Cities Matter: November 2014

Councillors are getting nervous about the planned central rail link (CRL). So they should be. And while planning is well down the track, it’s not too late to apply the brakes.

This post strings together some of the arguments I have raised against the CRL over the past several years[1], and adds another one –the likelihood that technology gains will further undermine it.

But first some basics.

Moving more and moving further

Transport is a derived demand: you only get it in response to the demand to move people or goods. And as information flows more and more freely around the world, so growing demand for travel and trade -- locally, nationally, and internationally -- drives investment in transport.

As nations, towns, and cities prosper, we travel more and further. We exercise greater choice in where and how we live. We consume a greater variety of products and services at lower prices. And the transport sector responds with ever increasing products, services, and capacity.

Of course, it’s not just a one-way street. Transport innovations facilitate new trading relationships and expand travel demands. Innovation-driven gains in mobility have enabled the masses and not simply the rich to enjoy the benefits of access to more space, more places, and more lifestyle opportunities.

For example, the arrival of the wide-bodied jet in the 1960s and the more recent emergence of the single aisle, light weight, twin engine long-distance jet have increased the affordability of long distance travel and supported the emergence of many more international travel destinations for many more travellers.

Similarly, the globalisation of production has been facilitated by transformation of the freight industry into an integrated transport, storage, and fulfilment logistics sector operating seamlessly to deliver lower priced goods from producer to consumer regardless of the distance and borders between them.

Urban transport – a history of increasing personal mobility

This is not the place to detail the history of urban transport, but it’s worth noting a legacy of occasional step changes resulting from disruptive new technologies interspersed with long periods of refining existing technologies. These two have offered people the opportunity to enjoy more space, better health, and better lifestyles through progressively improved access to housing, services, work, and recreation.

Hence the displacement of horse and carriage with steam-driven and tracked vehicles in the second half of the 19^th century, the replacement of steam engines with internal combustion engines late in the 19^th century; the introduction of the omnibus at the beginning of the 20^th; the development of mass-production techniques for automobiles in the 1930s; and their proliferation in the 1950s and beyond.

Innovations in engines, propulsion, and materials have led to continuous automobile performance improvements. Even so, concerns about congestion, threats to oil supplies, pollution, and the costs of providing more road capacity raise questions over just how much more car use we can sustain.

Despite its own gains in distribution, comfort, and speed, mass transit remains an alternative limited by fixed routes especially in today's complex and often fragmented cities. The problem is less acute for buses than trains, although the economics of providing routes and schedules to suit diverse needs in large cities are entrenched in both modes.

So, where does the next step change lie in urban mobility?

Driving innovation

Perhaps the rate of advance to existing technologies has reached the point that disruptive technologies are less likely. Ongoing innovation in car operations (built most recently on revolutions in information technology) and advances in engines are likely to deliver major capacity gains from infrastructure and lower the cost and impacts of private motoring[2], lifting personal mobility and reducing the likelihood of step change. At the same time the propensity to use cars is stabilising, if not diminishing. [3] The threat is that the fixed route options for public transport will become even less attractive.

Of course demand will be continue to be driven up by population growth, even if individuals drive less. Herein lies the challenge: we are not talking about the mobility of current Aucklanders, but that of perhaps a million more seeking their share of transport infrastructure.

How do we cater for this: promote a return to the old technology of fixed route rail capacity? More roads? Or by managing transport demand through effective land use planning? I prefer a combination of all three, but it’s a preference based on (1) understanding the particular limits to and costs of continued obsession with rail and particularly (in Auckland) the CRL, and (2) returning to an emphasis on sensible land use as the engine of this particular train, not transport.

The limits to rail

At the risk of being repetitive [4] here are some of the reasons to reject major expenditure on the CRL (or a rail-based airport link or harbour crossing for that matter):

(1) Demand will be limited. A doubling or tripling of rail patronage will not go far in terms of total commuter demand given the very small base it operates off; 9,000 Aucklanders commuted by train according to the 2013 Census. That's 2% of commuters. Currently 10% of Aucklanders commute by public transport, 80% of those bus.

