New research challenges environmental argument for rail

ENVIRONMENTAL issues are gaining increasing momentum in the road versus rail debate. But monetarisation of environmental externalities is the new buzz phrase doing the rounds, and it adds a new dimension to the mix. There’s no question that rail is a more environmentally friendly option. Recent studies undertaken in the U K demonstrate that rail is 4-5 times better than road on environmental externalities. And if environmental costs were the only costs under consideration, rail would always win hands down. “But most recent research shows that while that ratio may be true, there are several issues to be considered like congestion and the other costs involved in transport. It’s only in fairly unique circumstances that the environmental differential would be enough to swing a decision away from road,” says Arup South Africa transport economics adviser Andrew Marsay. “Typically the environmental differential between road and rail would be 10% of the total cost of providing transport. “Therefore, if you can sweep up congestion more economically by investing in road then the environmental disadvantage will generally be insufficient to make a difference.” Environmental monetarisation is a fairly new science and has clearly not yet made an impact locally. “In South Africa we don’t monetarise the environment,” says Marsay, “we merely have statutory requirements – and it’s possible that there will be situations where statutory requirements will stop an investment where monetary factors would prescribe otherwise.” Marsay concedes that rail is still good for bulk, dangerous cargoes and non time-sensitive cargoes. “But where the main determinant of economic efficiency is manufacturing- rather than transport-driven, the transport must serve the whole supply chain. “If Transnet was forced to do a cost-benefit analysis before investing in container rail they would find a very low benefit/cost ratio compared to an investment in improved road facilities,” he said.