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Network Rail Freight Network Study.

  1. Freight on Rail thanks Network Rail for the opportunity to comment on its Network Rail Freight Network Study (FNS).
  2. Freight on Rail, a partnership of the rail freight industry, the transport trade unions and Campaign for Better Transport, works to promote the economic, social and environmental benefits of rail freight to local, devolved and central Government in the UK and to the European Commission, Parliament and Council of Ministers.
  3. Summary
    The FNS recognises the value of rail freight to UK economy. It complements the DfT Rail Freight Strategy, which looks at how to maximise use of existing capacity, how to safeguard strategic capacity in the future and how to work with Network Rail to expand the network.

    Freight on Rail fully supports the central recommendation of the Network Rail Freight Network Study to continue upgrading the SRFN. The FNS states the following: The strategy focuses on developing capacity and capability primarily for intermodal traffic from the major ports and the Channel Tunnel to key terminal locations. In particular, the industry recognises the importance of capacity from Felixstowe and Southampton ports and on the Trans-Pennine, West Coast and East Coast routes as being key drivers for growth.

    The strategy creates a nationally cohesive freight network with complete ‘line of route’ enhancements to enable the forecast growth in traffic to be realised.

    The TfN freight strategy, for which Freight on Rail ran a rail freight workshop, highlights how the Trans-Pennine rail routes needs serious upgrades including electrification, to revive ports in the North.

    Allocation to freight of existing paths on the WCML when HS2 comes on stream is crucial if M6 corridor congestion is to be improved.

    In the context of Brexit, there is a strong case for upgrading rail freight links to ports and conurbations in the next Network Rail Control Period 6, to build effective trade links.

    The steep decline in coal traffic since the trebling of the carbon tax, first introduced in April 2012, makes government support for the industry all the more important if it wants to have an integrated robust multi-modal sustainable freight industry. The NR study identifies the key target capacity and capability priorities on the rail network to help keep the industry competitive.

    The DfT strategy supports the development of the Network Rail Virtual Freight Route (VFR), as recommended by the Shaw Review, which is vital to protect rail freight interests across the national network in the increasingly devolved structures. Clarity is needed on processes, governance, personnel and funding for the VFR. The Government and NR need to clarify how the interfaces with other routes be managed and who will decide on enhancements especially where there are conflicts with a geographically based route
  4. The rail freight operators have improved efficiency by increasing the length and capacity of trains where the network allows. It has also squeezed extra paths out of the network. For example, despite shortages of capacity on the Trans-Pennine route, GB Railfreight has secured extra rail slots to service its biomass services from the new Liverpool specialist biomass terminal to Drax Power station.
  5. Freight study findings in the FNS must be integrated in the Network Rail (NR) Route Studies and the DfT strategies.
  6. The case for expanding the Strategic Rail Freight Network  (SRFN)
    The strategic benefits to UK PLC of enhancing the SRFN recognised in the NR Freight Rail Network Study are also highlighted in DfT Rail Freight Strategy and the Arup report Future Potential for Modal Shift in the UK Rail freight Market reports issued in September 2016.

    Increasing rail freight volumes will help the Government achieve its policies to reduce road congestion and pollution and improve productivity. Rail freight is a crucial part of freight distribution with significant socio-economic benefits, as confirmed in this study and by the Government in its latest Department for Transport Rail Freight Strategy 1

    Road and rail complement each other so it is important that each mode plays to its strengths. Rail is well placed to offer the long distance trunk haul for consumer rail freight, as well as traditional bulk traffic having experienced sustained growth in consumer and construction markets. And critically, there is suppressed demand for more rail freight because of the lack of capacity.

    Suppressed demand for more consumer rail services
    As highlighted in the FNS study, rail freight is worth £1.6 billion per year to the UK economy 2. A quarter of consumer goods imported into the UK are transported by rail and this traffic can grow if there is more rail freight capacity on key corridors.

    Consumer and construction traffic growth illustrates the benefits of SRFN policy and makes the case for its expansion

    The Strategic Rail Freight Network Vision has resulted in sustained growth in deep sea intermodal services in recent years. Rail has an expanding consumer freight market, which grew 7% last quarter compared to the previous year’s same quarter – the highest level since 1998 3; it has grown by 30% in last 10 years and is forecast to grow fourfold by 2043 if the network is upgraded and additional road/rail transfer points obtain planning permission.

