What does the future hold for rail and Great Britain?

In a capacity constrained railway, where management of the assets remains a powerful contributor to train performance, juggling the value and impact of open access revenue and the potential of excess capacity remains a delicate task. Open access licences are being created because there is some room on the network. But just as slot allocations have different value at airports, the appeal of particular open access routes will vary.

Whilst open access passenger operators made up a small percentage (~2.5 per cent) of all GB train passenger KMs in 2023-24, this is increasing with long-distance journeys doubling in the last decade. Given that Lumo took over a nine per cent share of the London to Edinburgh east coast route, there is a strong argument that open access offers a real opportunity for new entrants. Freight open access that already makes up a quarter of all rail services could also offer an alternative opportunity for creating new economic value.

It is not as simple as ‘if you build it they will come’

Since Covid, the return of passengers to train travel has not been uniform and few trains are busier than in 2019. Individual services that are as busy or busier than pre-Covid are usually operating a reduced timetable or shorter train formations, rather than showing real growth in total passengers.

In comparison, freight has the potential to grow with the increase of to-the-door logistics. This has created demand for dedicated hub to city centre routes, served by scheduled light logistics freight services.

Where might increased access revenue come from? And what will provide the greatest value?

Across Europe, open access passenger players, particularly long-distance operators, are more common and are developing innovative services. A flight between Paris and Milan takes one hour 30 minutes and seven hours by high-speed train. Yet both the French TGV and Italian run Frecciarossa are successfully competing with one another on this route. This is an example of how passengers can be attracted from the airlines by offering a potentially faster end-to-end journey and increasing awareness of the options and choices available.

At the same time, light logistics services into the heart of cities, or further freight options that take goods off the roads, should be seen as ways to deliver an equivalent level of environmental (if not time to market) value.

Who pays, the fare payer, or the taxpayer?

As the government continues to seek to reduce public subsidy to the railway, the potential for open access to generate additional revenue is clearly an advantage. However, while passenger sensitivity to price will undoubtedly change, there will still be a need to spread the cost of running the railways to as many parties as possible, including the taxpayer.

How should we balance passenger vs freight vs fast freight vs deterioration

Every train that travels over the network deteriorates the asset and heavier trains and faster trains cause more damage. But those heavier, faster freight trains could actually release capacity and, with more trains running, there will be more revenue to
fund repairs.

This is the puzzle that modellers of train system capacity and asset managers will have to solve, all while addressing the ongoing challenges of inflation and extreme weather on works delivery and performance.

Within the open access licence debate, who is asking ‘what is the purpose of the railway?’.

As previously franchised operators come back into public management, it is easy to suggest that creating new open access licences will stimulate competition, customer centric services and innovation. However, it is clear that adding further services, without careful placement within the timetable risks adding further pressure to an already constrained and overextended system.

All that underlines the need for a debate about what purpose new licences or routes should fulfil. That means asking questions about the impact on capacity, reliability, performance and the cost of each of these, and, most importantly, who will fund those developments.

The jobs of the capacity planner, enabling freight and passenger movements across the network, offering services at times to suit those who want them, and that of the engineer and asset manager, enabling access to inspect and maintain the infrastructure have never been easy. The invitation to provide further open access licences may just have made their work a little bit harder.

This article was first published in Rail Professional.