Midlands Rail Hub Midlands Connect Strategic Outline Business
Midlands Rail Hub Midlands Connect Strategic Outline Business Case 18 July 2019 Final
Overview – Objectives and Benefits The Midlands Connect Strategy identified a significant opportunity to improve connectivity between the major cities of the Midlands, and to improve links from the South West into HS 2. • The Midlands Rail Hub comprises a number of infrastructure interventions in and around Birmingham, and along key Strategic Corridors in the Midlands that will enable provision of up to 10 additional trains per hour into Birmingham, in both directions, from key economic centres. • These trains will provide more frequent, and in some cases faster, connections to and from Birmingham with key economic centres such as Nottingham, Leicester, Bristol, Cardiff, Worcester and Hereford; improving journey opportunities for rail customers and east/west connectivity across the Midlands. • The programme will also provide better connectivity between HS 2 and regular rail services to locations which under current plans do not gain any significant benefit from HS 2. Routing some existing services from New Street to Moor Street Station, which is adjacent to the HS 2 Curzon Street Station, places such as Hereford, Worcester, Bristol and Cardiff have easy access to HS 2. • The MRH is a scalable programme, able to be delivered in stages to enable some ‘quick wins’, medium term improved services and longer term opportunities. At this stage the full programme could be delivered in stages up to 2033, with the intention to plan delivery in order to maximise synergies with HS 2. • If we don’t act now we will fail to provide adequate rail service levels to meet growth in customer demand, fail to make the most of the opportunity provided by HS 2, and risk the loss of productivity and economic growth by failing to provide the transport connectivity needed to access economic opportunities. The Midlands Rail Hub is expected to drive the following benefits (based on the full “B 1” programme; there are partial options available) : • £ 500 m additional revenue to the industry (2010 PV) • Time savings to passengers valued at £ 1500 m • £ 500 m wider economic benefits due to making substantial improvements to connections between major cities, less than an hour apart • Facilitating 36 additional rail freight paths per day • Total Economic Benefits £ 1100 m (excludes leisure/commuting) • The total funding requirement is anticipated to be c. £ 800 m (2010 PV, Capex+Subsidy) • This SOBC requests [c. £ 20]million of funding to develop a preferred technical solution and report the results in an Outline Business Case. 2
Delivery Options – Overview of Performance Analysis undertaken for the SOBC has identified a range of different infrastructure and operational options which could contribute to the overarching objectives. The following provides an introduction to the findings of the SOBC and further work needed at the next stage: • One option for quicker gains is to consider altering the pattern of operations at Birmingham New Street. This could take the form of consolidating terminating into through services and thus freeing-up operating space for a small number of MRH train services. Altering operations at New Street is likely to increase delays significantly, and substantial mitigation would be required before there could be industry acceptance of this approach. This option also does not readily provide scope for further growth. Pursuing this option will need further timetable and performance modelling, and also the examination of complementary infrastructure interventions during the OBC stage. • Properly fulfilling the MRH objectives does appear to centre on the case for the Bordesley Chords. Building these chords enables a more substantial reorganisation of services coming into Birmingham, moving some from New Street into Moor Street and allowing opportunities to provide new and faster services. Other interventions are required to achieve the full capacity and speed objectives of MRH, but these two chords are pivotal elements. • There appears to be a good economic case emerging for the West Chord, which allows more services from the southwest (Hereford, Worcester, Bristol, Cardiff and also the local ‘Camp Hill’ services), and in particular allows them to connect with HS 2 at Curzon Street. In the OBC stage consideration needs to be given to delivering it sooner, right-sizing, value-for-money opportunities, and to the most effective arrangements between Kings Norton and Barnt Green. • The economic case for the East Chord, which would allow additional and faster services from the East Midlands into Moor St, is promising, but needs further work in a staged approach to the OBC. Opportunities need to be investigated for improving value-for-money, and delivering it sooner. Interventions to further improve journey times from Leicester, Derby and Nottingham need to be developed, to identify potential synergies from these corridors. Further modelling is required to better understand the relative effectiveness of direct services to Nottingham city centre compared to using HS 2 and interchanging at East Midlands Hub. 3
