The Anonymous Widower

Wonga Gets Its Calculations Wrong

I have just reread Some Financial Ramblings About Wonga, which I wrote in 2012.

This was a paragraph.

So this all makes me think that at some time, Wonga will be unable to sustain the current growth. Especially, if legislation to limit their interest rates of over two thousand percent was passed by parliament

The legislation didn’t happen, but publicity around a 2,000 percent interest rate didn’t help.

I used to part-own a finance .company and know from personal experience, that with such a company cash-flow is very easy to predict to the penny.

So when Wonga lost its sheen a few years ago, I suspect that the owners should have seen the writing on the wall.

Mathematics doesn’t lie!

But they didn’t and only last week, a group of mugs poured £10million on the fire.

 

August 31, 2018 Posted by | Finance | | 2 Comments

Financial Trouble At TfL: Can It Stay Afloat?

The title of this post, is the same as that of this article on Railway Technology.

This is the first paragraph.

London’s public transport provider, TfL, is under increasing pressure. Not only has its government operating grant been slashed but a funding freeze is also expected to cost £640m across the course of the current mayoralty. Can TfL create the commercial income needed to keep it afloat or are there serious causes for concern?

The government is cutting subsidy to TfL, but Sadiq Khan knew that when he stood for Mayor.

So what did he do? He offered a fare freeze until 2020.

It looks like more fantasy Socialist accounting to me, to ensure victory in an election.

The article also says this about the future.

Nevertheless, TfL’s hopes for the future are pinned on the completion of its upcoming Elizabeth Line project, scheduled for the end of the year. The £14.8bn project, which will create a brand new line running underground across London, is expected to be a big revenue raiser. TfL predicts that ridership will increase from the current 46 million passengers on TfL Rail, to nearly 270 million by 2022-2023.

If these predictions are wrong, TfL will be in trouble.

For myself, I suspect that Crossrail will suffer with its own version of London Overground Syndrome, with passenger numbers much higher than predicted. In The Scottish Borders Have Caught London Overground Syndrome, I talked about an outbreak in the Scottish Borders, after the opening of the Borders Railway, and said this.

This disease, which is probably a modern version of the Victorian railway mania, was first identified in East London in 2011, when it was found that the newly-refurbished East London Line and North London Line were inadequate due to high passenger satisfaction and much increased usage. It has now spread across other parts of the capital, despite various eradication programs.

But for the Mayor to rely on that, is clutching at straws.

May 15, 2018 Posted by | Finance, Travel | , , , , | Leave a comment

Eversholt Joins Very Light Rail Consortium

The title of this post is the same as that of this article on Global Rail News.

One of my previous clients; Cummins are involved. I used to provide analysis software for their factory in Darlington.

  • That factory, used to specialise in providing custom-built engines for smaller applications. So if say you wanted a diesel engine for a customised application, Cummins were the first place to go.
  • The factory was also geared up to making small numbers of these engines.
  • The company was very keen on getting quality right, which had actually led to my involvement.

I doubt Cummins would get involved in a project, that didn’t have a good chance of success.

I think the addition of Eversholt to the consortium could be beneficial.

Their traditional market is being eroded by new players looking for safe long-term investments funding some of the new trains.

But they have expertise in funding rail systems and Revelution VLR’s concept of very light rail running on a lightweight slab track could be something that they could fund, especially as a very light rail solution, must be cheaper than a traditional solution.

I shall be watching this consortium.

May 11, 2018 Posted by | Finance, Travel | , | 1 Comment

How The Class 717 Trains Are Financed

This is a paragraph in an article in Rail Technology Magazine, which is entitled Brand-New £200m Class 707s Undergo Testing Ahead Of Autumn Roll-out.

The 25 six-car trains, financed by Rock Rail Moorgate, will be the first to be introduced in the UK using a new model for financing rolling stock. In an unprecedented move, the trains will be financed through long-term investment from pension and insurance companies.

So many of us will own a portion of these trains, through our pensions and insurance policies!

May 2, 2018 Posted by | Finance, Travel | | Leave a comment

L&G To Build 3,000 Affordable Homes By 2022

The title of this post, is the same as that of this article on Construction News.

This is said.

Legal & General is to start building affordable homes with the aim of delivering 3,000 a year by 2022.

The firm said it will target affordable housing due to underinvestment in the sector.

