
Logit model – hierarchical structure
• Logit model can be used at each level of the freight decision making process
• Nested logit useful for inland rail analysis
Slide Slide 2525
Values/inputs to use in the model
Current estimates of road and rail performance and mode share were derived from
• Rail operators, BTRE, ARTC, surveys
Future estimates of road and rail performance were derived from
• ARTC, BTRE, ACIL Tasman, Hyder, freight operators
Standalone road and rail freight pricing model developed
• Access prices, fuel costs, labour
Slide Slide 2626
Scenarios
Case A (reference), Case B (high rail), Case C (low rail)
Fuel price assumptions
Road and rail labour cost assumptions
Slide Slide 2727
Elasticities and coefficients
Price Reliability Availability
Melbourne- Brisbane -0.5-1.2 0.4-0.7 0.5-0.8
Melbourne-Sydney -0.7-1.15 0.3-0.7 0.08-0.36
Sydney-Brisbane -0.3-0.9 0.3-0.7 0.3-0.8
All routes -0.3-1.2 0.3-0.7 0.08-0.8
Slide Slide 2828
Testing of the logit model
Price (ave charge
$/tonne)Reliability
Service availability
Observed mode share
Road 186 95% 99% 30%
Rail 113 66% 80% 70%
• Observed performance (Melb-Perth 2000)
• Logit modelling of same input variables
Price (ave charge
$/tonne)Reliability
Service availability
Observed mode share
Road 186 95% 99% 27%
Rail 113 66% 80% 73%
Slide Slide 2929
Results – rail market share
Slide Slide 3030
Revenue maximising access charges
0
10
20
30
40
50
60
$0.00 $1.26 $2.53 $3.79 $5.05 $6.31 $7.58 $8.84 $10.10 $11.36 $12.63
Access charge ('000gtk)
Reve
nue
($ m
illio
n)
0% Efficiency gains 5% Efficiency gains 10% Efficiency gains15% Efficiency gains 20% Efficiency gains
Slide Slide 3131
Financial and economic results
Summary of results
Interpretation of results
Coastal route: problems and solutions
Inland route: problems and solutions
Full report including Ernst & Young and Hyder chapters not covered here, on www.aciltasman.com.au