Potential Early Interventions Work on the SOBC has identified a number of interventions which could come forward as early phases to either act as enabling works to the wider programme or to enable early benefits to be realised. These include: Potential Intervention Outputs Estimated Cost (£m, 2018) Earliest Delivery Date (subject to funding) Snow Hill Platform 4 In the longer term, this facilitates more services in Moor Street. Also realises complementary benefits for the Chiltern and West Midlands franchises, allowing them to directly serve the expanding Snow Hill office district. £ 15 -25 m 2022 -4 Kings Norton In the longer term, this facilitates fast services to/from Moor Street. Also contributes to enabling initial Camp Hill local service while preserving existing connectivity. £ 15 -30 m 2022 -4 Barnt Green Facilitates an additional service from south west by making provision for heavy freight trains. This would run from Hereford/Worcester into New Street, and could form a service to the East Midlands. £ 20 -30 m (MC Estimate) 2022 -4 Leicester Corridor Allows a speed benefit on existing Leicester services and/or new services running through from the South West. Potential for incremental speed improvements at several junctions. £ 150 -200 m total, if all locations implemented (MC Estimate) 2024 Nottingham Corridor Allows a speed benefit on existing Derby corridor services and/or new services running through from the south west in the Burton area. £ 40 -60 m (MC Estimate) 2022 -24 There will also be short-term opportunities with the Cross. Country franchise extension to consider whether extra and better trains would allow the franchise to resolve overcrowding and improve its offer to key business markets. 4
Contents Strategic Case Economic Case Midlands Connect Strategy 7 Interventions & costs 27 Problem Identification 9 Options Appraisal 28 Impact of not changing 13 Value-for-Money Commentary 29 External drivers for change 14 Value-for-Money Opportunities 30 Objectives & Measures for success 15 Scope 16 Overview of: Constraints 17 Financial Case 31 Interdependencies 18 Commercial Case 32 Stakeholders 19 Management Case 33 Options 20 Recommendations & Next Steps 34 5
Strategic Case 6 6
Midlands Connect is the Sub-national Transport Body for the Midlands. We research, develop and recommend strategic transport infrastructure. The first Midlands Connect Strategy was endorsed by the Secretary of State for Transport and published on 9 th March 2017. The Midlands Rail Hub was a key part of that strategy. The Midlands region lies at the heart of the UK’s strategic transport networks, connecting Wales, the North, Scotland the South of England to each other. This means that the transport network plays a crucial role in accommodating longdistance trips across much of the UK, as well as regional trips between economic centres, and more local trips. Since 2014, the Midlands Connect Partnership has been undertaking technical work to determine the location and magnitude of the interventions required to power the Midlands Engine and capitalise on the major opportunities associated with the arrival of HS 2 in the region from 2026 and 2033. Improving transport connections between Midlands economic centres will transform the economic structure of the Midlands, harnessing agglomeration effects, and making it greater than the sum of its parts. Midlands Connect is defining the strategy to enable that to happen, and is working with Highways England, Network Rail, HS 2, and other partners, to move that strategy towards delivery. 7
Midlands Connect Strategy The Midlands Connect Strategy 1 presented evidence on the structure of the Midlands economy, and how it could be transformed by improvements to connectivity. Business & Professional Services 2 is a major economic sector in the region, accounting for 23% of GVA, and is highly concentrated in the city centres, but connectivity between cities is poor. Business & Professional Services productivity in the Midlands is 21 -39% below the UK average, with plenty of scope to upgrade. Improving links between city centres will give existing and new businesses stronger links to customers, suppliers and markets, making them more outward-looking and competitive 3. This is expected to attract higher gross-value-added businesses, and drive