L&G is aiming to become the “leading affordable housing provider in the UK” by drawing on its £15bn investment programme, according to chief executive Nigel Wilson.

It looks like the story could be better than the headline.

April 27, 2018 Posted by | Finance, World | , | 4 Comments

I’m Now Following The Queen’s Example

By Legend, the Queen never carries any cash.

I’m now deliberately following a similar policy, but I only use a contactless bank card for most of my daily purchases, like my paper and food.

I’ve even still got a couple of John Lewis vouchers gathering dust in my wallet, as sincve the new M & S Food opened in Dalston, I rarely go need a Waitrose.

One thing I find with M & S Food, is that on a typical purchase the average price is two pounds per item. So to keep under the thirty pound contactless limit, I rarely buy more than fourteen items. These unusually fit easily into usable bag.

Buying my paper in M & S or a station also means I can use contactless for the purchase.

A couple of days ago, I was approached by an aggressive tin rattler for a charity I would never suppose because of some of their practices. So I waved my card and asked. “Do you do conactless?” I got a smiling “Sorry! No!”

I still use cash for three purposes.

  • Restaurants with waiter/waitress service, so the tips go to the staff. It also means at busy times, in cafes I use a lot, I always get a table.
  • Black cabs, when I occasionally use one.
  • Personal services from local tradesmen, where the value is small. Otherwise it’s a bank transfer.

But it’s amazing, how little cash you now need.

 

April 25, 2018 Posted by | Finance | , , , , , , | 1 Comment

Break Free And Go Somewhere Better

This is a TSB advertising slogan and it looks like many of their customers will be doing this, after the fiasco of changing computers, reported in this article on the BBC, which is entitled TSB Online Banking Chaos Continues Despite Apology.

I would have left TSB immediately they were taken over by a Spanish bank, as keeping your banking details on a foreign server, exposes them to a whole new set of risks.

April 24, 2018 Posted by | Finance | , | 2 Comments

Charting An Electric Freight Future

The title of this post, is the same as the title of an informative article in the April 2018 Edition of Modern Railways, which was written by Julian Worth, who has many years experience of the rail freight industry.

This is a very comprehensive article looking at the future of motive power for freight trains.

These are points from the article, with some added comments of my own.

2040 And A Diesel-Free Rail System

Government ministers have said that by 2040, the UK will have a diesel-free railway, which will reduce emissions and especially particulates.

This page on the Government web site is entitled Let’s Raise Our Ambitions For A Cleaner, Greener Railway, which gives the text of a speech by the Rail Minister; Jo Johnson.

This is part of what he said.

And that’s why I am today announcing a new ambition.

I would like to see us take all diesel-only trains off the track by 2040.

If that seems like an ambitious goal – it should be and I make no apology for that.

After all, we’re committed to ending sales of petrol and diesel cars by 2040.

If we can achieve that, then why can’t the railway aspire to a similar objective?

Rail may be less carbon intensive than road transport.

That’s why modal shift’s so important.

As an engineer. I feel it is a challenge that is acceptable.

The Diesel Locomotives Are Getting Old!

The ubiquitous Class 66 locomotives, don’t meet the latest emission standards, but in addition, by the late 2020s, they will be getting to thirty years old.

Other locomotives like Class 59 locomotives will be even older.

Replacement locomotives will be needed, as maintenance costs will be getting too high.

The Last-Mile Electric Locomotive

Electric locomotives with a last-mile capability away from electrification like the Class 88 locomotive could be favoured.

  • They could be used for terminal work and short-distance movements.
  • They would have a 25 KVAC capability.
  • They could possibly have a 750 VDC capability, to work on the third-rail network.
  • They would meet all the emission standards, when running on diesel.

Julian Worth suggests that the last-mile capability could be provided by a battery.

Although, this would be environmentally-friendly and better in urban areas, I think that any onboard power, should be able to take a train into and out of the Port of Felixstowe, London Gateway and the other major ports.

I met a manager of the Port of Felixstowe a few years ago and they don’t like 25 KVAC wires in a dock, as containers do occasionally get dropped.

Most lines into ports and inland terminals, don’t appear to be too challenging and I’m sure that an uprated Class 88 locomotive could be built, that would handle entry and exit to all the ports and terminals in the UK.

Do We Need A Freight Electrification Strategy?

