Energy Transition of Rail Transport

This paper provides a method to measure the competitiveness of decarbonized rail alternatives. As there is not, to our knowledge, a standard method to evaluate the competitiveness of decarbonized rail alternatives compared to existing solutions, we proposed one. The uniqueness of this new approach comes from the fact that we are considering simultaneously both the economic equation and the environmental balance, two topics usually treated separately even though they are interdependent. To demonstrate the relevance of this method, we apply it on a real use case. Our analysis do not consider only one type of decarbonized solutions but cover all rail alternatives. This economic approach, albeit initially intended for the railways, could be applied to other transport modes. Nowadays, air pollution is responsible for the deaths of almost 9 million people worldwide each year (Lelieveld et al., 2019). Even if rail is already one of the greenest modes of transport (Bigo, 2020), it is still responsible for Greenhouse Gases (GHG), of which 85MtCO2 (IEA, 2022), and air pollutants. Today, given that 56% of all track kilometers are non-electrified, 57% of the locomotives are diesel-powered and over 75% of them are used for freight (UNIFE, 2022). Even if electrification is progressing worldwide, there are still, for economic, technical and safety reasons, portions that are not electrified. As a result, today, 80% of diesel freight train-kilometers in France are done under catenaries (Simian, 2019). An environmental nonsense that leads to avoidable emissions. For few years now, influenced by the trend towards decarbonization, rail has been undergoing a major conversion. A change that is leading to the emergence and adoption of decarbonized alternatives by the rail industry (whether partially or fully decarbonized). Given the great diversity of rail use cases (both passengers and freight) resulting in a heterogeneity of decarbonized alternatives, it is becoming more and more complicated for a decision-maker (shippers/operators) to choose the most suitable solution according to their needs. Although the literature on transportation costs is abundant (Anupriya, 2020) the sub-theme of rail, and more specifically of decarbonized rail alternatives, is still poorly studied. This research aims at providing an economic method to guide a decision-maker in his choice of a decarbonized alternative. How to effectively evaluate and compare the competitiveness (from a technical, environmental, and economic perspective) of decarbonized rail alternatives (either partially or fully decarbonized) to provide concrete answers to public authorities and guide the choice of rail decision-makers (operators/shippers)? Since no basis has been found in the literature, we propose in this paper a methodology to assess and compare the economic efficiency of decarbonized rail alternatives. In this paper, we propose an innovative method to compute the Total Social Cost (TSC) including the Total Cost of Ownership (TCO) and the Total External Costs (TEC) in Net Present Value (NPV) over the lifetime of the Rolling Stock (RS). We implement an intuitive 6-step method. The first step is to identify the mission to be analysed. The second step is to gather the required data for an economic analysis through surveys and discussions with shippers and/or operators. We can classify these data in eight main categories: the mission data, the infrastructure data, the train data, the climatic data, the energy data, the cost data, the environmental data, and the external factors. The third step is to conduct a technical feasibility analysis of the reference solution and potential alternative. The fourth step consists of computing the environmental impact of the solution. The fifth step consists of an economic assessment of the potential alternative versus reference solution. We compute the Total Social Cost (TSC) (Currie, 2021) including (1) the Total Cost of Ownership (TCO) by integrating the Total Cost of Acquisition (TCA), the Operating Costs (including energy cost, driver cost, track access charges, insurance cost, extra costs), the maintenance cost (predictive, preventive and corrective and (2) the Total External Costs (TEC) by integrating the cost of up and downstream processes, the cost of climate change, the cost of air pollution, the cost of noise pollution and the cost of accidents. The sixth and final step consists of computing and comparing the abatement costs of the reference solution versus the alternative. All these parameters are inherently related to the geographical area under consideration in the study. We perform the TSC analysis in Net Present Value (NPV) over the lifetime of the rolling stock (e.g., 30 years). Finally, we introduce scenarios into our model to adjust the TCO through various (energy cost, track access cost, carbon tax cost). To demonstrate the relevance of this approach, we apply it on a real use case in France. The approach outlined in this paper allows for an accurate analysis and comparison of decarbonized rail alternatives for a given mission and provides concrete answers to decision-makers within the framework of public policies. The uniqueness of our approach lies in the fact that we compare the polluting solution and the decarbonized alternative via the economic equation and the environmental balance, often treated separately even though the two are interdependent. We believe that this approach will allow for an effective comparison of decarbonized rail alternatives for a given mission and provide concrete answers to decision-makers within the framework of public policies. This economic approach, while initially intended for rail, could be applied to other modes of transportation.