economic characteristics of road and rail freight transport infrastructure
DESCRIPTION
Dr Ric Simes, Director, Deloitte Access Economics delivered this presentation at the 2012 Ausintermodal conference. For more information on the annual event, please visit the website http://bit.ly/18MD4XMTRANSCRIPT
FreightSoftware and hardware
AusIntermodal Conference
31 October 2012
2 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Introduction
• Economic megatrends will affect transport
• How we organise our cities should be seen as an
area of microeconomic reform
• Transport is fundamental to cities’ economies
• Transport policy:
– Software
– Hardware
3 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
An example of software and hardware
• Competition reform in energy
– A change to software
• Allowed large productivity gains
• These took us through 20 years
– Now moving into a time of hardware investment
4 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Transport software and hardware
• Important transport decisions
• Largely controlled by Cabinets
• Software improvements could be
beneficial
• Long term need to focus on
transport strategy
5 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Megatrends and transport
Continued growth of Asia ICT
Climate changePopulation pressures
6 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
The size of our cities
16
227
7
111
Population (m)
GDP ($bn)
8 major cities Other
7 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
The shape of our citiesSydney Brisbane
1991
2011
Source: chartingtransport.com
8 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
The challenge of cities
0
2
4
6
8
0 1 2 3 4 5 6
Congestion cost ($/trip)
Population (m)
Policy responses
software and hardware
10 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Road & Rail – Metropolitan Sydney
-30
-20
-10
0
10
20
30
40
50
0.7m 1.4m 2.2m 3.9m 7.0m
Cost differential ($)/TEU
Port throughput (TEU)
Rail volumes grow 25% faster
Base Case
+ Externality differential
Forecast Historical
Estimated road and rail cost differential, SydneyR
ail
ch
ea
pe
rR
oa
d c
he
ap
er
11 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Software – PBLIS in Sydney
0% 20% 40% 60% 80% 100%
2010-11
2009-10
2008-09
2007-08
2006-07
2005-06
2004-05
2003-04
2002-03
2001-02
2000-01
1999-00
1998-99
1997-98
Rail RoadTEU
Mode share at Port Botany
12 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Software – PBLIS in Sydney
Volumes through Port Botany
0 50 100 150
0.0
00
0.0
05
0.0
10
0.0
15
0.0
20
0.0
25
Distribution of TTT
TTT (minutes)
De
nsi
ty
PBLIS
Trial
Average PBLIS
Average Trial
13 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Software – technology
Optimisation of truck routes Improving traffic signals
Congestion cost saving of
$244m a year in NSW
Cost saving of $730m a year in Australia
GDP: $7.3bn in period to 2021 (NPV)
14 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Road & Rail – around Australia
0%
25%
50%
75%
100%
0 1750 3500
Rail
Road
Mode share
Haul (km)
North-south East-west
Source: BITRE report 120
15 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Hardware – a freight line
• Inland rail is not economically
feasible (for now)
• The Sydney problem
• Improving Sydney could help the
city and the east coast freight
network
S
B
M
Road only
Road and rail
16 Freight: hardware and software © 2012 Deloitte Access Economics Pty Ltd
Summary
• Economic megatrends will affect transport
• How we organise our cities should be seen as an
area of microeconomic reform
• Transport is fundamental to cities’ economies
• Transport policy:
– Software
– Hardware
General information only
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© 2012 Deloitte Access Economics Pty Ltd