Julian Worth suggests we need one for the next couple of decades.

He makes some good points.

  • Electric traction current is cheaper than diesel fuel.
  • Availability of modern electric locomotives should be better than a diesel.
  • Diesels may be restricted in urban areas. It could be a vote winner in Mayoral elections in the large Metropolitan areas.

He finishes this with this statement.

Crucially, switching to electric locos from around 2030 would not entail premature replacement of the current fleet and would represent necessary asset renewal in modern equivalent form.

Just imagine the outcry from the Green Movement, if these ageing diesels were to be replaced with modern diesel locomotives..

Undoubtedly, we need a well-thought out freight strategy.

GB Railfreight

This article in Rail Magazine is entitled GB Railfreight In ‘Locomotive Acquisition’ Talks.

So at least one freight company is looking for new motive power. GB Railfreight has a fleet of seventy-eight Class 66 locomotives with other locomotives in the ageing category. Some of their work like hauling the Caledonian Sleeper needs well-presented reliable locomotives, so perhaps they need to update their image.

It will be interesting to see what type and class of locomotive they buy.

Rail Freight Has Changed

Coal to power stations used to be the dominant freight on UK railways.

But n0t any more! Thank goodness!

The major freight on UK railways is intermodal or trains of containers from port to inland terminal and vice versa.

There is also a large growth in construction materials, miuch of it going from quarries in the West Country and the Peak District to the South East of England. To send this any other way than by train, would surely be madness.

There also seems to be an increasing number of trains carrying new vehicles to and from the Continent. More will surely start to use the Channel Tunnel.

Julian Worth says this, after summarising the freight flows.

This suggests modest extensions of electrification might permit much of the construction and intermodal businesses, together with most automotive traffic, to be electrically hauled throughout.

He then goes on to say that the big gap is Felixstowe to Peterborough, Nuneaton and Birmingham.

The Port of Felixstowe

I partly grew up in the town and never thought the port would grow to the size, it is today.

I also remember in the 1980s, when only the odd intermodal train was to be seen on the Felixstowe Branch Line.

  • Now, a dozen trains in each direction on every day take the route between Felixstowe and the Midlands.
  • The Felixstowe Branch Line is being upgraded to raise the number of trains from the port from 33 to 48.
  • The Great Eastern Main Line and the routes through North London are close to capacity.
  • The direct route via Peterborough is a lot shorter than the London route.

Julian Worth states, that the number of trains between Felixstowe and the Midlands could rise to as high as fifty every day.

Routes That Should Be Electrified For Freight

Julian Worth suggests that the following routes should be electrified.

Route 1 – London Gateway to Thames Haven Junction

If you electrify Felixstowe to the Midlands, this will remove some diesel freight trains from London.

It would be stupid to replace them with diesel freight trains from London Gateway. So it would be fairly logical to electrify the connecting route to London Gateway.

This Google Map shows London Gateway and the rail connection to the electrified London, Tilbury and Southend Railway.

Note.

  1. The electrified London, Tilbury and Southend Railway, runs North-South at the extreme left of the map.
  2. The connecting spur curves East on what appears to be a new chord before accessing sidings on the North side of London Gateway.
  3. There would appear to be a lot of space to expand the port.
  4. The rail spur to the port is double track.
  5. It looks like their are sat least five sidings for handling freight trains.
  6. The sidings are double-ended, so last-mile capable electric locomotives could run round trains, without the need for electrification.

It would have appeared to have been designed for electrification.

Full details on London Gateway’s plans for rail access are given here in the Wikipedia entry for London Gateway, under Rail Terminal.

This is a quick summary.

In other places Wikipedia says the port is highly-automated.

I am led to the conclusion, that the Gospel Oak to Barking Line will see a high number of electric freight trains in the future.

I’m not surprised that Julian Worth says the spur currently handles sixteen trains per day and is set to grow significantly.

I certainly wouldn’t buy a house on the Gospel Oak to Barking Line.

Route 2 – Nuneaton To Birmingham Lawley Street

If Felixstowe to Nuneaton is electrified, then this extends the electrification to the massive Lawley Street Freightliner Terminal, which is in central Birmingham.

This diagram from Wikipedia shows the route.

Note.

