Sep 8, 2016

Declined freight traffic in every key Rail Network of the world plummets Decarbonisation Agenda

Cargo supremacy: Jury still out on roads vs railways! Over the past fifteen years, the share of freight on railways compared with roads has declined in every key rail network of the world

The plans to decarbonise Indian transport sector by carting a larger share of freight traffic on railways instead of roads doesn’t have any global success to lean on.
The rail ministry wants to capture at least 45 per cent of the total freight traffic by 2046-47, from the current share of less than 30 per cent. International experience shows this will be a first of sorts if it happens. Over the past fifteen years, the share of freight on railways compared with roads has declined in every key rail network of the world.

Whether it is the mega railway networks of USA, China or Russia or the small but efficient rail networks of Japan and Switzerland, the railroads have lost out to roads.

The success or failure of the shift of freight traffic to rail has pivotal implications for India’s chance to meet the Intended Nationally Determined Contribution (INDC) targets to reduce its energy intensity by 33-35 per cent by the year 2030 from the level of 2005. A lower intensity means higher efficiency in powering gross domestic product (GDP) growth. It was committed by India at Paris in November last year.

The railways strategy is thus twofold. One of this aims to lower its own energy footprint from the current levels by shifting from diesel to electric traction. At the same time it wishes to capture more share of the freight business from the roadways.

Dinesh Mohan, one of India’s leading authority on transport sector, says the Indian Railways is flying in the face of international experience in assuming such a large volume of freight traffic will gravitate towards it.

Data from European Union (EU) countries show rail freight traffic as percentage of total surface transport has declined to only 23 per cent by 2014 from close to 37 per cent in 2001. In the US, it has dipped from 42 per cent to 39.5 per cent in the same period. Canada has also followed the same route and so has China.

This has implications. While greenhouse gas emissions has stabilised over most sectors by the 2000s, the share of transport in emissions of carbon dioxide has risen. The share of transport in worldwide carbon dioxide emissions is now one fourth compared with one sixth in the 1980s.

Most of the rise is now coming from non-OECD (Organisation for Economic Co-operation and Development) countries, typically China and India. And within transport sector the biggest jump comes from road transport. Intergovernmental Panel on Climate Change data show its carbon footprint outdistances other forms of transport 3:1. The volume is expected to double by the year 2050. Within road transport the largest share of these gas will come from freight transport. It thus makes enormous sense to plan a shift away from road to rail for freight transport.

In 2015, the rail ministry under Suresh Prabhu identified the challenge and set up a directorate of environment. And typical of government functioning it has been saddled with some other responsibilities too like housekeeping. Also typical of the government it does not have much of powers to enforce a change in business practices within the railway empire. Chief of the department, K Swaminathan, advisor, environment, however, exudes an air of confidence. “We are confident of a phase change once the work on the Western and Eastern Dedicated Freight Corridors gets completed.” The work should be largely over 2020 according to railway estimates. By then the railways estimates it will carry 1,117 billion traffic kilometres at a compound average growth rate or CAGR of 9 per cent. This is a huge level of expectations.

Saon Ray, senior fellow at Icrier, is sceptical about the numbers. The author of a recent report on decarbonisation of Indian Railways, her calculations show railway freight traffic has grown at a CAGR of much lower 5.43 per cent between 2003 and 2015. “The trend of low growth in freight transport is expected to continue till (railways) improves the speed and quality of freight service.” She does not see that happening for the next five years.

The numbers are difficult. To come anywhere close to even retain the current share of goods traffic business, the railways has to double the single line tracks at the rate of 2000 kilometres every year till 2020. This is in addition to the 400 kilometres of new track it must lay out at the same time.

To begin to wean freight traffic from the road sector, the railways must depend on the addition in route length which will come from the dedicated freight corridor. The target is 3,376 kilometres.

There are further complications. By the year 2030, the railways as part of INDC plans to move 80 per cent of its passenger traffic and 100 per cent of its freight traffic to electric haulage. That is just 15 years away with the current railway electric traction at 40 per cent of its total route length. Ray points out since electric engines are 10 per cent less effective to start a train and also when pulling the wagons along, the railways will have to invest correspondingly much more on electric locomotives. So the transformation to a less carbon footprint can actually mean loss of freight traffic share by the railways.

A data sheet created by NITI Aayog for the railway ministry shows just to retain its share of freight business the number of additional diesel locomotives needed to be brought into service in the next five year is 1,866. The number of electric locomotives has to go up by 1,859 in the same time. The railways add less than a 100 each year every year to its rolling stock.

There are a host of reasons why freight transport is skittish about rail. In Europe the share of EU-28 nations’ inland freight that was transported by road in 2014 was 74.9 per cent or more than four times as high as the share transported by rail at 18.2 per cent. There are different reasons for variations across the countries but the results hold true. In Mexico, for instance, the share of rail in freight went down sharply to less than 20 per cent in 2001 due to under investment. It recovered under a World Bank supported programme but has stagnated thereafter.

In the Indian Railways’ directorate of environment, Swaminathan’s team is concentrating on non-rolling stock items to make the railway divisions more aware of their environment footprint. The railways currently use 1000 million litres of water daily ranging from washing the trains and tracks to serving its employees and passengers. He has set a target of converting at least a fifth of the total to recycled water within the next three years.