8. Rail
The rail infrastructure component of the study has focused on two key elements of the rail network:
- The asset condition
- The service delivery
The majority of information recording rail asset condition is held by Tranz Rail. Sensitivities around this data mean that it has not been available to inform the infrastructure audit.
Hence the assessment of the current condition of the rail asset has been limited to a small number of previous studies and safety audits, the outputs from which are readily available in the public domain.
It should be noted that at the time of preparing this report, the rail sector is undergoing significant change. Toll Holdings Limited ("Toll"), an Australian transport and logistics operator, has acquired approximately 85% of the shares in Tranz Rail. Further, the Crown has entered into a Heads of Agreement with Toll to buy back track and associated infrastructure. The Crown is to establish a new entity that will own and operate the network. That entity will, in due course, acquire all of Tranz Rail's information about the network.
For the service delivery component, the work has focused on gathering readily available information to produce meaningful indicators. Because there is no up-to-date database available, it is difficult to obtain overall measures of the rail capacity. Much of the information has been provided by major users of rail services and other operators accessing the Tranz Rail network.
8.1 Summary of Key Issues
Recent safety reviews undertaken for the Land Transport Safety Authority (LTSA) conclude that the rail network is, in general, fit for purpose. However, concerns with deferred maintenance on parts of the network were noted. A number of considerations point to there being a significant deferred maintenance issue with the network including:
- Low and declining levels of asset replacement over the last 8 years
- The financial performance of Tranz Rail and its predecessor organisation which has resulted in the rail business falling short of being able to cover the replacement cost of its capital
- Comments made by some customers.
The quantity of freight being carried on the network has been increasing and stands at over 14 million tonnes per year. A number of growth opportunities have been identified relating to the coal, forestry, and dairy sectors, as well as container traffic. Potentially, these developments point to the need for investment in the network although, of course, they would need to be justified either in commercial terms or for public policy reasons.
In addition, there are some lines that are marginally viable from a commercial perspective but which might have wider economic and regional benefits. A regional summary of issues in this regard is provided below.
In addition to issues surrounding asset condition and service capability, there are also some policy issues surrounding rail and land transport generally. This includes funding issues (e.g. the framework for funding alternative to road projects) and pricing issues in relation to roads (which impact on competitiveness between road and rail) and access pricing for the rail network.
The Crown is soon to take ownership of the track and associated infrastructure which of itself raises a number of policy issues relating to the future governance and management of the rail network.
8.2 A Historical Perspective
Construction and development of the original railway network in New Zealand, began in the late 1800s.
The railway was operated as an integrated freight and passenger operation, controlled by the Railways Department until 1982 (rail ferry operations between the North and South Islands began in 1962).
In 1982 the Railways Department and the ferry service were reorganised into a Government-owned corporation (New Zealand Railways Corporation) which extensively restructured the operations to conduct business more efficiently.
In 1983, regulations governing the transportation of goods by road were removed. Since this time, the rail sector has had to compete against a fully deregulated road sector.
In 1990, New Zealand Rail Limited (NZRL) was incorporated as a limited liability company wholly owned by the Government in anticipation of the privatisation of its railway and other operations. The Government transferred all of its rail and other assets and related liabilities to NZRL. The Government retained ownership of the land on which the rail assets were situated and leased the land to New Zealand Rail. The lease has been managed by the New Zealand Railways Corporation (NZRC).
New Zealand Rail was privatised in 1993 and the new owners formed Tranz Rail Holdings Limited (the purchase price was $328.3 million including the lease of land).
In 2000 there was a significant restructuring of the business which included the outsourcing of core business functions, such as track and rolling stock maintenance. Specialist companies were contracted to provide these services from March 2002. In November 2001, the long-distance Tranz Scenic passenger service was sold to Australian-based rail operator West Coast Railway.
A new company, Tranz Scenic 2001 Ltd was formed to run the operation, with Tranz Rail retaining a 50 per cent stake in the business. That business runs the Northerner, The Overlander and the Capital Connection in the North Island and the Tranz Coastal and Tranz Alpine Services in the South Island as well as charter operations.
In December 2001 Tranz Rail sold the Auckland Rail Corridor to the government for $81 million, agreeing to continue running passenger services in Auckland until the contract expired in 2003. This contract has been rolled over to provide for a transition to a new suburban rail passenger operator in 2004.
As noted above, the Government has agreed to buy back the rail infrastructure from Toll. A new crown owned entity, TrackCo, is to be formed under NZRC to own and manage the rail infrastructure from 1 July 2004.
8.3 The Current Situation
8.3.1 Rail Asset Condition
In lieu of information from Tranz Rail, the condition of the rail network has been assessed based on a limited number of previous studies and other statistics in the public domain, together with commentary from a number of major users of rail services and other operators accessing the Tranz Rail network.
Based on these sources of information, a high level qualitative assessment of the rail assets condition, and suitability of historic maintenance, has been made. It is important to emphasise, however, that information held by Tranz Rail is needed to provide a more detailed assessment of the quality of the rail infrastructure.
8.3.1.1 New Zealand Institute for the Study of Competition and Regulation (NZISCR)
In a study of railways up until 1997 NZISCR found that despite improved operating performance under private ownership in the 1990s, including a productivity improvement of 30% between 1983 and 1997, the rail business had not been able to cover the replacement cost of its capital. Rail is a capital intensive business. Its replacement cost was estimated to be $1.5 billion in 1997.