  1. Lawley Street Freightliner Terminal, is on the short spur at the top of the diagram.
  2. iThis electrification would also complete a fully-electrified route between Birmingham New Street station and Sansted Airport, so CrossCountry could use electric trains on that route, instead of the current Class 170 train, which is often overcrowded.
  3. Would the electrification open up opportunities for more electrified local services in Birmingham?

Julian Worth says that this twenty miles carries thirty-two trains per day.

Would electrifying this route also have environmental benefits in terms of pollution?

Route 3 – Basingstoke To Southcote Junction and Oxford to Denbigh Hall Junction

This route, which connects the Port of Southampton with the West Coast Main Line, would require forty-two miles of electrification.

Consider.

  • It would create a fully-electrified route from Southampton to the West Coast Main Line.
  • Julian Worth says it carries forty-eight trains per day.
  • I also think, he is assuming that the Great Western Electrification extends to Oxford, which surely it will do in the next few years.
  • Dual voltage locomotives would be needed.
  • It would require electrification of part of the East West Railway.

The East West Railway is to be built as a privatised railway and I’m sure if the sums were right, they would electrify the route from Oxford to Denbigh Hall Junction.

If the Western end of the East West Railway were to be electrified, this must increase the options and operating speed for passenger trains on the route.

Route 4 – Merehead/Whatley to Newbury

Consider.

  • Merehead and Whatley are both Quarries of the Mendip Hills.
  • The line is double-track and seventy-two miles long.
  • Julian Worth says that this route carries twenty-eight stone trains per day.
  • Many trains are double-size.
  • In a four hour period, using Real Time Trains I found,three stone trains that weighed 4,800 tonnes and had a maximum speed of 45 mph and four stone trains that weighed 2,000 tonnes and had a maximum speed of 60 mph, using the route from the Mendips to London.

With all that heavy traffic, it strikes me that their are only two ways to power these trains on the route.

  • Very powerful diesel locomotives, possibly working in pairs.
  • Very powerful 25 KVAC electric locomotives, which would need electrification, able to supply lots of amps.

Mendip Rail currently run these services using Class 59 locomotives, which have the following characteristics.

  • Built in North America between 1985 and 1995.
  • They were the first privately-owned locomotives on the UK main line.
  • They have the ability to creep to shift heavy loads on gradients.
  • They have a maximim speed of 60-75 mph.
  • They are towered by a 2.5 MW diesel engine.

This extract from Wikipedia illustrates their power.

On 26 May 1991 Kenneth J Painter (59005) (with assistance from Yeoman Endeavour) set the European haulage record, with a stone train weighing 11,982 tonnes and 5,415 feet (1,650 m) long. However the so-called ‘mega train’ experiment was not very successful, as a coupling in the centre of the train broke.

It would appear, there was nothing wrong with the locomotives.

By the late 2020s, these locomotives will be over forty years old and although they could probably soldier on for another ten or even twenty years, the cost of maintenance will increase and reliability could decrease. You don’t want a 4,800 tonne stone train blocking the Reading to Taumton Line.

I suspect too, that it is unlikely that this important stone traffic will decrease. This is said in the Wikipedia entry for Mendip Rail.

Mendip Rail’s class 59s work services between various destinations which have changed over time according to demand and specific contracts. They have worked regularly over southern railway tracks, for example to the former Foster Yeoman terminals at Eastleigh and Botley, as well as delivery aggregates for construction work on the Thames Barrier, Second Severn Crossing, Channel Tunnel and most recently Heathrow Terminal 5, which required 3 million tonnes of stone.

Mendip Rail hauls about 4.5 million tonnes of stone from Torr Works each year, and about 2.5 million tonnes from Whatley Quarry.

I suspect that these stone flows will continue and there will come a time in the not-to-distant future, where new locomotives will be required.

  • The Class 59 locomotives were built for these stone trains and have a maximum tractive effort of 507 kN at just 7 mph.
  • A large electric Class 92 locomotive has a maximum tractive effort of only 400 kN.

But I suspect that engineers can design an electric locomotive, that can handle these trains either by themselves or working in a pair.

So there will be a choice between a very powerful diesel locomotive or a very powerful electric one.

  • Will those that live by the railway and environmentalists accept new diesel locomotives?
  • Electric locomotives would require the line to be electrified.
  • Electrification would allow Great Western Railway to run their Class 800 trains more efficiently using the wires.
  • Would those who live by the railway, accept the electrification of the line?

