Sunday, 31 August 2014
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The week ahead: High speed trains, energy bills and electric vehicles come under scrutiny

Its with no sense of irony that Briefing focuses this week on transport and energy, two elements of national infrastructure taking - or forecast to be taking - a battering from St Jude right now.

A big week for rail sees the Office of Rail Regulation (ORR) deliver its final determination on Network Rail’s Strategic Business Plan, and MPs debate HS2’s budget in the Commons following the publication tomorrow of the proposed new line’s final business case.

Network Rail published its five year Strategic Plan in January this year, with ORR determining that over £2bn worth of savings could be found through the implementation of new technologies, better management of the railways and more efficient ways of working. Network Rail is expected to publish its final delivery plan in March 2014.

MPs will vote this week on whether HS2 will proceed following the publication of a new business case for the high speed line.

As many as 60 Conservative Party MPs are said to be preparing to vote against the rail scheme that was thrown into further disarray over the weekend.

On Saturday The Times reported on David Cameron’s misgivings about the scheme if it fails to secure cross-party support, arguing that private investment funding would not be forthcoming without it.

The Labour Party has aired concerns about the project’s budget, a figure that sits at £43bn and won’t be supported by the party if it creeps over the £50bn mark.

Cameron is widely reported to have said: ‘If Labour are to run away from this, they will be letting down the Midlands, they will be letting down the North.’

The third and final reading of High Speed Rails (preparation) Bill is scheduled for Thursday October 31.

Tomorrow sees energy company bosses and Ofgem face questions from MPs over price rises and profits.

The Energy and Climate Change Committee will take evidence from bosses of the so-called Big Six energy companies in the wake of parliamentary and public disquiet over the latest wave of electricity and gas price rises.

The session will explore issues including: reasons and justification behind the recent increases; difference in pricing policies between suppliers; and how the transparency of energy company profits can be improved.

Witnesses include E.ON chief executive Tony Cocker, SSE managing director William Morris; RWEnpower external affairs director Guy Johnson; and British Gas managing director, Energy, Ian Peters

Macquarie, a provider of banking, financial, advisory, investment and funds management services, believe the carbon tax should be scrapped as its makes domestic energy supplies more expensive than imports.

In a report in today’s City AM they say the tax is ‘counterproductive from an environmental, economic, and taxation point of view and therefore unsustainable….We see a £15 to £20 per MWH difference between power prices with and without this floor, which is about 10 per cent the retail bill.’

Alternatively Fuelled Vehicles (AFVs) don’t have a particularly large market share in Britain but they are slowly gaining traction. August’s figures from SMMT show year-to-date registrations had reached 18,785, an 8.2 per cent rise compared to 2012.

By 2050, however, the European Commission expects electric vehicles alone to play a significant role in reducing transport sector CO2 emissions by 60 per cent.

To this end, Plugging the Sustainability Gap: Boosting the European Electric Vehicle Market will examine the existing market entry barriers for alternative vehicles.   

Taking place in Brussels tomorrow, the one day conference will look at deficiencies in the sector - the limited range of models available, high costs and long recharge times, vehicle safety, consumers reticence and a claimed lack of significant price incentives - in order to take to take it forward.

Their reasoning is compelling when considering the approximately 12 million jobs in the EU’s automotive sector.

The organizers, Public Policy Exchange, say: ‘The automotive industry is vital to the economy and, as such, developing innovative and alternative fuels will not only maintain competitiveness and create high-skilled employment opportunities, but also make the European economy more resource efficient.

‘The electric and alternative vehicle sector has grown steadily over the past few years and the benefits of a thriving market are potentially significant, especially if considered alongside other technical developments such as intelligent transport systems and smart grids.

‘Nevertheless, several important developments have taken place, which it is hoped will raise awareness and boost the fledgling EV and alternative fuel market in Europe.’

Finally, a report from think-tank Civitas says government should take a more interventionist approach to industry or risk losing thousands of jobs to rivals.

The report - Picking Winners: How UK industrial policy ensured the success of the aerospace and automobile industries - recommends the introduction of a public finance scheme be introduced to support domestic suppliers to the automotive industry, and major investment in new technologies which do not attract enough involvement from the private sector.

The aerospace and automotive sectors, which Civitas describes as ‘the two main surviving success stories of UK manufacturing’, face pressure from global competition and could be lost to nations such as China, Japan and Brazil whose governments are prepared to invest heavily in sectoral development.

The report recommends that a public finance scheme be introduced to support domestic suppliers to the automotive industry, and major investment in new technologies which do not attract enough involvement from the private sector.

The aerospace and automotive sectors, which Civitas describes as ‘the two main surviving success stories of UK manufacturing’, face immense pressure from global competition and could be lost to nations such as China, Japan and Brazil whose governments are prepared to invest heavily in sectoral development.

Commenting on today’s Civitas report, Richard Surridge, divisional manager for Aerospace and Automotive at Matchtech, said: ‘Confidence in government support of the engineering industry has continued to lag from an engineer’s perspective as was highlighted by the results of our Confidence Index.

‘This survey, compiling the opinions of more than 1,000 UK engineers on the future of their industry, found that over half of UK engineers had lost confidence in government policy towards the industry.

‘The survey also found that 56 per cent feared that organisations will stop investing locally, and 43 per cent would actually be willing to desert the UK and move abroad for work.