8.3.1.2 Halliburton KBR Infrastructure Review
In 2002, LTSA commissioned Halliburton KBR to undertake an independent review of parts of New Zealand's rail infrastructure in the context of the transfer of its maintenance to Transfield by the rail operator. In its findings Halliburton KBR commented on the "fitness for purpose" of the rail network in terms of the network's suitability for safe operation as a railway, and its compliance with and maintenance in accordance with, defined minimum performance criteria. They concluded that:
While the overall definition of fitness for purpose is very general, the current network is being, and has been, operated as a railway for many years. There is no evidence to suggest that there will be such a rapid deterioration of the network that the railway becomes unsuitable for operations.
Procedures, standards and the overall condition of the infrastructure indicate that the network is fit for purpose.
There is evidence of deferred maintenance in the management of continuous welded rail (CWR) and related non-conformances.
The management and maintenance of joint elimination and the installation of CWR have been poor and have created a maintenance liability and a potentially unsafe rail condition during hot weather. This is being managed by the temporary imposition of speed restrictions during high risk periods.
More recently, Halliburton KBR have been commissioned by LTSA to conduct a more detailed independent review of rail infrastructure on the South Island coal route between the West Coast coal mines and Port of Lyttleton. The results of this review were not available for use in this audit.
8.3.1.3 Tranz Rail Operating Statistics
Table 48: Capital Expenditure in Infrastructure (1996-2003)| Capital Expenditure ($ millions) | 2003 | 2002 | 2001 | 2000 | 1999 | 1998 | 1997 | 1996 |
| Track and related structures | 22.0 | 19.2 | 20.0 | 17.8 | 39.4 | 62.0 | 38.0 | 30.9 |
| Rolling stock and equipment | 28.2 | 20.0 | 24.2 | 26.7 | 46.4 | 81.0 | 52.6 | 42.9 |
| Interisland ferry service | 4.6 | 2.0 | 1.9 | 1.3 | 23.3 | 31.7 | 15.6 | 3.4 |
| Other | 5.4 | 13.3 | 3.6 | 3.7 | 16.3 | 44.0 | 27.8 | 19.8 |
| Total | 60.2 | 54.5 | 49.7 | 49.5 | 125.4 | 218.7 | 134.0 | 97.0 |
Source Tranz Rail Annual Reports
Table 49: Key Capital Expenditure Statistics (1996-2003)| Key Capital Expenditure Statistics | Total | Avg | 2003 | 2002 | 2001 | 2000 | 1999 | 1998 | 1997 | 1996 |
| Sleepers installed (000s) | 606 | 75.8 | 20 | 42 | 42 | 45 | 102 | 140 | 133 | 82 |
| Track replaced (km) | 204 | 25.5 | 10 | 23 | 23 | 17 | 23 | 41 | 41 | 26 |
| Track de-stressed (km) | 1510 | 189 | 159 | 57 | 47 | 67 | 109 | 118 | 451 | 502 |
Source: Tranz Rail Annual Reports
Table 50: Tranz Rail Operating Data (1996-2003)| Operating Data | 2003 | 2002 | 2001 | 2000 | 1999 | 1998 | 1997 | 1996 |
| Total employees (average full time equivalents) | 2,960 | 3,757 | 4,122 | 4,194 | 4,521 | 4,698 | 4,645 | 4,780 |
| Freight: | | | | | | | | |
| Revenue tonnes carried (thousands) | 14,822 | 14,330 | 14,461 | 14,699 | 12,900 | 11,706 | 11,525 | 10,305 |
| Revenue tonne kilometres (millions) | 3,853 | 3,766 | 3,942 | 4,078 | 3,671 | | | |
| Passenger trains: | | | | | | | | |
| Tranz Metro (million passenger trips) | 12.3 | 12.3 | 12.2 | 12.1 | 11.4 | 11.3 | 11.1 | 10.6 |
| Tranz Scenic (thousand passenger trips) | 549 | 491 | 514 | 466 | 466 | 458 | 472 | 453 |
Source: Tranz Rail
8.3.2 Commentary
8.3.2.1 Asset Replacement
The data above indicates a low, and declining level of capital expenditure relative to replacement cost of the track and related structures, over at least the last 8 years. The New Zealand Institute for the Study of Competition and Regulation report would suggest that this has been the case for up to 20 years. ($20M capex/yr on a network valued at $1.5B in 1997)
A rail system can operate for fairly lengthy periods with low levels of re-investment. Further, safety can be maintained at lower levels of infrastructure condition by imposing operating restrictions (e.g. slower, lighter trains, different standards for different lines etc). A consequence of this is diminished service capability (e.g. longer travel times, reduced reliability, efficiency etc).
However, at some stage, major capital investment is required and the scale of this investment increases the longer the period before the replacement takes place.
The following is indicative of the backlog incurred over the last 8 years (based on a route length = 3807km). It needs to be noted that the rate of asset replacement varies according to track use implying considerable variation around the optimal length of replacement cycle. Lightly trafficked lines, for example, may be able to operate efficiently even with long replacement cycles.
- Sleepers replaced
There is a total of approximately 5.86M sleepers on the network (at 0.65 metre spacing, (mix of mainly timber and concrete))
- Track replaced
- At an average rate of 25.5km/yr over 8yrs = a replacement cycle 150yrs
- At an average rate of 18.3km/yr over 4yrs = a replacement cycle 208yrs
8.3.2.2 Rail Safety Outcomes
The LTSA has maintained a rail incident database to monitor rail safety performance since April 1993. There was an overall increase in the number of rail-related casualties in 2002/2003. There were 95 casualties compared with 57 during 2001/2002 and 98 during 2000/2001 (the details are set out in Table 51).