    The Hendy Review recognised that rail freight projects give significant socio-economic benefits to the UK. It stated that the average benefit cost ratio for rail freight schemes is between 4 to 5 1, Targeted investments work as the gauge enhancements out of Southampton port resulted in rail market share increasing from 28 per cent to 36 per cent within a year of completion. Financial analysis  £70.7 million project having a Net Present value of £376m
  7. Additional socio-economic arguments for further supporting rail freight
    Modal shift can reduce road maintenance costs
    Lorries are up to 160,000 times more damaging to road surfaces than the average car; some of the heaviest road repair costs are therefore almost exclusively attributable to the heaviest vehicles – 4th power law

    Environmental case
    Climate Change

    If the UK is going to meet its Climate Change targets to reduce CO2 emissions by 80% by 2050, measured against a 1990 baseline, road freight emissions are going to have to come down. In 2014 carbon dioxide emissions from transport went up from 25 per cent to 28 per cent. Surface transport emissions account for the vast majority (94 per cent) and of that HGVs contribute 17 per cent, despite making up only 5 per cent of road vehicles. Both passenger and freight rail together are less than 2 per cent. The Department for Transport is conducting a Freight Carbon Review to feed into the fifth Carbon Budget, of which increasing rail freight volumes is a key element.
    Air Pollution
    For the second time in 18 months the High Court ruled against the Government’s inadequate plans to combat air pollution, which are contributing to 50,000 early deaths and costing £27.5bn every year. HGVs, account for half nitrogen oxide road emissions on the Strategic Road Network, while only making 5 per cent of road miles driven in the UK. Rail, which produces almost 90% less PM10 emissions and up to fifteen times less NOX emissions than HGVs, can help alleviate this air pollution crisis, which is particularly dangerous in urban areas. London and Manchester are already exceeding their NOX emissions limits.

    Rail is safer than HGVs
    Overall road fatalities have reduced on UK roads; however the ratio of fatal road accidents involving Heavy Good Vehicles (HGVs) compared with those involving other vehicle types has been climbing year on year. The ORR states that rail is 20 times safer than road.

    In 2013, HGVs were six times more likely than cars to be involved in fatal collisions on minor roads. Source: Traffic statistics table TRA0104, Accident statistics Table RAS 30017, both DfT.

    According to the Government each road fatality costs society around £1.8 million

    Lorries only make up  around 5% of London traffic in miles driven but between 2010 and 2014, lorries were almost 10 times more likely to be involved in a fatal collision than cars.

    What road congestion costs the economy
    Road congestion is claimed to cost businesses £17 billion per annum. FTA 2015
    DfT estimate the cost of congestion being 99 pence per lorry miles on the most congested roads. Source DfT revised Mode Shift Benefit external costs values Dec 2014
    The distance travelled by HGVs increased by 9 per cent to 18.4 million vehicle km last year. HGVs occupy considerably more road space than, also need longer braking distances and are slower to manoeuvre and therefore cause more road congestion.  In congested conditions each single per cent increase in traffic causes several percentage increase in congestion. Conversely, Department for Transport figures state that a modest decrease in traffic of around 2%, results in congestion falling by 10%. So getting more freight onto the railways could significantly reduce congestion, especially on corridors with high volumes of HGVs such as M6, A14 and A34 where there are alternative parallel rail routes.
  8. Need cross modal analysis to reduce congestion on key strategic corridors
    CBT is undertaking research on behalf of the RIS2 team at the DfT to establish whether realistic growth in use of rail freight can have a significant impact on road traffic in key corridors and be used as input to investment planning for the RIS2 strategic network.  The early findings, in the box below, show the extent of the  potential, on key congested strategic corridors with high volumes of large HGV traffic, to shift significant numbers of containers to rail.

    Examination of the 2015 daily HGVs numbers on the A14 corridor shows the potential to transfer significant flows to rail with each train removing 77 HGVs from the route.

    A14 just outside Felixstowe: 4863 five, six and six + axle HGVs out of total of 5632 HGVs per day.

    A14 just West of Stowmarket:  3771 five, six and six+ axle HGVs out of total 5320.

    A14 West of Bury St Edmunds: 5191 five, six and six+ axle HGVs out of total of 7166 HGVs per day.

    5ax and above as % of all HGVs for the 3 sites: 86%; 71%; 72%.  As % of total vehicles: 16%; 12%; 12%. The preponderance of such large vehicles, 5, 6 and 6+ axle HGVs, prime target for transfer to rail, shows the potential to shift to rail on this corridor.

    M6 corridor analysis shows 9500 five, six and six+ axle HGVs on the route per day. Upgrading the WCLM and allocating sufficient released HS2 paths to freight would significantly reduce these figures. 

    Annual Average Daily Flow divided by 365

  9. Changes in urban logistics patterns and wider devolution make rail’s case strongerWider devolution and city mayors for large cities like Manchester and Birmingham should result in more powers to decide their own priorities and regulations like London and lead to more integrated multi-modal freight policy. In fact, rail can offer the safer more sustainable long distance trunk haulage element of consumer urban deliveries for onward transhipment into low emissions vehicles, if consolidation centres and terminals are rail connected. During peak hours freight related vehicles account for a third of the traffic in London and at the same time Government figures show that nationally almost 30 per cent of lorries are driving around completely empty illustrating why action is needed to address road freight’s efficiency, congestion, safety and pollution impacts.