It’s a difficult choice.

Route 5 – Felixstowe to Ipswich. Haughley Junction to Peterborough and Helpston to Nuneaton

Consider

  • This would be a big project, as it would require 146 miles of new electrification.
  • But the return could be worthwhile, as currently the route handles twenty trains per day and once the Felixstowe Branch Line has more double track, this figure could rise to fifty-six trains per day.
  • At Ipswich, Peterborough and Nuneaton, the route connects to fully-electrified lines.

My project management knowledge tends to electrifying this line from East to West as almost three separate projects.

  1. Felixstowe to Ipswich
  2. Haughley Junction to Peterborough
  3. Helpston to Nuneaton

It could even be five, if Helpston to Nuneaton was split into two at either Leicester or the Midland Main Line.

I have three general questions.

  • When the gauge clearance was undertaken a few years ago, were bridges raised to accommodate wires as well?
  • Will the natives object to fifty trains per day?
  • Will the line be  resignalled to handle the greater number of trains?

Once the full route is electrified, the number of trains to and from Felixstowe , that used the Great Eastern Main Line and the routes through London would drop. Obviously, some trains like those between Felixstowe and Wales and the West Country would still need to use the London routes.

But overall, this would allow a mixture of the following.

  • Higher passenger train frequencies on the North London Line
  • Higher passenger train frequencies on the Gospel Oak To Barking Line
  • More freight trains to and from London Gateway could use the cross-London routes.

The last point would mean, that electric locomotives would need to have access to London Gateway.

I will detail my thoughts on Felixstowe to the Midlands electrification in the next three sub-sections.

Route 5A – Felixstowe to Ipswich

Electrifying between Felixstowe and Ipswich shouldn’t be the most challenging of projects.

  • The route is fairly flat.
  • The route is double track, except for part of the Felixstowe Branch Line.
  • The line was cleared for the largest containers a few years ago.
  • Doubling of the Felixstowe Branch Line around Trimley and the removal of some level crossings should start this year.
  • There should be an adequate 25 KVAC power supply at Ipswich.

I have two extra questions.

  • Will the partial doubling of the Felixstowe Branch, prepare the line for electrification?
  • Has a scheme been designed to take electrification to the port?

But there will be benefits.

  • Some freight trains that use the Great Eastern Main Line and the electrified routes through London, could be hauled all the way. by electric locomotives.
  • If Felixstowe station was to be electrified, Greater Anglia could run five-car Class 720 electric trains instead of Class 755 bi-mode trains on the branch, if required.
  • Class 755 bi-mode trains on the Ipswich to Lowestoft service, would be able to use the electrification between Westerfield and Ipswich stations.
  • Noise and vibration could be reduced.

It is just over a dozen miles of elwctrification, so isn’t the largest of projects.

Route 5B – Haughley Junction to Peterborough

Like the first section between Felixstowe and Ipswich, this section is also not very challenging.

  • The route is fairly flat.
  • The route is double track.
  • The line was cleared for the largest containers a few years ago.
  • Ely is being remodelled to remove a bottleneck.
  • Ely to Soham improvements seem to have been dropped, but will surely happen.
  • Haughley Junction needs to be remodelled.
  • Network Rail are already removing level crossings.
  • There should be an adequate 25 KVAC power supply at Haughley and Peterborough.

I have an extra question.

  • Will the route between Cambridge and Chippenham Junction be electrified?

But there will be benefits.

  • Electric freight between Felixstowe And The East Coast Main Line as far as Scotland.
  • Greater Anglia could run their service between Colchester and Peterborough with a Class 720 electric train.
  • Greater Anglia’s service between Ipswich and Cambridge would do more running under wires.

The electrification might even enable some useful electrified diversion routes.

Route 5C -Helpston to Nuneaton

I don’t know this section of the route, as well as I know the two other sections.

  • The route is double track.
  • There is a busy level crossing in the middle of Oakham.
  • There should be an adequate 25 KVAC power supply at both ends of the route.

It would appear that the route goes through Leicester station on the Midland Main Line.

As the electrification of the Midland Main Line has been postponed, how will this section of the route be handled?

But there will be benefits.

  • Electric freight between Felixstowe And The Midlands
  • Fewer freight trains would need to go via London
  • Some passenger services, like Birmingham-Stansted Airport, could be run using electric trains.