The number of rail-related casualties show random variability from year to year, with long-term trends difficult to predict because of the complexity of the casual factors.
There has been a decrease in the number of fatalities from level crossing collisions involving the occupants of motor vehicles, suggesting improved management of this aspect of the rail infrastructure. Tranz Rail and the roading authorities have been working together to improve road warning signs at level crossings.
Table 51: Rail Safety Outcomes for the 2002/2003 Financial Year| Incident Type | 1997 / 1998 | 1998 / 1999 | 1999 / 2000 | 2000 / 2001 | 2001 / 2002 | 2002 / 2003 |
| Fatalities | | | | | | |
| Level crossings - vehicles | 5 | 10 | 6 | 6 | 8 | 3 |
| - pedestrians | 2 | 2 | 1 | 2 | 1 | 2 |
| Railway staff | 0 | 0 | 4 | 0 | 0 | 2 |
| Person on tracks | 12 | 17 | 13 | 15 | 9 | 14 |
| Other rail incidents | 0 | 1 | 1 | 1 | 0 | 1 |
| Total | 19 | 30 | 25 | 24 | 18 | 22 |
| Serious Injuries | | | | | | |
| Level crossings - vehicles | 4 | 4 | 6 | 10 | 5 | 8 |
| - pedestrians | 1 | 1 | 0 | 0 | 0 | 0 |
| Railway staff | 0 | 7 | 4 | 4 | 2 | 7 |
| Person on tracks | 5 | 4 | 1 | 3 | 5 | 5 |
| Other rail incidents | 2 | 2 | 1 | 2 | 4 | 3 |
| Total | 12 | 18 | 12 | 19 | 17 | 23 |
| Minor Injuries | | | | | | |
| Level crossings | 12 | 10 | 11 | 363 | 1 | 7 |
| Other rail incidents | 19 | 23 | 38 | 19 | 21 | 43 |
| Total | 31 | 33 | 49 | 55 | 22 | 50 |
| Total Casualties | 62 | 81 | 86 | 98 | 57 | 95 |
Source: LTSA
We understand that Tranz Rail has data relevant to the safety of the rail infrastructure. This data has not been provided.
8.3.3 Customer Views
Based on discussions with a small number of major customers of Tranz Rail, several issues regarding the state of the rail infrastructure have been raised. It is difficult to verify the significance of these without recourse to data held by Tranz Rail.
There is a firm view among customers interviewed that the infrastructure has deteriorated significantly over the last 5-10 years. Some examples given include blanket temporary speed restrictions throughout much of the year due to risk of track buckling at relatively low temperatures. We understand that widespread speed restrictions were imposed by the LTSA because the Authority was not confident that Tranz Rail could accurately identify the shorter sections of track actually subject to heat buckling.
There was also a major effect on temporary speed restrictions on the South Island coal route for 4 months last year due to problems with bridges, which have been accelerated by the heavier axles loadings.
According to comments made in the public domain by Solid Energy, there is a backlog of deferred maintenance on the South Island coal route of up to $50M to give confidence for existing volumes (mainly structures & track, increased axle loads).
Other examples include slow repair of derailment damage and the length of time sections of track are under temporary speed restriction, routes unavailable for passenger charter trains due to lack of culvert clearances and formation instability and poor ride due to lack of tamping, rail wear, ballast deterioration etc.
8.3.4 Overall Rail Condition Summary
The New Zealand Institute for the Study of Competition and Regulation report in 1997 concluded that the rail business had not been able to cover the replacement cost of its capital, as far back as 1983.
Capital investment levels 1997 has been reduced significantly further, at the same time as tonnage levels have continued to increase. It would seem reasonable to conclude, therefore, that the current maintenance practices and renewal programmes have not been improving the performance of the rail infrastructure, and that overall the rail infrastructure condition, while generally meeting a "fit for purpose" test for current freight operations, requires significant investment to cater for the changing and growing freight and passenger demands.
8.4 Service Delivery
8.4.1 Theoretical Infrastructure Capacity
The capacity of a rail network is determined by the interaction between the infrastructure and the rail operation and systems operating upon it.
Theoretical capacity for rail freight on a route is limited by the physical infrastructure (which determines maximum weight/ axle loads, maximum line speed, curve speeds etc), whether double or single line, crossing loops (number of, length of, distance between), the type of signalling and the length of maintenance windows required.
The condition of the infrastructure has the potential to limit the capacity through speed and weight restrictions and increased requirement for maintenance windows.
In practice, however, the overall capacity is limited more by the markets the rail operator is supplying and upon the number of trained staff, the operating systems employed and the number and condition of rolling stock, wagons & locomotives, than by the infrastructure.
8.4.2 Demand
Rail freight tonnages have been over 14 million tonnes/year for the last 4 years. This includes 2m tonnes of coal, 0.6m tonnes of bulk milk and some 50,000 containers (TEU) transported between Tauranga and Auckland each year. The freight forwarding market increased 20% in the last year. Tranz Rail is negotiating with Genesis for contracts to transport 3m tonne/yr of coal from Tauranga to Huntly.