increases in productivity through competition, making better use of existing and new employees. The proposed improvements focus on travelling for business, throughout the day, between cities upto about an hour apart, where the opportunity is greatest. The improvements will also enable businesses to access a larger pool of high added-value employees. In consultation with businesses, the strategy targeted 70 mph 4 centre-to-centre journey speeds on the key corridors, providing a sense of urgency, and journey times under an hour. This represents a substantial improvement on typical car journey speeds (40 -50 mph). Car journey speeds already reflect the availability of motorways for most inter-city journeys, but are unavoidably limited by urban congestion at either end of the journey. As such, rail is the only practical means of achieving this level of service. The Independent Transport Commission has confirmed that the Business & Professional Services sector is a disproportionate user of rail services for both business travel and commuting, and that there is a strong historical relationship between growth in the sector and rail use 5. The Midlands Connect Strategy also includes improvements to the highway network, but these are more focused on supporting the manufacturing, agri-food and logistics sectors, which are strongly dependent on highway access, and located away from city centres accordingly. For the Business & Professional Services sector, the economic effects come from centreto-centre journey times that are markedly better than the underlying journey times by road. 1 Midlands Connect (2017) https: //www. midlandsconnect. uk/publications/midlands-connect-strategy-march-2017/ 2 SIC Codes J-N – Information & communication, Financial & insurance, Real estate, Professional, scientific and technical, Administrative and support service technical 3 Centre for Cities (2018) https: //www. centreforcities. org/publication/the-wrong-tail/ 4 For instance two fast trains per hour at 70 mph, usually with additional slower services making a 4 tph overall frequency. Compare with Leicester-Nottingham (65 mph). 5 Independent Transport Commission (2018) http: //www. theitc. org. uk/wp-content/uploads/2017/05/ITC-Report-Rail-Passenger-Demand-November-2018. pdf 8
Problem Identification The problems identified by the Midlands Connect Strategy that are being targeted by the Midlands Rail Hub programme are: East – West Connectivity Connecting large business centres Nottingham to Birmingham Leicester to Birmingham Linking South West to HS 2 Hereford to HS 2 Bristol/Cardiff to North Additional opportunities: enabling local services on the Camp Hill line, faster or more reliable journey times to the South West, efficient provision of passenger capacity, freight capacity 9
Problem Identification (1): Connecting Business Centres • The largest Midlands centres for Business & Professional Services are Birmingham, Nottingham, Leicester and Coventry. • 2015 Cambridge Econometrics forecasts for 2037 show large growth for Birmingham (+30, 000) and high percentage growth (+20%) for both Nottingham and Coventry • There are multiple large development sites and enterprise zones in central Birmingham and Nottingham. Leicester’s regeneration area covers the whole city centre, taking a fine-grained, place-based approach, with the station anchoring one corner. There is a ready supply of housing, reasonable prices, and scope for more. • Journey speeds by rail Nottingham-Birmingham (44 mph) and Leicester-Birmingham (50 mph) are notably poor, and constrain business use. They are slow because there are no separate fast services, with trains having to serve intermediate stops as well. Despite the evident demand, it isn’t possible to run separate fast services between these places, because of a lack of capacity for more trains into central Birmingham. • Hence the Midlands Rail Hub: looking at ways of operating more trains in the Birmingham area, and also looking at running these extra services fast to key destinations across the Midlands. Birmingham Nottingham 2011 2037 Leicester 10
Problem Identification (2): Linking South West to HS 2 will provide very fast connections in three directions from Birmingham, and release capacity on adjacent corridors, towards London (2026), and to the North West and North East (2033). Bristol and Cardiff are major business centres (the fifth and sixth largest locations for Business & Professional Services jobs in England & Wales). Office Jobs (2011) Connections via HS 2 from Bristol/Cardiff to Manchester/Leeds become available with HS 2 Phase 2 b (2033) and are strongly enhanced by MRH, allowing journey time reductions of upto an hour compared to today. This leaves a significant gap in connectivity to the south west, compounded by poor access to the HS 2 network at Birmingham Curzon Street, involving changing stations and a 500 m walk Analysis for the Midlands Connect Strategy identified significant benefits from improving links between HS 2 and the south west, particularly linking Bristol, Cardiff, Worcester and Hereford. Midlands Connect Strategy Journeys from Hereford, Malvern and Worcester to Birmingham, Manchester, and Leeds are potentially made significantly faster by making the connection to HS 2. Combining these markets enables the modernisation of the underdeveloped Hereford. Birmingham corridor. 11