Completing all three sections will open up new possibilities for both freight and passenger services.

Route 6 – Hare Park Junction to Leeds Stourton

This is a freight route , which can be followed this way.

Electrification of this eighteen mile route, would allow freight trains with electric traction to reach the Stourton terminal.

The electrification could also be extended to Leeds station, so that passenger services on the Hallam Line, run by bi-mode trains would have an electrified route into Leeds.

Route 7 – Mountsorrel to Syston Junction and Manton Junction to Corby

Mountsorrel Quarry is one of the biggest granite quarries in Europe. It is not on the railway anymore, but is connected to the Midland Main Line at

Barton upon Soar, by a mineral conveyor.

These two short lengths of electrification connect Mountsorrel to the electrified portion of the Midland Main Line to London and by using the Felixstowe to Nuneaton route, there is access to the East and West Coast Main Lines.

Julian Worth says that thirty trains per day use the route.

Looking on Real Time Trains, they are not the mega-trains of the Mendips, but they seem to go all over England.

Route 8 – Whitacre Junction to Birch Coppice

Birch Coppice is a freight terminal and it is connected to the Birmingham Lawley Street to Nuneaton Line at Whitacre Junction, by a six mile rail link.

As in Julian Worth’s plan, the Birmingham Lawley Street to Nuneaton Line will have been electrified, it will be an logical section of wires to install.

Summarising The Routes

Summarising the routes, you get the following, once all the proposals are added to the UK’s electrified network.

  • There is a major East-West route from Felixstowe to Birmingham, that connects to the two major North-South routes; East and West Coast Main Lines and East Anglia’s Great Eastern Main Line.
  • The Reading to Taunton Line now provides an  route to the South-West for electric trains.
  • The massive quarries in the Mendips and at Mountsorrel are connected to the main electrified network.
  • The ports of Felixstowe, London Gateway and Southampton are connected to the main electrified network.
  • The inland depots of Birch Coppice, Birmingham Lawley Street and Leeds Stourton  are connected to the main electrified network.

Others may well be added.

For instance, an electrified connection to Liverpool2  along the Canada Dock Branch, which runs in places through densely-packing housing and has been looked at for a passenger service by Merseyrail.

Installing The Electrification

Traditionally, electrification schemes have been done using money directly from the Treasury.

To say, performance in recent years has been mixed would be an understatement!

With my experience of project management, I have my theories about the poor performance, but as I have no serious data to back them up, I will not put most of them in this post.

I will say however, that my observations of the electrification of the Gospel Oak to Barking Line have led me to the conclusion, that there are not enough competent engineers, surveyors and technicians to install the current low-level of new electrification.

However, recent statements and documents from Chris Grayling about how the Southern rail access to Heathrow is to be financed, might suggest a model for electrification.

This Press Release on the Department of Transport web site, starts with these two paragraphs.

Private companies have been asked to come forward with ideas to deliver a new southern rail link to Heathrow Airport.

The link will be one of the first projects under government plans to invite third parties – such as local authorities and private sector companies – to invest in the rail network, over and above the £47 billion the government is already planning for the next 5 years.

The idea is that a private consortium would do the following.

  • Design, build and finance a new line, station or other piece of railway infrastructure.
  • Maintain it for a number of years.
  • Charge train operators a charge for using the infrastructure, in much the same way as Network Rail charge every train for track access.

If the sums add up, I suspect it is model that will work for electrification.

I will take the Felixstowe Branch Line, that I know well as an example.

The benefits of electrification on this line could be as follows.

  • Freight trains from the Port of Felixstowe using electrified lines from Ipswich, could be able to use electric haulage, which might be more affordable.
  • Greater Anglia could run Ipswich to Felixstowe services using trains running solely on electricity.
  • There would be less pollution and possibly less noise and vibration.
  • Electrification might allow faster operating speeds on the branch, which in turn would allow more freight and passenger trains.
  • The hourly passenger service between Ipswich and Felixstowe might be able to be doubled in frequency.

Currently, after the dualling at Trimley has been finished, the branch is planned to handle an hourly passenger train and around fifty freight trains per day.

It strikes me that if the contracts and charges have the right balance, that a deal could be struck with a competent consortium.

It would have the following parts.