8.4.2.1 Regional Demand and Constraints
a) Northland
As with many other regions Northland is facing a "Wall of wood". The Northland region contains an exotic forest estate of 160,000ha, equivalent to 12.7% of the region's land area.
The volume of forestry wood flow in Northland (including Rodney District) is forecast to increase generally from 1.5 million tonnes per year in 2002 to 4 million tonnes per year in 2011.
The new deep water port at Marsden Point has been constructed to take advantage of, and enhance, Northland's economic growth prospects, especially in forestry. The new port could handle three to four million tonnes of forestry exports per annum including some from outside the Northland region. A laminated veneer lumber (LVL) plant has also been built at Marsden Point by Carter Holt Harvey to take advantage of the new port facility.
The major issue for rail in Northland is the lack of a rail access to Marsden Point. A link would enable the "wall of wood" to be railed at least part way to Marsden Point. From a purely commercial perspective, the link may not be justified. There may be wider economic benefits (regional and, perhaps, national) that need to be considered. Growth of rail transport from the south to Marsden Point would also require upgrades of the Auckland - Whangarei line. Integration with commuter services on the Auckland isthmus would also need to be considered.
Engineering design and an Alternative to Roading (ATR) funding application is in progress for a proposed 16km rail link to the Port from the existing rail network at Oakleigh. Whangarei District Council forecasts that the rail link will carry 1.2 million tonnes of logs per year, representing around 30% of the annual harvest in the next 6 years.
Most forests, with the exception of Mangakahia/Dargaville forests, are removed from the rail heads, with direct access to the Port via local roads and state highways. The use of rail generally involves road transport to rail heads at Otiria and Dargaville, additional double handling and relatively short haul rail from rail heads to port. The Mangakahia/Dargaville forests have access to the rail heads via a mix of forestry and local roads.
The last 20km of the Dargaville Line would need significant upgrade work to accommodate any significant increase in tonnage.
Reopening the line to Kaikohe, would compliment a new road bridge across Hokianga and would avoid, or lessen, the upgrade required of the road through the Mangakahia Valley.
The wood processing plants are generally not located on the rail routes. The existing rail wood chip shuttle from Portland to the Whangarei Port is at risk unless rail access is provided to Marsden Point.
Economic development and changing industry/ transport requirements due to the new deep water Port is likely to generate other traffic travelling further south (e.g. Inter Port container transport between Tauranga/Auckland/Northland Ports servicing Auckland via rail served inland Ports; fuel to Wiri and processed wood products).
Region wide transportation strategy studies commissioned by Northland Regional Council have been completed over recent years. These have recognised the strategic importance of the existing rail network in Northland providing a direct link to Auckland and points further south.
These studies recommend investment in the rail link to Marsden Point by 2005 as a strategy toward limiting the costs required to be spent on the roading network and toward preserving the existing Northland rail network. At the same time the rail link provides opportunities for future development of industries which would use rail transport and provides an opportunity for rail to become the prime mover of bulk cargo.
Auckland Regional Council Passenger services and freight access agreements are likely constraints to freight services from Northland especially during peak passenger times on the West Line.
b) Waikato
The North Island Main Trunk (NIMT) between Auckland and Hamilton is double tracked apart from a single line section through the Whangamarino Swamp between Amokura and Te Kauwhata (10km) and across the Waikato River at Ngaruawahia.
BHP steel mill at Glenbrook generates significant rail transport by way of export steel to Port of Tauranga, finished products throughout New Zealand and coal from Solid Energy's mines at Rotowaro and Kimihia.
Genesis Energy is currently transporting coal from Tauranga to its Huntly Power station by road.
This traffic is expected to grow to 3 million tonne per year. Proposals are being developed to provide additional rail infrastructure and load /unload facilities to enable this traffic to be transported by rail.
The track condition from Huntly to Rotowaro will need to be upgraded to accommodate these increased tonnages.
There is potential to increase axle weight on route between Glenbrook and Port of Tauranga (or even Auckland - Tauranga) for relatively small investment.
c) Bay of Plenty
Hamilton - Tauranga
The Kaimai Tunnel (8.9km in length) has experienced significant decay of rail and fastenings. This has been affecting speed, safety and ride through tunnel. Tranz Rail has been undertaking a significant ongoing project to address these issues. There is no ventilation in the tunnel other than at both portals, which creates an issue with exhaust gases for maintenance and operating staff and the potential for a passenger train emergency.
There are significant sections of timber sleepers with "A" type fastenings which have no plate under rail seat. These will require a significant programme of ongoing maintenance and/or renewal, especially where the track has been formed into Continuously Welded Rail (CWR).
Port of Tauranga
Port of Tauranga has wharves on both sides of the harbour. The rail link between them is not direct, having to deviate 12.5km via Te Maunga and through the heart of the Tauranga central business district (CBD). There have been proposals for a new combined road and rail bridge across the Tauranga harbour which would provide for direct rail access as well as open up the Tauranga CBD to the harbour but, to date, decisions regarding viability have yet to be taken.
Rail access onto, and standing room for wagons at the Port are limited, especially on the Mt Maunganui side. There have been proposals developed to relocate the rail yards at Mt Maunganui, which are limiting expansion at the Port, but decisions regarding viability have yet to be taken.
A log transfer station has been built recently at Kawerau, to enable logs to be stockpiled away from the Port and for shuttle trains to be used to transport logs to meet shipping schedules.