Problem Identification (3): Additional Opportunities There is very strong partner interest in Camp Hill local services from places such as Kings Heath and Moseley. These already have high public transport use into the city centre, but these are slow and unreliable journeys by bus. Provision of rail services is constrained by the lack of capacity for additional local frequencies into Birmingham New Street. A new link into Birmingham Moor Street for SWHS 2 connections would also enable these local services. Journey times from the South West into Birmingham have upto 8 minutes of padding in the timetable. This is because fast trains have to slot between stoppers on the approach to New Street. There is a section of fourtrack through Northfield, but this requires a tight overtaking slot, which is unreliable. The route via Moseley into Moor Street would simplify some of these interactions, allowing faster and/or more reliable journeys. 2011 Census © OSM / Andy Allen Crowding – there is some peak overcrowding, particularly on the Leicester and Nottingham corridors. This is likely to be solved by longer trains when re -franchising. However, providing the required capacity is relatively expensive, due to the integration of stopping and longer-distance services. Separate long-distance/fast and short-distance/slow services would help resolve crowding, by enabling costefficient lengthening. Freight – the Midlands Connect strategy identified capacity requirements for freight growth at two key bottlenecks – Water Orton and Leicester. Growth is likely to be significant for both construction and container freight, in line with the 2016 Df. T Rail Freight Strategy, with this particularly affecting the Birmingham-Nuneaton. Leicester corridor. 0519 0622 0722 0822 0922 1022 1122 1222 1322 1422 1522 1652 1722 1822 1922 2022 Network Rail Route Study (2023 Crowding) Network Rail Freight Market Study 12
Impact of not changing Without improvements in rail connectivity and service levels, there will be a constraint on productivity growth in the Midlands economy, and constrained business growth through loss of inward investment and fewer new jobs created. Reduced business connectivity / agglomeration potential - constrained access for people and businesses to economic opportunities (employment, skilled labour, services, markets, supply chains) leads to loss of productivity and constrains future economic growth. • Poor connections between economic centres particularly between east and west (due to both slow speeds and insufficient frequency of services) is constraining access to highly skilled labour markets and hampering productivity growth, particular issues exist around the Birmingham/Leicester and Birmingham/Nottingham routes • Business & Professional Services Productivity (GVA per job) in the Midlands is 21 -39% lower than the UK average. • Infrastructure investments are required along with the additional routes so that freight can continue to run effectively on the routes and not displaced on to the roads Forecast job growth will not be achieved • Insufficient rail connectivity and capacity between key economic centres to meet the needs for the high forecast job growth in 2030, particularly in Birmingham and Nottingham. By 2030, the number of jobs in the Midlands is expected to increase by around 322, 000 to 6. 05 million in 2030 [Barriers to Growth, 2016]. Total growth in employment in Birmingham in the Business & Professional Services sector alone 2016 to 2030 is expected to grow by over 60, 000 [Barriers to Growth, 2016]. • Good rail connectivity and adequate service levels (e. g. frequency, journey times) are needed to support the creation of these new jobs, particularly in key economic centres. In Birmingham for example, the rail mode share of trips into the city at peak times grew from 17% in 2001 to 38% in 2016 [Atkins study, 2017]. If rail capacity constraints are addressed, the forecast job growth can be better supported. Longer travel times increase direct business costs and result in productivity loss: Professional services sector respondents state that long rail times create the main impact on their business (along with other problems such as punctuality and fares) [Barriers to Growth, 2016]. 13
