CFR SA can increase track access charges after investing in infrastructure quality

The Draft Decision on the approval of the addendum for 2013 to the activity contract of the National Railway Company, CFR SA, for 2012-2015, published by the Romanian Ministry of Transport in February 2013, indicates that the railway manager will establish the track access charge (TUI) based on internal norms without the implication of the authorities.

The document stipulates that “CFR SA establishes the track access charge based on the methodology for track access charging set in the normative act, without the implication of the Ministry of Transport, as asked by the representatives of the European Commission who accompanied the evaluation missions of the International Monetary Fund”, the draft indicates.  The company will have to establish track access charging methodology until 2015 and the value of the basic charging elements for the calculation of the track access charge.
Although the document mentions the fact that CFR SA will elaborate the calculation of the Track Access Charge, this process will not be executed only by the company, the European Bank for Reconstruction and Development being also involved. “The railway infrastructure manager was able to establish on his own the TUI, but the Ministry of Transport controlled this process. But now the situation is changing. The European Bank for Reconstruction and Development has granted us most of the funds for the execution of infrastructure projects and to make sure that it will recover its money. Actually, it is not EBRD that will elaborate the calculation method of TUI, but together with a consultant it will check the calculation manner and TUI coefficients. Therefore, when the consultancy company and EBRD will reach the conclusion that TUI is too small and will come up with another correct and a viable calculation method, we will have to apply it”, declared Constantin Manea, Operations Deputy General Manager – CFR SA, within the Conference “Infrastructure development – priority railway projects” organised by Club Feroviar and the Romanian Railway Industry Association, on February 20-21, 2013 in Sibiu, Romania.
At a simple analysis, if the train/km traffic indicator for 2013 is lower than the one of last year, the activity decreasing, and the network maintenance for the length of 10,637 km is also necessary (the same length as last year), we will be entitled to believe that CFR SA might be determined to increase the TUI, since the charge represents 95% of the company’s income. Likewise, according to Annexe 2, the train/km traffic indicator for 2013 is decreasing from 85 million train/km to 79.78 million train/km (passenger traffic decreasing by 5 million train/km compared to 2012), since the length of the network managed by CFR SA is once again estimated at 20.2 thousand km compared to the 15.7 thousand km in 2012.
Compared to 2008, the first year when the activity contract of CFR SA was signed, quality and performance indicators have dropped from 92.87 million train/km (passengers-68.22 million train/km; freight-24.65 million train/km), to 85 million train/km (in 2012) and 79.78 million train/km (in 2013).
Therefore, as regards the impact on the business environment, the Draft Decision mentions that the application of the new proposed methodology using the value of the basic charging elements for the calculation maintains the statistical average value of the TUI registered at present for the freight and passenger traffic. Nevertheless, the charge could be increased the company invested in the infrastructure improvement to allow the increase of the train speed. “We cannot increase the TUI as we wish since this could lead to an imbalanced situation which implies the operators’ activity, the traffic level, including our activity. But we want to execute projects for the infrastructure quality increase. If through the investment granting, we will manage to bring the infrastructure to the European standards, then the TUI could increase” also stated Manea.

Modernisation projects in preparation:
Km 614-Gurasada (102 km). Val.: EUR 1.08 Billion. Execution period: 2014- 2020
Gurasada-Simeria (42 km). Val.: EUR 404 Million. Execution period: 2014- 2017
Braşov-Predeal (26 km). Val.: EUR 769.8 mil euro. Execution period: 2016 – 2020
Craiova-Calafat (108 km). Val.: EUR 487 mil euro. Execution period: 2016 – 2020*
Craiova-Caransebeş (227 km). Val. (the most expensive alternative): EUR 2.755 Billion. Execution period:  2017 – 2020*
Caransebeş-Arad (155 km). Val. (alternative 2): EUR 1.18 Billion.
Execution period: 2017 – 2020*
* under the circumstances of financing insurance

Completed projects and projects under progress
The modernisation of railway stations: 21 stations in 2012-2015.
Investment val.: 210 mil euro. Execution period 2012 – 2015.

The equipment of the railway section Buciumeni Ramification-input signal in Brazi
station (38 km) with ETCS/ ERTMS Level 2 equipment. Contract val. EUR 39 Million.
Execution period: 2011-2014

[ by Pamela Luică ]
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