The Bay of Plenty forest estates and major processing plants at Kinleith, Kawerau and Whakatane are generally well served by the rail network, which has traditionally transported a high proportion of the logs and other forest products, both for export through Port of Tauranga, and domestically, throughout the country.
In the order of 50,000 containers per year are transported between Port of Tauranga and its inland port in South Auckland.
d) Mt Maunganui - East
There are lengthy sections of track laid with medium weight rail on the East Coast Main Trunk, in the vicinity of Matata. This restricts axle loads and speeds, due to a higher risk of rail fatigue.
e) NIMT Hamilton - Palmerston North
This section of the NIMT is single line, generally remote, with curves and grades which restrict speed and transit times.
The route was electrified (25kV) between 1986 and 1988. (409km route length, 475km track length). Power is fed to the system from 4 sub stations at Hamilton, Manunui, Tangiwai and Bunnythorpe. We are aware that the issue of whether the line should be de-electrified has been raised reflecting, at least in part, advances in diesel technology, plus the fleet management advantages of having a common locomotive fleet.
There are night capacity constraints, especially on the section north of Raurimu, which could be overcome with additional double track section(s) or passing loops which would enable trains to pass on the fly.
f) Okahukura - Stratford (Taranaki - Auckland Link)
This line links two other lines and is essentially a short cut. It has been maintained to a lesser standard, with tunnel clearance, speed and weight restrictions and is prone to slips, floods etc. There are formation and drainage problems in a number of tunnels.
The Marton - New Plymouth (MNPL) and Stratford - Okahukura lines provide an alternative route (albeit much longer, slower) for major disruptions on the NIMT between Okahukura and Marton.
g) East Coast
Gisborne Line
The East Coast area also faces a "Wall of wood" as for Northland.
However, due to the location of the forests relative to the rail and relative to Gisborne Port, the majority of the logs are not likely to travel by rail. Tranz Rail expects some growth in processed wood products and possibly some overflow tonnages of logs on the line.
The Gisborne Line is a long, winding route, prone to slips, wash-outs and floods. There is a significant back log of maintenance and renewal work, from earlier storms and deferred maintenance built up over many years. Significant expenditure is required on bridging. This was as a result of Tranz Rail's policy of essential maintenance only, due to the limited train services and very low levels of tonnage generated on the line.
Tranz Rail have indicated the company may close the line with next major flood event requiring any significant further expenditure on the line.
Transfund has allocated partial funding for the outstanding maintenance work, as the result of an application for ATR funding.
Napier - Palmerston North
Restricted clearances through the Manawatu Gorge tunnels limits the ability to transport 9'6 containers. The review understands from Tranz Rail that investment of the order of $8M is required to remove the restriction.
Whareroa - Stratford, Fonterra (Kiwi) Bulk Milk Shuttle
A bulk milk rail shuttle transports 0.6 million tonnes per year of bulk milk for Fonterra between Whareroa and Stratford.
Track condition on this section on the MNPL, combined with the greatly increased tonnage levels, has resulted in significant maintenance, renewal work in the off season, over recent years. The frequency of trains result in limited access for maintenance during the milk season.
Tunnel clearances in the Goat Valley tunnel limits the ability to transport 9'6 containers.
h) Palmerston North - Wellington
The route is double track between Wellington and McKays Crossing (41.8km)
Restricted clearance through Paekakariki tunnels have been increased to enable transport of 9'6 containers. This has largely been achieved through a short to medium term fix by using lighter weight rail.
Day-lighting these tunnels and double tracking would have significant benefits for Tranz Metro.
Passenger services are electrified to Paraparumu on the NIMT and Upper Hutt (& Melling) on the Wairarapa Line (1600v DC system, 95 route km, 170 track km). The system dates from the 1930s, with various upgrades over the last 50 years.
i) Wairarapa
The route is double track as far as Trentham and passenger services are electrified to Upper Hutt.
It provides an alternative route between Palmerston North and Wellington
The section of track north of Masterton is lightly used and has been maintained to a lesser standard.
j) Ferries
The rail ferries act as a rail bridge for rail freight across Cook Straight.
The timetables for ferry services, and the configuration of ships used, constrains freight/passenger movements, both rail and road across the strait. They also influence the timetabling of trains to meet the ferry connections. One issue raised by a shipping line was the potential for further reductions in speed limits in the Marlborough sounds, which are expected to reduce the number of crossings a vessel could make each day.
There have been proposals developed to shift the ferry operation to Clifford Bay. This would shorten the sea route and reduce the crossing time. It would also raise issues regarding the future viability of the section of line between Clifford Bay and Picton.
k) Christchurch - Picton
This is a single line route, with no alternatives, connecting Christchurch to the rail ferries.
The steep grade out of Picton limits the capacity of each train.
The proposal to relocate the ferry operation to Clifford Bay would eliminate the steep grade out of Picton and shorten the rail route, and hence the travel time between Christchurch and Picton.
l) Midland Line and West Coast Coal Route
Coal volumes on the Midland Line have increased from 0.2 million tonnes in 1976 to 2.1 million tonnes in 2003. Solid Energy's (SE) 15 year plan will see these volumes grow to 4 million tonnes per year by 2009. The strategy is to mine to the capacity of the transport infrastructure.
Tranz Rail own the wagons, with cost of the wagons amortised into the rate charged to SE through a long term contract.
Currently Tranz Rail is running 6 train sets of 24 wagons per day. 75% utilisation/performance of the infrastructure was achieved in 2000, 85% in 2002. The target for 2003 was 90%.