External drivers for change As well as the Midlands Connect driver for change, there are strong external drivers that align with the proposal: • There continues to be strong local rail commuter growth linked to the growing Birmingham economy – the projected growth 2013 -2043 equates to 140 extra carriages (or 2. 2 carriages per morning high peak arrival) [WMC Route Study]. This can largely be accommodated by lengthening trains, and a substantial quantity of additional carriages have already been committed under the new West Midlands franchise. However, on some urban corridors, frequencies are low (sometimes only 2 trains per hour), and West Midlands Rail Executive strongly support increasing frequency towards 6 tph within the built-up area where feasible, and affordable [West Midlands Rail Investment Strategy, Dec 2018] “All options were on the table when we started thinking about the location of HSBC UK’s new head office but Birmingham emerged as our number one choice. The revitalisation of the UK’s second biggest city and its connectivity make it a really attractive home for UK businesses and their employees. ” • Transport for the West Midlands, in their local transport strategy, Movement for Growth [2016] includes strong support for public transport, and restricting car use in congested areas such as Birmingham city centre. This includes support for the development of local rail services on the Camp Hill corridor, and new stations on the Water Orton corridor. This has been strongly endorsed by the West Midlands Mayor, who has made starting work on Camp Hill local stations a key target. NIGEL HINSHELWOOD HEAD OF UK AND DEPUTY CEO HSBC BANK PLC • Df. T has set out its Vision for Rail [Connecting people: a strategic vision for rail, November 2017], including specific mention of Midlands Rail Hub [para 2. 41]. There is also national policy support for rail freight growth generally [Df. T Rail Freight Strategy] • Network Rail have an established and very strong aspiration to find a way of increasing capacity for more services into central Birmingham, to meet demand for connectivity and passenger capacity [WMC Route Study] • Transport for the East Midlands also have aspirations for improved rail services across the region, including better rail links to the West Midlands. A key element to this is getting the most out of HS 2, including regional connectivity to East Midlands Hub, where significant development is expected. • HS 2 is arriving in Birmingham from 2026, and is likely to drive a considerable further expansion of city centre employment, and rail commuting, providing opportunities for synergy (Quoted in Greater Birmingham & Solihull Strategic Economic Plan 2016) • LEP Strategic Economic Plans feature strong development of city centre Business & Professional Services, especially in Birmingham, Nottingham, Coventry, Leicester, with good connectivity seen as a key enabler for this. 14
Objectives & Measures for success Business Strategy Problem Identification Objectives & Measures Flowing from the Business Strategy, and the Problem Identification, we have identified these Core and Supporting objectives and measures Core objectives Measure for success Outcomes Notes Faster Nottingham-Birmingham 2 tph in c. 50 mins Increased business travel Nottingham-Birmingham additional, to preserve existing Faster Leicester-Birmingham 2 tph in c. 40 mins Increased business travel Leicester-Birmingham additional, to preserve existing Linking Bristol/Cardiff/Hereford to HS 2 3 tph fasts to Moor St Increased business travel Bristol/Cardiff/Hereford. Manchester/Leeds/London additional, to preserve existing Enabling the Camp Hill local service provision for 2 tph stoppers Supporting objectives Measure for success Timeliness / HS 2 Synergy some outputs in time for 2026 Room for further growth Low-cost add’l freight & passenger (eg 2 tph to east, 2 tph to west) Punctuality similar to current Existing Connectivity unchanged service is separate business case freight benefits and incremental costs have not been quantified yet treated as a constraint at this stage 15
