What Makes High-Speed Rail Work?
AECOM Interviews 112 Executives to Identify Best Practices That Could Accelerate New Routes
Why is high-speed rail (HSR) thriving in some countries but struggling to get off the ground in others, including the United States? AECOM, a global infrastructure company, released a white paper last week that provides new light on how to successfully develop 21st Century passenger rail lines.
“From Vision to Reality: a new high-speed rail playbook” is a first-of-its-kind report on the future of rail delivery. AECOM, which has 30 years’ experience designing and building high-speed rail projects, hopes that by providing a comprehensive view of best practices the report can accelerate the growth of HSR globally.
“It’s our hope that through better understanding of the opportunities and challenges attached to these mega projects that existing networks can expand, and proposed networks can move from vision to reality.” said Lara Poloni, AECOM’s president.
AECOM conducted qualitative and quantitative research with 112 senior decision-makers involved with HSR projects globally. Participants represented such companies as ADIF (Spain), High Speed 1 (United Kingdom), Brightline (United States), California High-Speed Rail Authority (United States), NEOM (Saudi Arabia), and China Railway Construction Company International.
Just between 2020 and the end of 2022 the size of the global high-speed rail network grew from around 27,000 miles to around 37,000 miles.
Globally, the most critical success factors for the first year of operation were economic growth, technology, adaptability, and on-time completion. In the five – ten years following launch passenger experience and adaptability matter the most while the impact of project delays becomes less important.
Success factors varied widely by region. For example, Europe prioritizes reduced air and vehicle traffic, use of latest technology, and future adaptability, while in the Asia Pacific region emphasis is on on-time completion, low environmental effects, and social benefits. In North America regional economic growth, use of latest technology, and passenger experience matter most.
Demand for high-speed rail service is growing globally. Just between 2020 and the end of 2022 the size of the global high-speed rail network grew from around 27,000 miles to around 37,000 miles. This growth has been driven partly by a shift toward more sustainable transportation modes to help reduce the effects of climate change.
In addition, by bringing cities closer HSR provides economic and social benefits. For example, fast rail service opens more educational, medical, employment, and entertainment opportunities to people living along and near the route.
The conglomeration effect draws companies to regional centers, which, in turn, creates jobs and builds local economies. This occurred in Malaga, Spain, where a new high-speed line that put the resort city within 2 ½ hours of Madrid may have been instrumental to attracting tech employers including Google Cybersecurity.
High-speed rail lines are among the biggest, most complex, and most costly infrastructure assets in the world, the report stated. They face numerous unique challenges that could cause delays, controversy, and cost overruns. However, these challenges can be overcome where they have continuous political support and cooperation from stakeholders and communities.
The development process - from the start of planning to opening a new line - can take decades. Before the first mile of track is laid activities the public doesn’t see such as: research, negotiation, consultation, strategy, land acquisition, simulation, and financial planning take years. While construction is the most visible element it can be a modest percentage of the total time needed to bring a HSR project on line.
Slow progress creates risks of its own since political parties in power change, economic cycles turn, and public opinion shifts. In California both Republican and Democratic governors delayed building the state’s high-speed rail network. In some markets inflation in the infrastructure sector has been running at twice the rate of the economy as a whole.
Eight in ten of those interviewed said costs would have to fall before high-speed rail can expand in their region. In addition, 73 percent of respondents fear rising construction, equipment, and material costs could stop projects already underway. The United Kingdom scaled back High Speed Rail 2 (HS2) partly because of local and global economic conditions.
While high-speed rail lines are overwhelmingly government run, Brightline, which now runs between Orlando and Miami, has shown private investors can also develop project. However, it has a strict set of criteria for deciding where to build and run trains.
“Our business thesis is focused on a few very tightly contained concepts,” said Brightline CEO Michael Reininger. “They include the power of the marketplace that you are serving, meaning we are connecting markets that are independently large with an existing travel dynamic which needs improvement.”
Brightline also leverages existing transportation corridors to expedite land acquisition and permitting. Most of the Orlando – Miami line route uses the Florida East Coast Railroad and the company will build much of its Las Vegas – Southern California route in the median of Interstate 15, the only major road serving its endpoints.
The report identifies four areas where changes can help keep projects on track:
1 – Regulatory and environmental issues. Processes should be streamlined and important infrastructure projects need to be prioritized. Common standards and protocols can expedite approvals when more than one regulatory system is involved, i.e., international routes. Building interoperable trains and systems could stabilize demand, which, in turn, would stimulate competition among suppliers and bring costs down.
2 – Land and local communities. Negotiations over land and right of way acquisition and opposition from local and special interests groups can delay projects indefinitely. Andy Kunz, president and CEO of the U.S. High-Speed Rail Association, called on federal governments to play a stronger role in negotiations by organizing consistent, standardized methods that balance local, regional, and national imperatives.
3 -Funding concerns. Cost overruns are commonplace and have derailed some projects. Developers need to demonstrate projects’ short-term and long-term economic viability. Policymakers must decide how to provide sustained funding. Private capital is playing a growing role through Public-Private-Partnerships (3P). For example, Microsoft and other large companies are backing the Cascadia project in the Pacific Northwest.
4 – Political risk. Projects depend upon public support and that support can wane when new leaders take control. Having a long-term vision is critical. The U.S. Interstate Highway System was designed to generate political support by connecting state capitals, ports, and other major cities. Its successes, i.e. completed projects, helped it broaden support.
While transportation output, i.e. ridership, is an important metric it is not the only benefit HSR can provide. It can stimulate local and regional economic development and can play an important role in reducing carbon footprints. These benefits are important to building and sustaining public support for projects, and developers needs to keep them in mind throughout the process.
New high-speed lines need to be built quicker, cheaper, and greener, without compromising safety, reliability, passenger experience, or integration with other modes, the report stated. Streamlining approval and permitting processes can speed up development. Other strategies to accelerate projects include stronger government support and stable financing, advanced construction methods and innovative technologies, and greater collaboration among stakeholders.
Further, projects need to be built with adaptability in mind. Eighty-two percent of participants said designs should be “future proofed” so systems can adapt and scale to meet new technological advancements.
The success at building and operating high-speed lines experienced by nations such as China, Spain, and Japan strengthen the case for HSR. Now, other countries, including the United States, where at least five projects are in development, want to catch up.
While respondents as a whole believe HSR has a bright future, the industry needs to address potential delays, rising costs, and other obstacles. This calls for strong, political leadership, new funding models, more transnational cooperation, new design methods and technologies, increased collaboration and industry outreach, better understanding of what the traveling public wants, and more rigorous cost control.
By identifying best practices in HSR development, AECOM’s report will help policymakers, project developers, and suppliers plot a course toward success. As more projects get built support for HSR will grow. “People worry about going over budget, rights of way and other issues but once it is operational the question changes. It becomes ‘how did we ever live without this?” said Brian Kelly, CEO of the California High Speed Rail Authority.