SE considers that utilisation can get to 95% by dealing with infrastructure reliability, temporary speed restrictions etc. before being constrained by weather and maintenance windows.
Investment is required in rolling stock. Deferred maintenance needs to be addressed to enable an increase in utilisation to 8-9 train sets of 30 wagons per day. This will assist in lowering SE's transport costs. SE has improved load out facilities (aerial ropeway), Lyttleton Port has reduced unload time from 2 hours to 1 hour (should also be achievable for 30 wagon trains).
Key issues with the South Island coal route are:
- Deferred maintenance is estimated at $50 million. The work, mainly to structures and track and to increase axle loads, is required to support existing volumes.
- Electrification back to Jackson would double the capacity of the Otira Tunnel.
- There are serious concerns regarding timber bridges being loaded at or above rated capacity and regarding the risk of track buckling.
- A number of grades need to be eased to allow an increase in train tonnages
- The Cobden Bridge is at the end of its useful life and needs to be replaced (SE estimates the cost at $10 million)
m) Canterbury/Otago/Southland
The Dairy Industry in the South Island has experienced rapid growth over recent years.
Limited rail access to the major processing plants has restricted the transportation of dairy products by rail. There is no rail access to Fonterra's largest factory at Clandeboye. Currently all products are transported by road, either direct to/from the site or in the case of product travelling by rail, transhipped at Tranz Rail's Temuka freight centre and road bridged to/from the site.
Recent and projected rapid growth rates at Clandeboye (currently around 19% per annum) are creating pressure on the road infrastructure used to service the site (both Local Roads and State Highways). There is still considerable scope for additional dairy conversions in the surrounding areas.
Fonterra propose to expand the capacity of the Clandeboye factory from the current 8.3million litres of milk per day to 14 to 15million litres/day by constructing a third milk powder plant at Clandeboye within the next 2 years and then construction of a fourth drier 2 years later.
Tranz Rail has worked with Fonterra and Timaru District Council over a number of years to investigate various solutions to directly rail serve the site, but have been unable to justify the significant investment required.
An ATR study, being commissioned by Environment Canterbury has progressed to full ATR funding application stage. The outcome will have a significant impact on transport throughout the South island.
Construction of a rail link into the Clandeboye site and improvements to rail access at Stirling and Edendale in Southland would open up the opportunity for similar bulk milk haul as the Whareroa to Stratford operation in the North Island as well as for inter factory transfers of bulk milk and other products. This project has the potential to remove over 24,000 heavy commercial vehicles (HCVs) from the region's roads each year.
There are currently significant tonnages of dairy products transported by road from Edendale and Stirling plants to Port of Otago and Bluff.
Otago Regional Council has commissioned a preliminary ATR evaluation of a proposed container transfer operation at Dunedin to take HCVs off SH88 to Port Chalmers. The project is to develop a rail-served container transfer facility in central Dunedin to serve as the "Port gate" for all containers travelling to/from Port Chalmers. The containers would then be transported between Dunedin and Port Chalmers by rail shuttle. This would have the potential to reduce the container truck movements on SH88 by 20,000 movements per year (14% of heavy commercial vehicle movements). The results of this study have yet to be released by the Otago Regional Council.
Forestry Products
Wood flow projections for the Otago/Southland region are for a modest rise to approximately 2 million tonnes per year. Almost all forestry products transported in the South Island currently go by road. Many of processing plants are not rail served, log transport is generally short haul to Port of Otago and Bluff and the forests are generally not adjacent to rail.
Otago Regional Council has commissioned a preliminary ATR evaluation of a proposed log transfer facility at Milburn and later in Alanton Forest on the Taeiri Gorge Line to take log trucks off SH88. This would have the potential to remove a further 11% of the HCVs off SH88.
The results of this study have yet to be released by the Otago regional Council.
Ohai Line
Any significant increases in coal and possible bulk milk transport by rail are restrained by the current poor track condition. There is significant maintenance/renewal investment required to upgrade this line.
8.4.3 Inter City Passenger Services
Tranz Scenic 2001 Ltd operate the following inter city passenger services.
Table 52: Tranz Scenic Inter-City Passenger Services| Service | Origin/Destination | Frequency | Seating |
| Northerner | Auckland / Wellington | 2 services nightly | 113-215 |
| Overlander | Auckland / Wellington | 2 services daily | 113-215 |
| Capital Connection | Palmerston North / Wellington | 2 services daily | 443 |
| Tranz Coastal | Christchurch / Picton | 2 services daily | 113-215 |
| Tranz Alpine | Christchurch / Greymouth | 2 services daily | Up to 512 |
| Charter operations | Varies | 50,000 train km/year | Up to 443 |
Source: Tranz Scenic
From a customer perspective, the main constraints to greater use of rail passenger transport are the frequency and reliability of services, station condition and access, limitations to the current network for passenger trains and the age of the rolling stock. Other factors include the relative cost of alternative transport forms, including private cars and, in the case of long distance services, the relative cost of aircraft travel.
The extent of speed restrictions and disruptions on the network have resulted in poor timekeeping performance for most services (over 33% of delays to Tranz Scenic passenger services for the month of September have been attributed to problems with the infrastructure).
The following figures for September 2003 illustrate the problem.