MRH Scope • Midlands Rail Hub is intended to deliver additional fast all-day services between Nottingham, Leicester, Hereford, Bristol, Cardiff and Birmingham, and also enable provision of a local service on the Camp Hill line. • A key assumption, by Df. T instruction, is that all phases of HS 2 are delivered 20262033, and that variations are out-of-scope. • The focus of the work to date has been on providing additional paths that can be used by limited-stop services. Further work will be needed in the development stage to fully understand speed-improvement opportunities. • In line with the Western Route Study [August 2015], no interventions were assumed to be required from Bromsgrove towards Bristol and Cardiff, beyond that already underway as part of Great Western electrification, resignalling and re-quadrupling of Filton Bank. The route study indicated that this level of service could be accommodated with relatively minor service alterations, rather than requiring infrastructure interventions. This will need to be confirmed in the development stage to ensure that the additional trains and faster services can be achieved. • Similarly, no interventions were assumed to be needed on the route from Derby to Nottingham. A separate study has been looking at the impact of HS 2 shuttle workings, and has broadly confirmed this assumption, though the slowest (third) Nottingham service would likely have to be diverted via East Midlands Hub from 2033. No interventions were also assumed east of Nottingham/Leicester, because there are no changes to the number of services. • The scope excludes consideration of the case for expanded local services, though “scope for further growth” is a supporting objective. • The scope includes freight growth in line with Network Rail’s Freight Market Study, subject to a degree of flexibility in discussion with the Industry Working Group. 16
Constraints Existing Service Constraints Assumed for MRH: • Providing additional railway services takes place within the context of a regulated network • Existing rail services have formal access rights, and train operators have expectations regarding their ability to expand their operations (particularly freight operators, though this can apply to passenger operators) • Df. T and other funders may have expectations regarding their ability to specify service enhancements that also use the network (for instance, local services) • Existing operators have a right to object to any change to the network, and while these can be over-ruled, such objections are usually negotiated. As such, we have taken the continued provision of existing services as a constraint • We have taken forecast freight growth as a constraint, subject to a reasonable degree of operational flexibility. We also recognise that this growth is in many places contingent on capacity being available, and there will not always be a business case for making that capacity available. Known significant capacity constraints, given existing or forecast services Central Birmingham severe performance risk with adding any new services at New Street Station New Street - Barnt Green 11 tph existing services, significant speed differential (especially New St-Kings Norton, and compounded by complex interactions due to scheduled overtaking in the 4 -track section) Bromsgrove - Hereford single line sections and long signal blocks (semaphore signalling) Water Orton 8 tph existing services plus freight crossing the main line, 4 min headways, substantial forecast freight growth Kingsbury difficult access to, and egress from the freight terminal Derby corridor speed differential (stoppers) Leicester corridor speed differential (heavy freight) 17
Interdependencies Midlands Rail Hub has a very strong interdependency with HS 2 • HS 2 Phase 1 generates benefits for MRH by linking Hereford-London via Birmingham, which will be significantly faster for time-sensitive business travellers than the infrequent direct services via Oxford (or alternative connections via Newport) • HS 2 Phase 2 b generates benefits for MRH by linking the South West to Manchester/Leeds/etc, saving upto an hour on current timings • HS 2 Phase 2 b abstracts demand from Nottingham-Birmingham corridor • HS 2 stimulates Business & Professional Services growth in Birmingham (2026 and 2033) and Nottingham (2033), offering strategic (unquantified) synergies • HS 2 “released capacity”, including the potential diversion of the Newcastle-Reading service via Coventry, may help free slots at New St (2026) • HS 2 Shuttle services, particularly between Derby and East Midlands Hub, make for a new constraint at Sheet Stores (Trent West) junction, for which there is as yet no clear resolution, and which may well limit the long-term potential for additional conventional services on the Birmingham-Nottingham corridor Leicester • There is an established capacity constraint in the Leicester area, particularly for freight. The previous project to resolve the constraint with full quadrupling and a grade-separated junction was cancelled on affordability grounds. Freight growth is expected to be substantial, both aggregates on the Midland Main Line corridor and containers on the Felixstowe-Nuneaton corridor. The combination of freight growth and HS 2 shuttle services has the potential to prevent MRH Leicester-Birmingham services from operating, if no intervention is forthcoming. Network Rail are undertaking a study in 2019/20 which it is hoped will identify a more-incremental and affordable approach, probably focused on providing more freight infrastructure, and maximising capacity at junctions. • Midlands Connect is also promoting a scheme for re-opening a direct link between Coventry and Leicester, with services running through to Nottingham. As semi-fast “through” passenger services, these are not expected to exclude the operation of MRH services, but that will need to be tested. 18
