The ACT Government plans to kill two birds with one stone by incorporating the raising of London Circuit to connect with Commonwealth Avenue into the next stage of light rail to Commonwealth Park, as part of its ambition to bring the City to Lake Burley Griffin.

The Government announced on Tuesday that Cabinet had approved the business case for Stage 2A and it would now start one-on-one negotiations with the operator of Stage 1, Canberra Metro, for it to design and build the 1.7 km-long project, which remains subject to Commonwealth approval.

It said contracts could be signed as soon as the middle of next year, with construction starting in 2021 and the first passengers boarding in 2024.

But the Government is unable to provide any cost figures due to the coming commercial negotiations with Canberra Metro.

Chief Minister Andrew Barr said it made sense to continue with the existing operator, which had ‘skin in the game’ and was familiar with the environment.

Stage 2A, from Alinga Street to Commonwealth Park, just north of Lake Burley Griffin, is seen as a springboard for the more challenging Stage 2B through the Parliamentary Zone and will include three new stations and add an estimated 2500 to 3000 passengers to the system.

City West, on the corner of Edinburgh Avenue and London Circuit near the ANU, is expected to be the most popular station, with City South servicing the new residential areas of West Basin, and the southern terminus important for major events in Commonwealth Park and by the lake.

The journey from Alinga Street to Commonwealth Park is expected to take six minutes.

Mr Barr said including the raising of London Circuit to create a level intersection was a ‘clever sensible way to achieve two really good urban design outcomes’.

“This London Circuit project now will enable that southern part of the city to be more accessible to people and connect ultimately through a connection over Parkes Way to West Basin,” he said.

“This is bringing the City to the Lake, and also combines our thinking with improved public transport access by aligning the second stage of light rail with that project.”

Transport and City Services Minister Chris Steel called it a once in a lifetime opportunity to connect London Circuit with Commonwealth Avenue at the same level to provide an access point for the light rail line but also better connections for walkers and cyclists through to the Acton waterfront.

City Renewal Authority chief Malcolm Snow said the idea, which has been in the National Capital Plan since 2007, had been an aspiration of Government for some time and talked about since the early 2000s.

“The road design dates back to a time when traffic engineers placed priority on cars,” he said. “Successful cities also place priority in the way in which other modes can negotiate and travel around the city, and that’s fundamental particularly to our active waterfront project but also to broader renewal effort for the city centre.”

Mr Steel said the light rail network would need extra rolling stock for the extra leg and the Government would be starting negotiations for four more light rail vehicles.

He said construction would mean disruption to businesses and commuters but the Government was working to minimise this. It has already been engaging with businesses along the route and would ensure that there would be access points for commuters into the city, such as extending Edinburgh Avenue from London Circuit through to Vernon circle.

The Environment Protection and Biodiversity Conservation (EPBC) referral for Stage 2A will be updated in coming weeks to include the London Circuit project but there had not been any response so far from the Commonwealth on both 2A and 2B.

The Public Transport Association of Canberra (PTCBR) welcomed the Government’s decision to proceed with Stage 2A and the inclusion of the London Circuit project.

Interim chair Ryan Hemsley said it was good to see action being taken after a few too many delays.

“Commencing construction on the leg between Alinga Street and Commonwealth Park is the first important step towards bringing fast, frequent, reliable and attractive public transport to Canberra’s south, and will help retain the skilled workforce acquired during the construction of Stage One,” he said.

On the London Circuit plan, Mr Hemsley said it was good to see work planned over a decade ago was finally coming to fruition.

“This will be a really good addition to the urban amenity of the city and it finally closes the horseshoe of the city. No longer do you have to go all the way north to go all the way south,” he said.

“This is finally going to make that connection possible for pedestrians and motor vehicles and cyclists.”