High Speed rail – challenges & options: indian perspective

Report
HIGH SPEED RAIL – CHALLENGES &
OPTIONS: INDIAN PERSPECTIVE
February 01, 2013
Vinay Kumar Singh
GM (PP&D)
Rail Vikas Nigam Ltd.
1
CONTENTS
I. Need of High Speed Rail in India
II. Key Issues and Challenges
III. Implementation Options
2
WHAT IS HIGH SPEED RAIL?
 As per UIC definition, trains running at speed of 200 kmph on
upgraded track and 250 kmph or faster on new track are called High
Speed Trains.
 These services may require separate, dedicated tracks and "sealed"
corridors in which grade crossings are eliminated through the
construction of highway underpasses or overpasses.
3
WHY HSR IS REQUIRED IN INDIA ?
4
ENERGY EFFICIENCY
High Speed saves Energy Costs and reduces Greenhouse Gases
Plane
51.1
Private Car
29.9
Bus
18.3
Classic Train
17.6
High Speed
Railway
12.1
0
10
20
30
40
50
“Fuel equivalent grams” per passenger-kilometer
60
LAND REQUIREMENT
Land requirements are Smaller
A HSR-line allows more passengers than an six lane highway per hour
Elevated rail corridors reduce the hassle of Land Acquisition.
35 m
DECONGESTION AND CAPACITY ADDITION
High Speed Rail
Motorway
Double Track
2x3 Lanes
12 Trains per hour per Direction
4500 Cars per hour per direction
1000 Pax/Train
1.7 (Average) Passengers per car
Capacity = 12000 Passengers Capacity = 7650 Passenger per
per hour
Hour
Reduction in commuting time between cities and added capacity gives an
excellent opportunity for decongestion of the mega urban centers and
growth of smaller towns and other cities.
INCREASING URBANIZATION
The major challenges faced are:
 Major Urban centers are severely
congested:
700
 Dramatic growth in vehicle
ownership in the past
decade.
500
 Accessing jobs, education becoming increasingly timeconsuming.
200
 Billions of man-hours are lost
with people stuck in traffic.
590
600
473
377
400
300
285
100
0
2001
2011
2021
2030
Urban Population in India (in Million)
INCREASING URBANIZATION
Explosion in Inter City Travel
India’s urban population - 285 million
reported in the 2001 census and 377
million in 2011 census.
McKinsey Global Institute (MGI)
projects - 590 million by 2030 (40%
of India’s total projected population).
The rapid urbanization in the country
has triggered a growing demand for
inter city traffic between metropolitan
cities and 2nd and 3rd tier cities.
In absence of HSR, passenger traffic
of Airlines/ Car users is growing at 1520%
DECONGESTION of Metropolitan cities
Tier II city
Tier I
Tier
City II
Tier I
City
Tier
II
city
Tier I
City
Small towns and Tier II & III Cities
TRAVEL TIME ( Trigger for modal shift)
Journey time for air travel involves travel to airport, away from city centers and waiting
time at Airports. Distance between DELHI to CHANDIGARH is 245 Km.
Chandigarh
Airport
(city centre)
Delhi
Delhi Airport
(city centre)
Plane
.75 hr
1.25 hrs at Terminal + 1 hr Flying time
30 min
Total time: 3.5 hrs
Chandigarh
(city centre)
Delhi
(city centre)
Total time: 1 hr
High Speed
Railway
NEED FOR HSR IN INDIA
HSR is energy efficient and is less polluting than Road/Air travel.
Indian imports about 80% of its oil requirement. HSR will use
indigenous energy resources like thermal/hydel/nuclear based energy
Economically as well environmentally, Rail based Transport
system is ideally suited for India.
IMPACT OF INTRODUCTION OF HSR
Introduction of
TGV service in
1981-83
 Existing long distance rail services have difficulties
in competing with road and air modes of transport,
 The new HSR lines can stop the decline of the
railway’s share on the long distance transport
segment along those corridor.
 It provides an attractive transport offer in terms of
reduced travel times and comfortable journey.
 Despite the high investment cost it is economically
sustainable and need of the hour.
Evolution of first Class rail traffic in France
Before and after opening of the first HSR line
14
KEY ISSUES & CHALLENGES
15
KEY ISSUES & CHALLENGES
(7) Selection of
Technology
(6) Policy Framework
(1) Political Will
(2) Selection of
Project Corridor(s)
System
Integration
(3) Economic &
Financial Viability
(5) Land Acquisition
(4) Financing
HSR Project(s)
High Speed Rail
Development
16
(1) POLITICAL WILL
 Each HSR corridor will have a long gestation period and
will be highly capital intensive, so, strategic thinking is
required at the Apex level for implementing in a
programmed manner
 Coordination among Central Government Ministries, State
Governments and Government Agencies
Success stories- National Highways, Airport up-gradation,
Yamuna express-way
17
(2) SELECTION OF PROJECT CORRIDOR(S)
FOR IMPLEMENTATION
 Vast country – Many potential corridors - Selection of
pilot Project;
 Economically/financially viable projects to be given
priority;
 Willingness of local governments to participate in the
project by way of land and funding support.
18
(3) ECONOMIC & FINANCIAL VIABILITY OF THE
PROJECT
 High capital cost will impact viability
 HSR will be a dedicated line; High demand risk due to
