This is a guest post from Dr Roger Blakeley, former Secretary for the Environment; Bob Norman, former Commissioner of Works; Alex Gray, professional civil engineer and Senior Project Manager; and Keith Flinders, Electrical Services Consultant.

On 10 May 2018, Radio NZ reported that, in a briefing to Ministers on 21 March 2018, KiwiRail said that it had received no direction from the Government to cease the de-electrification programme on the NIMT and is continuing its work to decommission the electric locomotives fleet by 31 March 2019.

There are three key issues in KiwiRail’s advice to the Minister of Transport, as explained in the Radio NZ item of 10 May 2018, that are not correct:

1. Costs of Diesel v Electric Locomotives.

KiwiRail advised the Minister that: they could not afford to buy new electric engines; that it is hard to justify on cost grounds replacing electric locomotives that are near the end of their life with new electric locomotives; and that it is estimated that diesel engines are between 30 and 40 percent cheaper over the course of their lives.

The facts are:

KiwiRail’s current electric locomotives are midlife and not at the end of their useful life as stated by KiwiRail in their briefing to the Minister. As noted by the Rail and Maritime Transport Union (RMTU), the electric fleet locomotives are the second most modern mainline locomotive in KiwiRail’s fleet. Refurbishing the electric locomotives is a valid commercial proposition. KiwiRail’s best locomotive, the DX class diesel-electric locomotive, was introduced in 1972 and received a comprehensive overhaul in 2006 – 34 years after introduction. By comparison the EF class electric locomotive on the NIMT is only 32 years old.

The lowest cost option considered by KiwiRail in its ‘Better Business Case’, dated 21 December 2016, was an upgrade of the electronic control system on the electric fleet. This would have cost only $10M. If the electronic control system is upgraded, the electric locomotives’ life would be extended by over 20 years.

While the diesel locomotives have lower capital costs, they have higher operating and maintenance costs, and only half the life of electric locomotives. The ‘whole-of-life’ costs of new electric locomotives are less than new diesel locomotives.

In the KiwiRail December 2016 ‘Better Business Case’, the diesel option was calculated to have a Net Present Value cost range of $204m to $236m (lower and upper bounds), compared to the electric option, which had a range of $242m to $310m.

However, a leaked (early 2017) KiwiRail internal review critiqued the financial modelling that informed the Board paper at the end of 2015. It said that the financial modelling under-represented the cost of the diesel option and over-represented the cost of the electric option. Based on the corrected model, that review assessed the cost of the electric option as $230m cheaper than the diesel option. The final ‘Better Business Case’ appeared to ignore that internal review. It is still being ignored in advice to Ministers in the new Government in March 2018.

2. Reliability and Time performance

KiwiRail advised the Minister that the current locomotive switches from diesel to electric locomotives, and back again, at Te Rapa and Palmerston North affects the reliability and time performance of KiwiRail’s services, and reduces the attractiveness of rail as a freight option compared with road.

The facts are:

The scheduled delays in the ‘Better Business Case’ of 21 December 2016 are for 40 minutes at each location of Te Rapa and Palmerston North. The redacted sections of the ‘Better Business Case’ (leaked to the authors) included four trials in July 2016, which found that the delay for each locomotive change was on average 5 minutes, rather than the 40 minutes scheduled. The average 5-minute delay at both Te Rapa and Palmerston North is negated by the faster speed of electric locomotives on the electrified section of the NIMT, which makes up 10 to 20 minutes. Therefore, the decision to switch from electric locomotives to diesels cannot be justified on time-saving grounds.

3. Greenhouse gas emissions

KiwiRail advised the Minister that a shift from electric to diesel locomotives would provide a more consistent and reliable service for modal shift onto rail: “For every tonne of freight moved by rail there is a 66% carbon emissions saving over heavy road freight”.

The facts are:

The same reliability, efficiency, reduction in travel time, and corresponding mode-share shift would be achieved by new or refurbished electric locomotives or dual-mode locomotives travelling between Auckland and Wellington – see 2 above.

In New Zealand, 80% of electricity production is from renewable resources such as hydro or wind power, with a new government target of 100% renewables by 2035. Consequently, only a small proportion of electricity supply required for an electric locomotive fleet depends on burning fossil fuels.

KiwiRail will burn an extra eight million litres of diesel per year using diesel locomotives on the electrified section of the NIMT. This is in direct conflict with the Government’s target of reducing to net zero carbon emissions by 2050.

Professor Ralph Sims of Massey University said “the rail network would generate 12,000 tones of carbon dioxide per year by de-electrifying – more than cancelling out the 9,000 tones saved by using 3000 electric cars”.

4. Towards Full Electrification of the NIMT

A critical issue in this decision is the importance of retaining the long-term capability to fully electrify the NIMT.

The KiwiRail decision to switch from electric to diesel locomotives on the NIMT involves retaining the electrified infrastructure required for electric trains on the NIMT, and keeping the lines maintained, inspected and energised, at an estimated cost of $2m-3m per year. This funding could be at risk from future budget cuts, which could jeopardise any future opportunity to electrify the whole NIMT.

The options of a new electronic control system for the electric fleet, new electric locomotives or dual-mode electric-diesel locomotives would all potentially be part of a long-term transition to a fully electrified NIMT. A first step could be electrification from Papakura to Te Rapa. This would also allow the extension of the EMU commuter service from Auckland to Hamilton.

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