Stakeholders Stakeholder Engagement The MRH project governance has a strong emphasis on engagement and understanding of interfaces. The following has been undertaken throughout the SOBC development period: • Strong engagement with transport authorities (MC partners) via the Midlands Connect Technical Advisory Group (TAG) • Strong engagement with rail industry (NR & TOCs) via the Industry Working Group • Direct project governance arrangements include Df. T, WMRE, Tf. WM, Tf. EM/EMC, NR* Stakeholder Concerns Some key issues have arisen during the SOBC, and these have been considered within the scope and options testing: • Staffordshire County Council wish to retain Tamworth/Burton stops in long-distance services • Leicester and Nottingham City Councils want to maintain the link to New St for connections • Tf. WM/WMRE wish to understand how MRH can provide for local services, both the Camp Hill service (which is directly in-scope) and future additional services. • A desire from across the Midlands Connect Partnership to see some real change as soon as possible. * Tf. WM = Transport for the West Midlands, WMRE = West Midlands Rail Executive, Tf. EM = Transport for the East Midlands, EMC = East Midlands Councils 19
Options (1) – Pre-SOBC Analysis Prior to Midlands Connect starting work on the SOBC for the Midlands Rail Hub, a number of earlier studies and publications laid the platform for the eventual scope of this SOBC: • 2015/6 – Network Rail, working with the Train Operators, developed the idea for new chord links at Bordesley to increase capacity in central Birmingham, as part of the West Midlands and Chiltern Route Study (under their licence obligation to study the long-term development of the rail network). The Route Study concluded that Birmingham New Street was full, given the existing pattern of services. • 2016/7 – Midlands Connect, as part of developing their Strategy, sifted a long list of hundreds of possible transport schemes from across the Midlands. The concept for a Midlands Rail Hub (MRH) was selected as 1 of 11 priority rail schemes for further development. An Enhanced Strategic Case looked at broad service specification options, either focused on Midlands-scale services, local services or both. This recommended a package of 10 services to/from Birmingham, focused on the NE/SW axis, and largely focused on Midlands-scale services, but also including provision for some new local connectivity. Midlands Rail Hub was awarded £ 5 million of funding from Df. T to undertake this SOBC on the back of the MRH Enhanced Strategic Case and the narrowed-down option of 10 additional services. • 2017/8 – the Midlands Rail Hub analysis of Timetable and Constraints identified a set of interventions that would enable provision of the 10 services. Analysis at this stage identified that the Hereford, Bristol, Cardiff, Leicester and Derby/Nottingham services all potentially made good contributions to overall benefits, though a 3 rd additional on the Derby/Nottingham corridor was not value-for-money. The Constraints analysis confirmed that only a very limited number of services could operate through New Street, with significant performance risks. A performance model was commissioned to enable these options to be tested. 20
Options (2) – Rationale for SOBC Options • The starting point for the SOBC was to look at the Network Rail Route Study option of chords linking to both east and west (shown in red on the map). These would allow services from the south west and/or east to run into Moor St, using spare approach and platform capacity (orange), rather than to or through New St (light blue). This was also likely to involve some trains that currently terminate at Moor St being extended to Snow Hill, to release space at Moor St for the new services. • But the SOBC analysis also needed to consider options to run more services through New St. In line with recent service developments, this could include running “peak extra” services all day. This would better serve the all-day business market. These should run through New St, reducing conflicts in the eastern throat; but understanding that this was nevertheless likely to have a negative punctuality