by the Australasian Railway Association (ARA)
As a means to move freight, rail works. In many instances, it is the stand-out performer when compared to other modes of transport. This is particularly true for moving heavy bulk material over long distances.
The Australasian Railway Association (ARA) has long advocated for greater use of rail in the freight sector to maximise the clear safety and sustainability benefits that can be derived.
However, despite the advantages rail freight can offer the community and economy, achieving increased modal share has traditionally proven to be difficult.
State policies across Australia have set a range of mode share targets over the last decade, aiming to increase the use of rail to up to 30 per cent of the overall freight task.
Unfortunately, rail’s share of freight movements in and out of container ports remains low, sitting at between just two to 17 per cent across the country.
Earlier this year, the ARA released a new report on the impediments to rail modal shift to define the key challenges preventing greater use of rail freight despite government aspirations to maximise the benefits rail has to offer.
The release of the report was timely given the essential role rail will play in meeting our growing freight task.
Four key areas that require action
In 2019, rail met 56 per cent of the national freight task and carried five times more bulk freight than road. Rail is expected to meet almost three quarters of the growth in demand for freight to 2030, highlighting its essential role in supporting strong supply chains as demand grows.
It is also an essential part of the sustainable growth of the freight sector, with rail generating 16 times less carbon pollution than road, and easing congestion on our city roads and regional highways.
However, urgent action is needed now to support greater use of rail to meet growing demand in the freight sector. The report identified four areas that were key to increasing rail freight’s modal share:
1. Need to address policies for metropolitan networks shared by freight and passenger services
Shared networks in the freight sector generally prioritise passenger services, with some networks also implementing track curfews for freight services.
These policies reduce the time available for freight services on the network and limit the ability of freight operators to establish schedules that maximise the efficiency of their fleet.
While new, dedicated freight lines are an obvious solution in some locations, the fact remains that shared networks will be a reality for some time to come, and a shift in policy settings will be essential to addressing this issue.
During the pandemic, greater flexibility was applied to some freight networks to ensure essential supply chains remained open. The experience highlighted the opportunity for new approaches that still preserve network efficiency for passenger services, but which deliver better passenger and freight rail integration to make the best possible use of the network.
2. Improved land use planning to support the development of dedicated rail hubs
Last mile costs can have a significant impact on rail freight’s competitiveness. Creating hubs that locate businesses using rail close to inter-modal terminals can significantly reduce these costs and support the development of complementary services. It is therefore essential that land is preserved for rail facilities and railrelated services along key freight routes to maximise co-location opportunities over the long term.
3. Creation of new rail terminals will help achieve higher volumes of freight on rail
Rail does require higher freight volumes to be competitive with other modes and the establishment of new freight terminals can be key to supporting this outcome.
However, the up-front costs of rail terminals can be high and financial assistance in their early growth stages may be required to maximise the full benefit of these investments. It is important funding decisions for new rail infrastructure such as terminals considers not just the capacity benefits the projects can deliver, but also the wider social, environment and social benefits greater use of rail has to offer.
4. Lowering handling costs at ports and rail terminals will be key to greater use of rail freight
Higher freight loading and unloading costs when compared to rail has likely affected mode shift over time. Rail terminal costs, including handling costs at ports, has impacted rail’s competitiveness.
It is pleasing to see many ports have, or plan to, address this issue to support greater use of rail in the future. Enhancements to freight infrastructure to increase automation, implement modern loading facilities and monitoring technology, and support efficient connections between all freight modes will also support reduced handling costs over time.
Exploring further industry opportunities
While the report confirmed there remains a great deal of work to do to support increased use of rail freight, the good news is that investment in the sector is strong.
The progress of landmark projects such as Inland Rail, in addition to investments in infrastructure to improve efficiency such as the Botany Rail Duplication, highlight a clear commitment to supporting greater use of rail as part of an efficient and resilient national supply chain.
The ARA is continuing to work closely with industry to explore opportunities for greater use of rail, with a joint research project with the Australasian Centre for Rail Innovation, Freight on Rail Group (FORG) and the Department of Infrastructure, Transport, Regional Development and Communications (DITRDC) currently underway.
The project will build on the outcomes of the ARA’s report to further assess industry perceptions, barriers and opportunities to improve rail freight modal share.
Ultimately, greater use of rail will support improved outcomes for the freight sector as a whole as demand grows. That is why action is needed now to make the most of the wide range of benefits rail freight has to offer.