Rail freight has been experiencing a marked renaissance over the past 15 years, growing in popularity as consistently as its steady decline in the 1960s and 70s, Marc Johnson reports.
More and more businesses continue to shift from road to rail, but motorways and HGVs are still moving most of the UK’s goods, with rail freight carrying around 10 per cent of all surface transport in Britain.
FTA research predicts that by 2030 that figure will look very different. In just over 15 years, 197.8 million tonnes of freight will be transported by rail compared to 123.7 million in 2006.
Those within the industry know that to deliver those growth projections, policymakers in Europe and the UK need to be receptive to the benefits that rail freight offers. Sadly for operators and distributors, not everyone is pulling in the same direction.
There is a lot of positive talk around the sustainable benefits of rail freight and the need for dedicated rail freight corridors but without a supportive organisation fighting the industry’s corner, it’s unlikely these discussions would develop further. The Rail Freight Group (RFG) was established to help move that debate along.
Says Maggie Simpson, executive director of the RFG, ‘The very early routes of the Rail Freight Group were pre-privitisation when a group of customers got together to try and improve the performance they were getting out of British Rail. But in the form it exists today it was founded in the early 90s, just ahead of privatisation.
As an organisation its aim is quite simple: to increase the volume of goods moved by rail, where it’s sensible to do that, through trying to create a policy environment that supports that aim. We’re principally focussed on the UK but obviously there is a strong interest in Europe firstly because European legislation sets out a lot of the framework we have in the UK but also because our member companies have business in mainland Europe and we want to help them to thrive in that environment as well.’
The Rail Freight Group, like many in the industry, hoped the Fourth Railway Package would support greater competition among freight operators in Europe. However, instead of ensuring all ties were cut between infrastructure managers and train operators, the EU appeared to submit to pressure
from Germany, opting against full separation for a holding model which some believe will allow anti-competitive behaviour to continue.
Says Maggie, ‘A lot of people believe that the model we have in the UK, where you have full separation from infrastructure managers and train operations, is the way you can most easily guarantee that you won’t get conditions where anti-competitive behaviour can exist.
‘Also the more you pull those organisations together the more difficult that becomes, so the original proposals had full separation and what actually got published was a holding company model in effect, with some protection around that.
‘It hasn’t got everything in it we would have liked to have seen but the trick now is to make what’s in there work and make sure it doesn’t get watered down anymore. There’s some really positive stuff in there for people who are looking to operate in mainland Europe, which should help.’
There are further pressures on freight operators in the UK market.
The Office of Rail Regulation (ORR) has only recently announced a new package of charges, which it believes will address an imbalance over infrastructure costs. The ORR has said that the higher charges will mean freight operators will contribute more to the £280-400 million worth of damage caused to Britain’s tracks by freight traffic every year.
‘At the moment we’re doing a lot of work on periodic review and the impact on freight charges for coal, biomass in particular but also some of the charges that apply across the piece,’ says Maggie.
‘I think in terms of the operators, to be honest, they are very concerned about the position with access charges and the implications that will have on their business, particularly coupled with a forecast decline in coal because of the environmental legislation relating to power generation.’
The industry’s growth and the undeniable need to move goods off the road and on to rail means there is plenty of good news out there.
Following the HLOS announcement last summer, Maggie spoke at the Rail 2020 inquiry about how the government’s £9 billion planned investment in the network would allow freight operators to develop their electric strategies, update their fleets, and move away from diesel-powered locomotives.
The RFG is also spending more time in discussions about innovation and improving not just the infrastructure but also traditional operating practices.
‘People are actively trying to push development. The supermarkets are looking to increase their involvement on rail and there are some good positive signs in interchange and terminal,’ adds Maggie.
‘Obviously there is research and development going on to try and reduce the cost of the rail network and that’s good for everybody. Electrification for example could benefit everyone.’
Rail freight’s renaissance looks set to continue as support for the industry gathers momentum.