Boosting public transport demand though park and ride facilities or integrated ticketing is limited by the relatively small number of destinations served. Public transport travel time costs are already high and multi-mode travel inevitably lifts them no matter high efficient.

Boosting public transport demand by providing inner city dwelling capacity is largely irrelevant as inner city commuters already have a high propensity to walk, cycle or take public transport to work (only 55% use a private vehicle). That market is tiny anyway, and likely to remain so.[5]

Promoting high density dwelling around stations at key suburban centres to boost train patronage will meet market resistance. And, if successful, it will lead to conflicts between local activity and park and ride facilities, adding to local congestion.

Focusing employment on the CBD to boost the use of public transport ignores the needs of the majority of businesses (only 12% of Auckland employment is currently in the CBD). It also ignores questions over the resilience of the CBD. its ageing, often capacity-constrained infrastructure. and the vulnerability to extreme climatic events of low lying and reclaimed land on which much of it is built[6].

Promoting higher employment densities around stations to lift the viability of rail will generate additional road congestion as much of the interaction around businesses still requires point-to-point vehicle access, the majority of commuters are likely to remain car-bound, and the more people that live in and around the CBD the more of them will need to commute outwards to employment as well as for recreational reasons -- by car.

And there is a real question mark over what those many more white collar workers in the new towers might be doing,[7] especially as high tech employment increasingly favours low rise, green working environments.

(2) The impact on congestion will be minimal. Creating additional road capacity by diverting some commuter trips to public transport reduces the costs of private transport, encouraging greater car use until such time as unacceptable levels of delay once more set in. Such evidence as there is for developed cities in North America, Australasia and Europe does not support the proposition that public transport reduces congestion.[8]

(3) The Capital costs will be high – almost inevitably higher by hundreds of millions of dollars than current estimates;[9]. Even without the usual "large project blowout" the marginal costs will be very high: if the impact was to triple daily commuting patronage to, say, 30,000 people a day a capital cost of $2.4bn (both optimistic assumptions) represents $120,000 for each additional commuter.

(4) Overheads will be high – fixed costs are a large component of rail overheads. These include operating costs, maintenance, and renewals (for rolling stock in particular), interest on capital, and depreciation. Any demands on ratepayers or road users to subsidise this are still costs, costs that are likely to reduce the attractiveness of Auckland as a place to live or invest.

In addition, pricing public transport to recover even a constant share of higher costs from users is likely to lower demand. This, in turn, is likely to reduce income more than costs, potentially leading to a subsidy (public cost) blow out.

(5) The business case relies on heroic assumptions about the future of work and housing. Building a case on assumptions about a shift to high density housing on suburban stations and new towers of white collar employees around inner city stations is highly risky, with no evidence that the risks have been factored into decision making. [10] And there seems to be little consideration given to the risks to rail resulting from technical advances taking place in the automobile industry that should increase the efficiency of roads, lower the costs and boost further the convenience of cars, and improve the performance of buses [2],

(6) The economics do not stack up and consequently fiscal risk is high.[11][12] The legacy of the CRL is likely to be enduring debt and costs that potentially reduce the appeal of Auckland as a place to live without reducing the problem of congestion. And they will be so much higher if the optimistic projections on which the business case is based fail to materialise. When costs substantially exceed benefits productivity suffer and the Auckland economy is the loser.

There’s got to be a Better Way

The aim of this post was to contribute to the current debate over the future of the CRL. Whether or not it goes ahead it is not going to solve Auckland’s transport problems. Nor will an integrated transport system based on common ticketing and interchange stations with their substantial land demands and impact on local and arterial road congestion help much.

The long-term solution may best be based on a return to basics: identifying the land use pattern that is in accord with both the city’s geography and the ambitions of the council to house another million residents (an ambition that seems to have gone un-debated in the lead up to current plans). The transport system needs to be organised to serve that.

Planning land use to serve an outmoded transit model based on an increasingly dated transport mode justified by the view that Auckland can continue to grow as mono-centric city is a recipe for disappointment - and not just in transport.