Table 53: Tranz Scenic Timeliness (September 2003)| Service | % on time
(< 10 minutes late) |
| Northerner (Nth) | 20% |
| Northerner (Sth) | 47% |
| Overlander (Nth) | 0% |
| Overlander (Sth) | 20% |
| Capital Connection (Nth) | 83% |
| Capital Connection (Sth) | 96% |
| Tranz Coastal (Nth) | 83% |
| Tranz Coastal (Sth) | 70% |
| Tranz Alpine (West) | 47% |
| Tranz Alpine (East) | 57% |
Source: Tranz Scenic
8.4.4 Suburban Rail Passenger Networks
8.4.4.1 Auckland Regional Rail Network (Ex Auckland Regional Council Transportation Plan)
Auckland currently has an extensive rail system with 92km of tracks and some 40 stations. The Eastern and Southern Lines form part of the North Island Main Trunk Line, which carries freight to and from the Ports of Auckland.
A recent audit of the network by the LTSA has concluded that the Auckland rail network is "fit for purpose" but substantial renewal works are necessary to retain network integrity and ensure public safety. Physical track and signalling constraints on the present network limit peak service provision to the current timetable. The quality of existing corridors, stations, rolling stock and service is a further inhibitor to attracting new passengers to rail, although the opening of the Britomart transport inter-change has led to material increases in rail passenger traffic.
The track was laid primarily for freight rail purposes and will need to be upgraded to accommodate the more intense usage and higher capacity requirements of a passenger transport system.
Currently there are 40 rail stations on the regional passenger rail network. All of the stations have only basic facilities and are generally below the standard expected for a modern passenger transport system. Some upgrading work has occurred, but the majority of stations suffer to some extent from poor shelters, inadequate lighting, difficult access, graffiti and other crime. However, in some cases recent moves to upgrade facilities are bearing fruit. Most notably, Swanson station has benefited from considerable community input and funding.
Currently, park and ride facilities at the stations are limited. The Western Line has about 90 spaces provided for park and ride commuters, while the NIMT line has about 500 spaces. At some major stations, such as New Lynn and Papakura, bus connections to the outlying suburbs are available adjacent to the station. But in general, there is poor coordination and integration of bus and rail services.
Tranz Rail was holder of an 80 year exclusive right of access to the rail corridors and owned all infrastructure within the corridors, including signalling and train control systems and equipment. The Crown has recently reached an agreement which secures access to the corridors for the region and transfers ownership of the rail infrastructure.
Connex has been chosen to run the passenger trains from July 2004.
Auckland Rail Passenger Patronage
Current rail services are limited, particularly in the off-peak periods.
Patronage has grown from 2.1m in 1996 to 2.2m in 2001. This is a compound annual growth rate of 0.9%. This low growth rate can be attributed to a lack of capacity in terms of both rolling stock and infrastructure. The current fleet of 19 Diesel Multiplies Units (DMUs) is unable to meet peak demand and a single tracked Western Line prevents any significant improvements in frequency past New Lynn.
Much of the current patronage is for non-CBD trips, with rail services providing a means of travel to regional sub-centres such as Newmarket, New Lynn, Henderson and Otahuhu.
As noted above, the opening of Britomart has increased rail passenger numbers.
The Vision for Auckland Rail
The Auckland Regional Land Transport Strategy (RLTS) outlines aims to generate 25 million rail passengers/year by 2015. It states that to achieve these aims, one of the requirements is a major upgrade of the existing Auckland Rail Network to increase capacity and consumer appeal. This upgrade is to include improvements to the network, modernising of stations and rolling stock fleet and improved frequency and convenience of the service, with particular emphasis to be placed on integrating the system with other regional public transport services.
The investments required in infrastructure to achieve these aims are described in the Auckland Passenger Rail Upgrades Project Business Plan (May 2003) and summarised in the table below.
They involve upgrading the core network to achieve a level of capacity and quality consistent with a modern rail system. Key initiatives include electrifying and double tracking the Western Line, electrifying the NIMT and Isthmus lines, construction of the Manukau Link and an upgrade of signalling on all lines. Stations will be refurbished to provide increased amenities (safety, access, parking, interchange facilities, retail services) and a new fleet of Electric Multiple Unit (EMU) rolling stock is to be procured.
Table 54: Proposed Auckland Passenger Rail Projects| Project | Estimate CAPEX
($M) |
| Initial Package - Priority 1 Projects | |
| Western Line Duplication | 59.4 |
| Newmarket Trackwork | 8.7 |
| Western Line & Newmarket Signalling Upgrade | 14.0 |
| Sub-Total | 82.1 |
| Package 2 | |
| Signalling Upgrade: South, East & Isthmus Lines | 33.5 |
| General Civil Works: South, East & Isthmus Lines | 9.5 |
| Otahuhu - Westfield Trackworks | 7.6 |
| Train Storage & Light Maintenance | 5.5 |
| Manukau Link | 40.6 |
| Priority 3 | |
| Electrification | 102.9 |
| Priority 5 | |
| Supplementary Signalling | 32.8 |
| Sub-Total Priority 2-5 Projects | 232.4 |
| TOTAL | 314.5 |
A further $2.5m of general work on track de-stressing is also required.
8.4.4.2 Wellington Regional Rail Network
Tranz Metro operates electric multiple unit rail passenger services to Paraparumu on the Western corridor (NIMT), Upper Hutt (& Melling) on the Hutt corridor (Wairarapa Line) and the Johnsonville line. The network and services are well established.