  • The consortium would design, finance and install the electrification.
  • Installing the electrification would be done, without disturbing the passenger and freight traffic.
  • The consortium would maintain the electrification for an agreed number of years.
  • Electrification access charges would be modelled on track access charges and agreed with a regulator, such as the Office of Road and Rail.
  • Failure to provide a working electrified railway, would incur penalty charges to operators.

I feel the model could work.

  • The consortium would use best practice from around the world.
  • The consortium might encourage innovative design and working.
  • The  consortium would make sure it had the best engineers, technicians and equipment to keep the electrification in tip-top condition, as that is the best way to maximise return on capital, against a fixed income.
  • The Office of Road and Rail would ensure safety, quality and reliability.

I also feel, that one of the ways to get the electrification installed in a professional manner and then operational at an agreed date, is to get the project management right.

Too much of what I’ve seen on electrification in the UK, reminds me of the phrase – It’ll be alright on the night!

A consortium, which has to raise and justify the money it needs, can’t rely on this mantra and must be sure that if a scheme is going to cost £100 million, then.

  • The initial budget must be correct.
  • The electrification can be installed for that sum.
  • Sufficient contingency is included.

Get the first project, seriously wrong and they won’t get another of the many electrification projects in the pipeline.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 25, 2018 Posted by | Finance, Travel, Uncategorized | , , , , , , , | 1 Comment

New Heathrow Rail Link To Lead The Way For Future Transport Funding Schemes

The title of this post, is the same as that of this Press Release on the Department of Transport web site.

This is the opening two paragraphs.

Private companies have been asked to come forward with ideas to deliver a new southern rail link to Heathrow Airport.

The link will be one of the first projects under government plans to invite third parties – such as local authorities and private sector companies – to invest in the rail network, over and above the £47 billion the government is already planning for the next 5 years.

In the past, I have talked about two privately-funded schemes for access from the South to Heathrow.

The Times is saying today, that it could be the second scheme.

But Heathrow can be such a money-earner, you do wonder if other schemes to serve the airport will be put forward.

How Would A Scheme Work In Practice?

A consortium consisting of engineering, financial and railway interests would put forward a scheme.

They would do the following.

  • Design the scheme and ensure it was acceptable to all stakeholders, including Network Rail, the Office of Rail and Road, local authorities, train operating companies, passengers, residents and in the case of Heathrow, the airport itself.
  • Raise the finance to build the scheme from appropriate institutions like insurance companies, banks and pension funds.
  • Build the scheme and get it approved by the appropriate companies, authorities and regulators.
  • Once the scheme is commissioned, trains using the scheme would pay appropriate track access charges, in the same way, that they do now, when they use Network Rail’s tracks.
  • Maintenance would be the responsibility of the consortium, that built the scheme.

In some ways the consortium functions like a mini-Network Rail, as it obeys all the same standards with regards to engineering and safety.

But.

  • The finance is not provided by taxpayers.
  • Any profits go to those, who conceived, built or financed the project.
  • Risks associated with the project are not borne by the Government or taxpayers.

If say in ten years time, the consortium goes bust, then I suspect that the assets would be bought on the cheap, by either Network Rail or another investor, who would learn from the original consortium’s mistakes.

Not that I think that will happen!

Has Anything Similar Been Done Before In The UK?

I think it is true to say, that various innovative ways have been found to fund railways in the UK.

The article from the Independent, which was written in 1992 is entitled Canary Wharf Banks Agree Funding For Jubilee Line.

This is a paragraph from the article.

The Government has always insisted that the scheme will not go ahead without private funding. In return for the financing, the banks are believed to be insisting that the Government chooses Canary Wharf as the site for the relocation of about 3,000 civil servants from the Department of Environment and the Department of Transport. It is also considering three other sites in the area.

So it looks like relocating three thousand civil servants got the Jubilee Line built!

Chiltern Railways have expanded by leaps and bounds over the years and some of their methods have been professional and innovative.

Project Evergreen with three phases has expanded and improved their passenger services.

This is an extract from the section of Wikipedia, that talks about the project.

Chiltern Railways former chairman Adrian Shooter said, “This is the biggest passenger rail project for several generations not to call on the taxpayer for support. Working closely with Network Rail, we are going to create a new main-line railway for the people of Oxfordshire and the Midlands. This deal demonstrates that real improvements to rail services can be paid for without public subsidy by attracting people out of their cars and on to trains.”

