1 Noise differentiated track access charging Joint position of railway representative bodies Workshop on Noise differentiated track access charges And other rail noise developments at the EU level Brussels, 27 th April 2010

2 Introductory Remarks Reduction of rail noise is a common goal for all actors of the sector in order to ensure the environmental friendly character of the rail transport mode and to maintain the high levels of acceptance of this transport mode in society However the efforts must stay proportionate among all transport modes. Sector urges to consider Rail freight's market conditions Budgetary situation of Wagon Owner No revenue losses for IMs or other actors in the sector; Therefore, an impact assessment is vital to estimate the effect on the freight traffic and a possible modal shift from rail to road if track access charges are increased

3 Sector position – central proposals of the KCW study supported The sector agrees with the central proposals of the KCW study: Retrofitting of freight wagons is the most effective method to reduce rail freight noise Due to fierce competition wagon owners do not have sufficient resources to finance the retrofitting of their fleet The level of complexity and administrative costs must be kept to a minimum Any incentive system should neither weaken the overall market share of the freight sector nor disadvantage any freight market player

4 Evaluation of the study on NDTAC (KCW) - 1 Direct funding It will be more difficult to manage funding under NDTAC than under Direct Funding that appear to be easier, cheaper and quicker to introduce The sector recognises that any kind of discrimination must be avoided, but is convinced that direct funding was rejected prematurely. Financing Unacceptable risk of funding NDTAC bonuses through the overall increase of track access charges; consequence: risk of modal shift from rail to road NDTAC is unacceptable as long as various systems apply for TAC calculation in individual MSs (disproportion EU 15 x EU 10) The internal/external financing and problems of rail freight companies & wagon owners are not taken into account sufficiently

5 Evaluation of the study on NDTAC (KCW) - 2 CEE/SEE too little consideration of Central & Eastern-Eastern Europe (only two from CEE), so the specific issues of CEE/SEE have not been considered adequately Wagons with tyred wheels would cost far more to convert into quiet wagons because composite brake blocks cannot be installed in these wagons the replacement of the wheelsets to be considered; consequence: necessity of special funding Timing Timing is not discussed Considering the high retrofitting cost of K-blocks for the time being the serial retrofitting cannot be considered until LL blocks are available (by more than one manufacturer) – not before end Every effort must be made to speed up homologation of LL-blocks – in this regard manufacturers play a key role The legislation should therefore not set timetables which require retrofitting before LL blocks are available

6 Evaluation of the study on NDTAC (KCW) - 3 Complexity & costs Full impact assessment missing for charging NDTAC routing of wagons train composition varying technical characteristics of wagons Important cost elements were not considered: Design /homologation costs for each wagon type; The opportunity cost of taking wagons out of service Those that would be incurred by the infrastructure manager The marginal costs of using TAF-TSI based on wagons; The cost of the billing system; The cost for administering the proposed clearing entity The costs of the proposed control and enforcement body

7 Evaluation of the study on NDTAC (KCW) - 4 Wrong assumptions / missing considerations The NDTAC will have to be far higher than the 3-9 cts/wagon km (equal to 0,9-2.7/train km) proposed to cover all related expenses and to set the desired incentives. Note that in eight member states, the track access charge for freight trains in 2006 was less than 2 /train km so NDTAC would have major impact! Reasons: The lower value of LL-block retrofitting costs is much lower than the sector estimates (~1250 instead of 500 for 4-axled wagons) The additional operating costs of LL and K blocks, due to greater wheel wear have been underestimated (by more than 50%). Wrong assumption of an average yearly mileage of km, the real one of the mainly used fleet is around km The report limits its proposals on the relations between IM and RU. It fails to analyze whether and how wagon owners would be provided with incentives to retrofit wagons more actors means more transaction costs !

8 How to reduce railway noise quickly and efficiently? Funding and Financing – results of the sector (UIC) study Possible funding source?

9 Recent statements of the DG MOVE Director General to be supported A bonus system should be put in place for less noisy wagons the implementation of such a bonus system shall not be preceded and undermined by an overall increase in track access charging The concept of self-declaration of wagon-kilometres run with less noisy wagons supported In fact no need for sophisticated technical applications / adaptations of TAF TSI after completion of retrofitting exercise!

10 Planning of further steps – must be realistic! Actions must be carefully planned! Retrofitting of wagons needs to be realistically scheduled Bonus system must ensure that administrative and transaction costs are as low as possible Bonus system shall be introduced in all member states operating standard gauge continental railway, otherwise it will accentuate distortions and thus result in negative effects on rail freight corridor developments Public funding should preferably go directly to wagon owners to ensure high level of incentives The sector knowledge should be welcomed!

11 Model proposed by the sector- 1 (presented in the frame of the Leiser Rhein programme) Noise & mileage-based wagon bonus system: National authorities should fund the retrofitting of freight wagons by means of a noise reduction bonus Starting at the date when LL brake blocks are ready for serial production and economically viable Terminating when vast majority of the eligible freight wagons is retrofitted (approx 8 years) The noise reduction bonus to be granted on the mileage basis travelled on lines of the respective national networks The noise reduction bonus compensates investment costs as well as the additional operating costs and transaction and administrative effort

12 Noise & mileage-based wagon bonus system: The maximum amount of aid per wagon results from the total expenditures caused by the retrofitting (investment and additional operating as well as transaction costs) The brake equipment will be registered at the NSA - based on NVR The railway undertakings communicate the mileage of the wagons carried by them on trains on the network concerned on an annual basis - based on GCU Both, NVR and GCU existing systems enabling an European harmonized rollout of the model The Bonus should be paid directly to the wagon owners The annual application for bonuses will be based on the wagon mileage recorded by the keepers/owners After the retrofitting is finished: no need for a NDTAC scheme as an incentive for retrofitting! Model proposed by the sector- 2 (presented in the frame of the Leiser Rhein programme)

13 Bonus allocation process No contractual or financial relationship Administrative costs for getting information from Infrastructure Manager Train performance Calculationof bonus Railway undertaking Mileage of wagon Wagon keeper/ or Wagon owner? Pays bonus Claims bonus Pays bonus/ factored in renting price The State Compensation (MACsor dedicated fund) Risk of leakage effect, since various RU-WO constellations are possible 1. KCW studys option Infrastructure Manager Train performance Calculationof bonus Railway undertaking Mileage of wagon Wagon keeper/ or Wagon owner? Pays bonus Claims bonus Pays bonus/ factored in renting price Member States / EU? Compensation (MACsor dedicated fund) Pays bonus 1. KCW studys option 2. Rail sectors option

14 Summary – actions needed both on the sector and legislators' side Focus efforts on rapid homologation of economically viable LL-blocks The Commission is invited to support the Europe-train project Bonus addressed directly to wagon owners Self declaration principle No impact for IMs Wagons with no other changes but that in the material of the brake blocks (especially LL-blocks) should be exempted from any mandatory repeated authorization procedure by authorities The Commission should support that retrofitted wagons accepted by one MS get cross acceptance The Commission should support coordinated engineering

15 Further sector involvement Legislative proposal of the Commission Addressing noise related track access charging in the frame of the Directive 2001/14 The sector shall be consulted before presenting proposals for modifications of the aforementioned directive The Commission Working group? To spell out various issues related to the design of a noise related track access charge and co-draft new regulations (e.g. new annexes to Directive) To achieve a harmonized approach to the structure of noise related track access charged The sector expects to be invited to participate very soon

16 Thank you for listening!