‘The UK’s engineering industry has been a source of pride and prestige for centuries and we want it to stay that way. Politicians need to ensure they’re offering their full support to what was historically the backbone of British endeavour in order to ensure that the industry can continue to compete on the world stage. To do this, it is imperative that we start by making sure we’re nurturing the best talent here at home.’


Readers' comments (13)

  • Clocks just gone back, winter darkness taking hold, miserable weather, energy bills climbing, storms forecast, unions getting itchy, Cameron and his incumbents saying yes, and labour saying no just to disagree. It's a wonder we are not all looking for employement in sunnier climes. Although on a brighter note, prospects looking up by 2050 for electric vehicles and lower CO2 emissions, wow! hope I've still got a driving license.

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  • It is so sad that the decision on HS2 comes down to the politics of "who can we blame". It is strange that, at this late stage, we are still trying to come up with a business case. If this project was any good then the justification should have been sound from the start. i.e. before we spent money on the design etc. The fact that we are still trying to justify it suggests that the case was unsound in the first place. If the argument is now not about speed but about capacity and "connectivity" then why set a design speed of 400kph? This high design speed means higher costs (both construction and operating costs) and limits the route by having a very large minimum curve radius. It is time to show this scheme as the vanity project it has been from the start.

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  • In general I agree with Rob Hill but it always was about capacity. I don't mind the speed as a bonus but the arguments in the UK are not as compelling as they are on the Continent where there are much bigger distances. We only have HS1 for political reasons - it really wasn't worth while building it for 50 miles or so.

    The effect of speed will be to increase the commuter belt size around London - people seem prepared to travel for say an hour each way.

    A major opportunity was wasted with the upgrade to the West Coast line some years ago not to increase the size of rolling stock that could be accommodated - Stephenson-sized carriages cannot go double decker (it may be possible with some clever design and short people!) and it took them years to add extra carriages. Running 3 trains an hour Manchester to London really fills up the signalling slots, along with all the other trains running to other places on the same track.

    The problem when the coalition took office was that HS2 was seen as an alternative to expanding London's airport capacity, which was stupid as even with the best will and no price escalation, HS2 to Manchester/Leeds won't be available for 20 years while extra airport capacity was required in 2010 and if started now could be available within 5 years.

    Now the penny has dropped that some (Tory) constituents will be unhappy, we see emerging dissent which is entirely Nimbyism that has latched onto the increased cost (ie contingency) as an excuse. Expanding critical parts of the route to 4 tracks will, it was claimed today, cause delays for 14 years or so! Probably the HS2 lobby's response to Nimbies!

    I back immediate expansion of Heathrow plus building more rail capacity, which you can call HS2 if your like. The speed is not relevant unless it is extended to Scotland - which may not even be part of the UK by then anyway.

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  • @Rob About sums up the HS2 folly.

    The idea of moving people around for business reasons is going to become more of a non-requirement in the future anyway.

    What we will need is low cost transport of goods and the movement of non-business users, non of which the HS2 can deliver.

    To be honest I have my doubts about rail transport anyway - its just to expensive and inflexible.

    Maybe the way forwards is a better road system with an electric infrastructure and autonomous vehicles perhaps even combining into trains!

    You can do a lot of R&D and implementation work with 50+ Billion

    Time to drop the blinkers and look to the future!

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  • Surely, some of what is proposed for HS2 is just another example of my assertion that , leaving the clerks to make up our technology based and biased minds, will allow them to allocate funds (ours) to do faster and faster things that are less and less necessary.

    I am reminded of the definition of a professor -with the increased specialization of technology- that he/she is a person who knows more and more about less and less, until in the ultimate, they know everything about nothing!
    Mike B

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  • HS2 is interesting from the political view as it seems all about politics and not about the scheme itself.

    It would be failing the Midlands says Cameron, but isn't the proposed scheme already doing that? By not running through at least one of the major city centres of the East Midlands it is already doing that. Nottingham. Derby, and Leicester already have city centre stations so why are they being missed.

    Supporters of the scheme argue that it will run through Toton, but that's in the middle of nowhere in reality, but what about Leicester.

    Clearly the route hasn't been thought out very well, and it will be funded by loans, so more debt for the future, is it really working? not in a lot of peoples minds.

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  • I am not a great supporter of HS2 for the reasons already given and I would prefer to see more connectivity in the north of England - that is the bit of land between Leeds and Scotland where HS2 will have little or no impact and is hardly mentioned. Indeed, if the Government was serious about helping the north and at the same time wanted to increase confidence in HS2, then why doesn't it build a loop through Edinburgh, Glasgow, Preston, Manchester, across to Leeds and York, and back up to Edinburgh via Newcastle. Only then should the umbilical linking it to London be built! That way would minimise the 'pull' effect of London, and cancellation would not be so easy.

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  • @S.Martin Toton is the main depot for freight operator DB Schenker, so a passenger line through a freight area, the logic is there perhaps...

    Major technological decisions these days are about politics and in the past, but on a positive note after many years of studying Engineering at various levels I didn't have a lesson in politics....thank goodness.

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  • And why has Labour's proposal to reopen the Grand Central line to Sheffield only just resurfaced. Was it not in the original list of alternatives, or was HS2 proposed as the solution to a problem that had not been defined? It would certainly increase rail capacity to the Midlands and North if that is the primary objective, and in a much shorter timescale.

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  • I have been in America recently and I was wondering why the UK can't have double-decker trains like the Americans do? Presumably there are places where engineering would have to be done to make this possible but it still seems like it need not involve building a completely new high-speed capable track.

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