The Greater Wellington Regional Council (GWRC) is seeking to purchase the business or, if unable to do so, enter into a long term contract with the current provider.
Public Transport Service Patronage
Peak passenger numbers (all modes) have increased 3.8% (by over 600,000 people) in the past year, while off peak passenger numbers have increased by 5% ( by over 700,000 people). Buses account for most journeys by public transport (57% in peak periods). Rail journeys, which are typically three to four times longer, account for most passenger kilometres (71% in peak periods).
Over 60% of respondents to a Greater Wellington Regional Council perception survey in 2003, thought the rail network was reliable (bus 70%, road 60%), despite services being disrupted over summer because of the heat buckling problems.
8.5 Summary of Service Delivery Issues
The table below summarises the key issues affecting New Zealand's rail network.
Table 55: Key Issues Affecting New Zealand Rail Network | Issue | Implication |
| 1 | Containers getting bigger and heavier | Clearances of several tunnels need to be increased |
| 2 | Limited night time capacity on NIMT causing delays and reliability issues | Longer and/or more frequent crossing loops required |
| 3 | Steep grades on some routes limit the capacity of trains | Grade and curve easements would increase capacity, lower costs and improve transit times |
| 4 | Current maximum axle load on the infrastructure is 18tonne | Strengthening track and bridges would allow new high powered locomotives and bigger wagons to be used. |
| 5 | Control systems | Investment in new control systems would increase speed and safety and reduce costs |
| 6 | Container Terminals | More higher throughput container terminals with heavy lift facilities and paving would improve the reach on the system |
| 7 | Passenger lines limited | Investment would be required to return to full network availability for passenger services (e.g. Napier/Gisborne, Hokitika, Putararu to Rotorua) |
| 8 | Urban passenger rail | Refurbishment and/or replacement of rolling stock on Wellington regional rail network |
| 9 | Extensions to the Network | Various options for rail links to major industry e.g.
Marsden Point Port
Clandeboye Dairy Factory
Reinstatement of the line to Kaikohe |
8.6 Environmental Issues
Rail causes less environmental damage than road, including less land required, superior fuel efficiency, less air and water pollution, including less harmful particulate matter, and less intrusive noise. A recent European study found that overall, road freight's environmental costs were nearly four times those of rail, on a per net tonne kilometre basis. (Road €88/thousand tonne km versus rail €19) Air pollution was the most significant contribution where the ratio was 9:1 in favour of rail.
According to the UK Strategic Rail Authority, and based on studies by the former Railtrack, the value of rail external disbenefits is about one seventh that of road per tonne mile of freight.
The Commission for Integrated Transport reports in the study Incentives for Rail Freight Growth in April 2001 that moving freight by rail produces the following comparative non-user benefits:
- Energy Consumption: at least 50% lower than road transport
- Emissions: between 10% and 20% the level of road transport
- Accidents: less than 0.5% the equivalent rate for road transport
- Congestion: one train can carry the payload of up to 100 HGVs
On the negative side, there are a significant number of sites throughout the network, mainly at present or past mechanical workshops and rail terminals (where locomotives and diesel multiple passenger units stand), where the ballast has been heavily fouled by leaking hydrocarbons (diesel and lubricating oils).
In New Zealand, the Ministry of Transport has commissioned a major review of surface transport costs covering rail (and road). Environmental and safety-related costs are included within the scope of the review, the results of which have yet to be made public (and were not available at the time of preparing this report).
Notwithstanding the environmental and safety advantages of rail, it does not necessarily follow that rail is a more cost effective and sustainable option than road. The relatively low and sparsely distributed nature of New Zealand's population, coupled with its rugged terrain, count against the economics of rail. The outcome of the surface transport costs study may, however, have implications for the relative pricing of the two transport modes and, hence, over time, the proportion of total transport movements accounted for by each.
8.7 Policy Issues
There are several issues concerning the policy framework that could have an impact upon future investment in the rail network.
The Crown is shortly to take ownership of the track and associated infrastructure from Tranz Rail. The assets will then pass to a new entity - Track Co which will be part of the New Zealand Railways Corporation prior to becoming a stand alone entity that is owned by the Crown. Track Co will have responsibility for managing the rail network. The form and governance arrangements surrounding Track Co have yet to be determined. Moreover, funding arrangements for Track Co have yet to be announced. The decisions taken in these areas could have an impact on the approach which Track Co takes to investment in the network including, in particular, its approach to addressing the deferred maintenance issues noted above together with decisions in regard to marginal lines.
Track Co's decisions are also likely to be affected by the level of income it receives from track access charges that will be levied on Tranz Rail following the sale of track and associated infrastructure to the Crown. The Heads of Agreement negotiated between the Crown and Toll Holdings sets out a basis upon which track access charges are to be determined. Initially, these charges will be based on the cash expenses incurred in maintaining the existing network. Of itself, this will not provide sufficient income to address the deferred maintenance issues let alone further investment in the network. The Heads of Agreement also provide for the Crown to spend up to $200 million on capital works and Toll to invest $100m in rolling stock.
Under current policy settings, there is scope within Transfund's mandate to fund Alternatives to Roads (ATR) projects. A concern which has been raised in the land transport sector is that ATR funding focuses on savings to the road budget rather than a wider benefit/cost analysis which is the framework used for road funding. Potentially, differences in the funding frameworks affect the pattern of investment in roads versus non-road projects. The review understands that the framework for ATR funding is under a review.
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