    Another complementary option is using passenger rail terminuses, which are closed between 1-5am each night, for trainloads of freight deliveries, into the heart of cities. Two successful rail freight trials into Euston for TNT and Sainsburys showed the merits of bringing in a freight train, into urban centres with low emissions vehicles performing the final delivery. Rail currently delivers 40 per cent of aggregates to the capital and has the potential to increase this market if more urban terminals can be built. Rail was used extensively to build the Olympics, Crossrail and Terminal Five Rail to deliver the construction materials and removed the spoil.
  10. Terminals coming on stream will support rail freight growth
    Strategic Rail Freight Interchanges (SRFIs) are an intrinsic element of shifting more freight to rail as they enable rail to compete with HGVs by reducing the transhipment costs between the modes and offer added value services such as warehousing. For example, the SRFI at Daventry in Northamptonshire removes 23 million lorry miles each year, mainly off the congested road network. Daventry has shown that interchanges can generate rail freight traffic and local employment without problems on the local road network.

    The Government’s National Networks Policy Statement NPS’s clear explanation of the need for SRFIs in its SRFI interchange section has and will continue to be important in giving the private sector confidence to invest in terminals. The growing number of proposals such as East Midlands Airport, Etwall Common near Derby, I-Port Doncaster and Four Ashes near Stafford demonstrate that this supportive Government transport and spatial planning policy has contributed to private sector confidence to invest.
  11. Detailed case for continuation of the DfT Strategic Freight Network
    The Network Rail study sets out the short-term priority schemes 4 which we ask the Government to support because there is suppressed demand, for consumer rail freight services in particular, because of the lack of rail capacity, as explained in sections below. Therefore we urge the Government to upgrade key elements of the Strategic Rail Freight Network to build rail freight infrastructure providing a robust and reliable service for freight customers.

    Potential on Felixstowe to the North Corridor
    For example rail already has 28 per cent of the modal share out of Felixstowe with 33 daily rail services in and out of Felixstowe port to the north; customers want more rail freight services so every additional rail slot which comes free on this key strategic freight corridor can be filled straight away. As part of the current CP5 HLOS upgrades, Network Rail is upgrading the Felixstowe branch line which will provide an additional ten paths. However, further upgrades along the rail corridor to the North, as yet unfunded, could remove 40 million lorry miles from the A14 corridor.

    Southampton Port
    - the electric spine upgrades would increase capacity and reliability enabling rail traffic to expand. Rail currently has 38% of containers and 25% of cars are transported out of the port.
  12. Lack of level playing field between rail and HGVs makes it hard for rail to compete
    Currently, there is market distortion between rail and HGVs because of the level of HGV subsidy which makes it hard for rail to compete. Government needs to compensate rail freight, which imposes far less adverse costs on the economy and society in terms of road congestion, road collisions, road damage and pollution (ie rail external costs ten times less than HGVs), for the £6.5 billion per annum HGV subsidy so it can compete to reduce road congestion and collisions and at the same time improve productivity.

    Government figures 5 show HGVs are only paying 30% of the costs they impose on society in terms of road congestion, road damage, road collisions and pollution.

    Mode Shift Benefit Grants
    Rail freight annual grantsof £16m per annum, which are paid in recognition of the economic, safety and environmental benefits of removed HGVs, represent excellent value for money with ratios of around 4 and 5:1. These grants are crucial to the industry.

    However,the Government needs to do more to overcome the lack of parity between HGVs and rail freight.
  13. How Government can compensate rail freight for lack of parity with HGVs
    a) Commit to upgrade Strategic Rail Freight Network in CP6 so that suppressed demand for rail freight services can be transferred to rail to reduce congestion, collisions and pollution.  The Network Rail study 6 sets out the short-term priority schemes.

    Take into account the market distortion between rail and HGVs, as explained in paragraph above, in the forthcoming ORR PR18 review of freight access charges so that rail can compete with HGVs.  If freight access charge increases result in trainloads of freight transferring back to HGVs, the extra congestion, road collision and pollution costs will have to be met by the Government, as spelt out in the DfT Rail Freight Strategy paragraphs below.

    135 - At the same time, we recognise the positive benefits of rail freight for the UK – including its environmental and air quality benefits relative to road freight and its impact on reducing road congestion. These benefits are not currently recognised in the track access charging regime. A significant increase in track access charges could result in some freight moving from rail to road, resulting in the associated economic and environmental benefits to the UK being lost, particularly for those commodities where rail freight is in direct competition with road and operators therefore have a limited ability to pass on any increase in costs to their customers

    136 As set out in the Secretary of State for Transport’s guidance to ORR in July 2012, in setting track access charges we would expect ORR to note the Government’s rail freight policy including the importance of sustaining efficient and commercially predictable network-wide freight operations. The guidance to ORR also notes that the Secretary of State wishes to be advised by ORR of, and to discuss with ORR, any changes to the charges which ORR proposes to pursue which would adversely affect the competitiveness of rail freight compared to other modes.


  1. DfT Rail Freight Strategy September 2016
  2. RDG Keeping the Lights on and the Traffic Moving
    RDG Freight Britain
  4.  summary Table 2 & Figure 2 P9/11
  5. Mode shift benefits values Dec 2014
  6.  summary Table 2 & Figure 2 P9/11

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