higher tariffs as compared to conventional rail.
 Emphasis on other alternative revenue sources like Real
estate revenues, carbon credits, cross-subsidy from road/air
travelers.
19
(4) FINANCING OF THE PROJECT(S)
 The high capital costs of HSR makes it a financing
challenge.
 GOI may not fully fund the corridors.
 Most state governments will have to raise finances by
extra levies, real estate etc. even for part funding
 Private sector may not have adequate financing
capability to fund the large HSR projects. Proper project
structuring by unbundling the projects into smaller
packages may be essential.
Funding by multilateral and bilateral funding agencies
20
(5) LAND ACQUISITION
 Critical due to stringent alignment requirements
 HSR corridors pass through conurbations or sensitive
land;
 Strong public protests adversely affecting large number
of projects.
Mix of alignment choice- grade/ elevated/ tunnels
21
(6) POLICY FRAMEWORK
 Robust policy framework for:
 Seamless implementation of projects
 Assurance for attracting International investors
 Creation of National High Speed Rail Authority
22
(7) SELECTION OF TECHNOLOGY
Choice of Technology:
A) Fixed Infrastructure:
 Mix of Embankment/Elevated/ Underground Structures and
their dimensional control;
 Construction Gauge;
 Fencing of the complete track/elevated track;
 Electrical Installations.
B) Fast Upgrading Technology
 Rolling Stock
 Signaling and Communication
 Train Control
 Fare Collection
23
IMPLEMENTATION OPTIONS
24
INTERNATIONAL CASE STUDIES
25
TGV, FRANCE
The rolling stock for the
TGV lines is procured
by SNCF and is funded
through lease
commitments
French Govt.
The first opened in 1981
between Paris and Lyon
(480 Km) and now total
network 1887 km. French
govt. plan to have new 2000
km HSR lines by 2020.
Borrowing from the
international markets to
enable it to undertake
major projects but not on
a particular project
basis. This funding is
supported by
government guarantee
but is restricted to the
amount that RFF can
repay from the access
fees
Access Charges
(for use of rail infrastructure)
SNCF - French
national rail operator
Réseau Ferré de France
(RFF) – State owned
26
TGV, FRANCE
 In addition to borrowings, the TGV lines have also been developed with grant
funding from local sources. Funding pattern for three TGV lines are:
Funding by Source
French State
Regional funding
RFF
SNCF
EU
Luxembourg
Switzerland
TGV Est
39%
24%
22%
2%
10%
4%
n/a
East Rhine Rhone
31%
29%
26%
4%
8%
n/a
3%
Concession model
► Rail operators pay an
access charge based on
their actual use of the
infrastructure
► Demand risk lies with
the concessionaire
Brittany loire
32%
35%
33%
n/a
n/a
n/a
n/a
Partnership contract
Forms of PPP
models
followed by
RFF to create
Infrastructure
27
►RFF pays a rental or
availability fee based on
the performance of the
private sector partner
► Demand risk remains
with RFF
HSL ZUID, NETHERLAND
Dutch govt –
6 D&C contractors
Substructur
e
Rail
Systems
Infraspeed Consortium: Fluor Daniel
BV, Koninklijke BAM/NBM Amstelland
NV, Siemens Nederland NV, Siemens
Transportation Systems, Innisfree
Limited and Charterhouse Project
Equity Investment Limited
30 years Concession on DBFM (PPP)
basis
• 125 km line between the
Netherlands (Amsterdam)
and Belgium border
(Schiphol).
• This lines provides
connectivity of Amsterdam
to Brussels and Paris
Passenger
Transport
HSA
28
Network
Connectio
ns
One D&C
contractor
HSL ZUID, NETHERLAND
The PPP did not include the transfer of any demand risk. Infraspeed is
remunerated on an availability basis, subject to deductions for unavailability of
the infrastructure.
The Dutch government finances:
 The substructure of the HSL
 The PPP infrastructure payments to Infraspeed
 These are partly financed by revenue from HSA Total costs: €7.2bn.
The value of the PPP element of the project was approximately £1bn. The £1bn
project financing for the PPP includes:
 €605m syndicated term loan (comprised of two Senior loans with a term
of approximately 27 years)
 €119m subordinated debt bridge facility
 €15m working capital facility
.
29
TAIWAN
• The link Taipei to
Kaohsiung - total length
of 345km.
• The project had a
construction value of
approximately US$18bn.
Taiwan Govt.
• A concession to finance,
construct, and operate the
High Speed Rail System
for a period of 35 years
and a concession for HSR
station area development
for a period of 50 years.
• Demand risk
transferred to the private
sector operator
10 % of yearly earnings to
government for further HSR
development during the
HSR operating concession
period regardless of the
performance of the
concession company.
The accumulated amount
could not be less than
US$3.4bn.
Consortium led by
Kawasaki Heavy Industries
Procurement of Rolling
Stock
30
Taiwan High Speed Rail Corporation:
Alstom Transport SA of France and
Siemens AG of Germany
IMPLEMENTATION OPTIONS
Considering the case studies, following could be the
implementation options
 Non – PPP Option: The project are implemented by the
Government on EPC basis
 PPP Options