I don’t know whether this relates to all of Project Evergreen or just one part.

This is also said.

Network Rail provided the capital for the upgrade and will recover this through a facility charge over the subsequent 30 years, initially payable by Chiltern until its franchise expires, and then by the next franchisee. The infrastructure upgrade was carried out by main contractor BAM Nuttall, in partnership with Jarvis and WS Atkins.

It may all sound complicated, but Chiltern Railways is a train operating company that commuters don’t seem to complain about.

Could Any Other Schemes Be Funded Using The Department for Transport’s New Model?

Building the southern access into Heathrow Airport will be a large project costing more than a billion pounds.

But that doesn’t that all projects need to be that size!

I suspect, that the DfT’s model will be applied to some projects, as small as a hundred million pounds.

These are my thoughts on future projects, which I have split into various sections.

Airports

If a scheme like the Heathrow scheme  gets the go-ahead, then I think this could lead to other airport links being designed, funded and built using a similar model.

At present, Aberdeen, Bristol, Doncaster-Sheffield, East Midlands, Glasgow, Leeds and Liverpool airports are looking to improve rail access and the DfT’s model may be a way to build some, if the demand is there.

Network Extensions

The proposed Heathrow Southern Railway is effectively a well-thought out extension to three networks; Crossrail, Heathrow Express and South Western Railway to all of their mutual benefit.

I doubt there’ll be such big extensions, but there are some useful ones being planned.

  • Bramley Line -The track-bed of this route is still there and connecting March to Wisbech could create a new commuter route for Cambridge.
  • Fawley Branch Line – This would provide a passenger service and serve new housing developmemts in Hythe and Fawley.
  • Ivanhoe Line – Proposals to improve this service in Leicestershire with new stations.
  • Merseyrail Northern Line Extensions – The £300 million extension to Skelmersdale is being planned and another from Ormskirk to Preston is proposed using battery trains.
  • North Downs Line – This line could be updated to provide an improbred Reading- Gatwick. Would it make a freight route for Minis from Oxford to the Channel Tunnel?
  • Skipton To Colne Reinstatement – This  project of just a dozen miles is high profile amongst Conservative politicians and would provide another route across the Pennines.
  • West London Orbital – This £264 million extension to the London Overground would create two new lines in North West London.

This is by no means a complete list, but it shows how many routes could benefit with reinstatement or improvement.

Electrification

Why shouldn’t electrification be privately funded, with the builders and investors getting their returns, through an electrification access charge, which would be similar to a track access charge.

I discuss possible electrification schemes in Charting An Electric Freight Future.

The linked article is mainly about freight, but I suspect there are examples, where some shortish stretches of electrification could be privately-funded.

If electrification experts identified the problems of the past few years and how to solve them, there must be a case to formulate a business that merged engineering, finance and construction, that was able to install electrification on time and on budget.

Depots

Greater Anglia has commissioned a new depot at Brampton on a design, finance and build basis and it’s not the only depot built this way.

But that is more traditional financing.

Stations

The financing of some stations has been extraordinarily innovative.

I suspect that that some deals will get even more so.

Some will even charge for passengers per day.

Conclusion

One of the reasons, I like the DfT’s proposal of mixing design, finance and build with a good helping of innovation, is that this closely follows the model that we used with Metier Management Systems, when we started the company in the 1970s, to develop our Project Management system called Artemis.

  • We designed the systems.
  • We financed the systems.
  • We installed the systems
  • We maintained the systems.
  • The customers wanted the systems.
  • Customers paid so much a month.

The cream on top was the lashings of innovation.

There might be a lot of extra finance flowing into UK railways!

 

 

 

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March 20, 2018 Posted by | Finance, Travel | , , , , , , | Leave a comment

Thoughts On The National Lottery

The phone-in on BBC Radio 5 Live this morning is discussing the National Lottery.

I sent in this text.

The lottery, like religion, is just another way to extract money from the poor. If people need the buzz of gambling, there are much better ways of using sums of surplus money like local charities, crowd-funding bob-sleighers and peer-to-peer lending.

The lottery has served it’s purpose, but no politician dare kill it!

I doubt it’ll be read out!

January 24, 2018 Posted by | Finance, World | , , , | 2 Comments