High Speed Rail - Improving Cost Predictability

Carin Rautenbach
High speed rail is on the agenda for many countries. The U.K. government is considering a new high speed rail (HSR) network, to transform the U.K.'s economic geography and provide a genuine alternative to air travel. Construction costs are estimated at $52billion.

Here in the U.S., the President is proposing to invest $53billion over the next six years to continue construction of a national high-speed and intercity passenger rail network. The White House says this will create a major economic boost.

The Department of Transportation also has existing work ongoing with several states, to plan and develop high speed and intercity passenger rail corridors. These range from upgrades of existing services to entirely new rail lines exclusively devoted to 150 to 220 mph trains. In California, cost estimates are in excess of $45billion for the California HSR.

Why is cost certainty difficult for high speed rail?

Transportation projects are typically subject to uncertainties due to long planning, design, implementation and operational timescales, which often involve complex internal and external interfaces.

Over the project development and implementation phases, the project scope will often change, leading to a degree of uncertainty in both budget and schedule.

Optimism bias tends to be high, with most rail projects out-turning at a 40-50 percent higher cost than anticipated. Schemes usually take longer than planned and do not always deliver the planned benefits.

What can be done to improve the cost predictability of rail schemes?

We suggest that the most successful schemes will explore a range of issues and implement various tools and techniques.

It’s especially vital that sufficient exploratory work is done during the project’s pre-construction phase, to ensure a robust proposition.

Particular attention should be paid to the commercial aspects of the scheme including the estimation of capital costs, life cycle costs and the identification and management of risk.

Consider the following:

  • Make use of an experienced  project management team
  • Aim for standardization (stations, structures, rolling stock), as bespoke design solutions increase costs and can take longer to implement
  • The relationship between capital and life cycle costs and potential trade-offs
  • Keep procurement strategy as simple as possible
  • Limit breaks in program, i.e. reduce the number of phases, as stopping and starting a project can significantly increase the costs

Faithful+Gould has the experience to help

Our global rail experience includes several future high speed schemes at exploratory proposal level, as well as our practical U.K. experience as project and cost managers for the HS1 fit-out at St Pancras and at Ebbsfleet International, and the feasibility stage for HS2.

We have also worked with Kuwait Metro Feasibility Study, Norwegian High Speed Rail Study, Metro West (Ireland), Manchester Metrolink, Glasgow Airport Rail link, London Crossrail, Ultraspeed, Docklands Light Railway (various), Dubai Metro, Union Railways (UAE) and Wien to Kosice Freight Upgrade Study.

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