Option 1: Design, Build, Finance, Operate and Transfer
(DBFOT) of the entire project by a single Private Developer
Option 2: Unbundling the project into different components, so
as to make the project components attractive to private players
from the perspective of affordability in terms of size and risk
allocation:
 B&T (Fixed infrastructure)
 DFOT (Train operations)
31
IMPLEMENTATION OPTIONS
 Whether project is implemented through PPP or partial
Government funding route, pre-construction activities should
be started in a programmed manner – Government guidelines
 MOR has already created a company named High Speed Rail
Corporation of India as a subsidiary of RVNL.
32
FUNDING OPTIONS


Project Development Activities
 A separate fund may be created

To be recovered from viable projects along with additional fee

Rolling fund for further project development activities
Funding Support for PPP projects:
 Viability Gap Funding

Multilateral/Bilateral loans by providing Centre government
guarantees

Centre government guarantee for Long term Bonds of Project
SPVs
33
FUNDING OPTIONS

Funding Support for Non-PPP Projects
 Directly funded by Centre/State Governments

Other Sources of Funds
 Revenue share from Concessionaires (train operators)
 Contribution from State Governments
 Real Estate Development
34
STATUS OF PREFEASIBILITY STUDIES
Project Corridors
Status of Prefeasibility Studies
Pune – Mumbai - Ahmedabad
Final Report submitted.
Delhi – Agra-Lucknow-VaranasiPatna
Final Report submitted.
Howrah –Haldia
Final Report submitted.
Hyderabad-Dornakal-VijaywadaChennai
Draft Final Report submitted.
Chennai-Bangalore-CoimbatoreThirvanantpuram
Draft Final Report submitted.
Delhi – Chandigarh - Amritsar
Consultant yet to be engaged
Delhi-Jaipur-Ajmer-Jodhpur
Consultant yet to be engaged
35
THANK YOU
36

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