effect. Options should therefore look at operating restrictions & reducing conflicts to make the performance risk tolerable, at least as an interim phase. • All phases of HS 2 are included in the “Do Minimum”, by agreement with Df. T. Options therefore needed to understand the differential impact that HS 2 Eastern Leg has on the case for the East chord (weakened) and the West chord (strengthened). • Therefore we needed to consider the East Chord and West Chord separately and together • Given that HS 2 releases capacity on the Derby corridor, there may be less need for “scope for growth” towards the east • While there is a pre-HS 2 case for giving priority to running fast to Nottingham, any interventions need to be adaptable and appropriate to a longer-term role. • It was agreed with Df. T and NR that the SOBC would need to understand how the scale of MRH could vary, depending on the infrastructure need. i. e. the full 10 additional trains per hour was not a fixed requirement. 21
Options (3) – Identified Options Using earlier analysis and a rationale for options identification and assessment agreed with stakeholders, the following options are a summary of those tested in the SOBC programme. These were used as a means to understand how varying the number of additional trains assumed could impact on the final value for money case: Making Best Use of New Street Options • +4 tph – Worcester, Cardiff, Leicester (x 2): Four new hourly departures from central Birmingham, incorporating existing peak-only services. These will need to include intervention at the Barnt Green and Water Orton bottlenecks. Running both the East Midlands services to Leicester is the long-term scenario. Before HS 2 Phase 2 b, running one or both of the additional services to Nottingham may be preferable. [Coded Df in Economic Case documentation] • +6 tph – Two Camp Hill local services in addition to the above: These are assumed to run through the “exchange siding” and into the low-numbered platforms at Birmingham New Street. This option is purely to test the impact of the Camp Hill services in terms of making alternative provision for turnback at Kings Norton, with no additional intervention in central Birmingham. [Dg] Utilising Moor Street Capacity Options • +4 tph – Leicester (x 2) & Nottingham (x 2): East chord option, assumes reinstatement of platform 4 at Snow Hill, but no widening of the main viaduct, and no additional platforms at Moor Street. Interventions also likely to be required on Derby and Leicester corridors. [C 1] • +5 tph – Hereford, Cardiff, Bristol, Camp Hill local (x 2): West chord option, assumes reinstatement of platform 4 at Snow Hill and relocation of sidings at Moor Street, but no widening of the main viaduct. Interventions also likely to be required on south west corridor. [C 2 plus KNN turnback] • +9 tph – Both sets of services as above: All interventions as above, but including widening of the main viaduct and additional platforms on the north side at Moor Street [B 1 plus KNN turnback] • +10 tph – Both sets of services as above, but with the addition of a further stopping service to Derby: All interventions as above, but with the addition of provision for overtaking at Burton. This option is reported as a sensitivity in the Economic Case, but did not perform as well as the 9 tph options and is not reported in this summary. Variants also tested: +1 tph/+2 tph terminating at New St (these were worse than +4 tph through-running); without redoubling west of Malvern Strategic alternatives considered – digital railway and traffic management 22
Options (4) – Identified Options (cont’d) These diagrams give an indication of the potential routes and stopping patterns, with services either running into Birmingham New Street, or Birmingham Moor Street. It also shows the approximate location of the potential interventions. The services to Kings Norton and Leicester are two trains per hour, all the others one train per hour. 23
Options Assessment Prior to the Economic Case, this assessment gives a broad summary of the expected outputs of the different options. The Red/Amber/Green rating is described in the Appraisal Specification Report, and reflects the degree to which the core and supporting objectives are met by the options. The New St options deliver some of the outputs to Nottingham and Leicester, and could do so by 2026, but with significant performance risk, and no scope for growth. The Moor Street options can deliver outputs to the South West, the East Midlands or both, but would take longer. Fast to Nottingham Fast to Leicester Base Link HS 2 to south west Camp Hill locals Early (2026) outputs Scope for growth Punctuality Key 4 New St (Df) * * Not applicable 6 New St (Dg) * * Objective met 4 East chord (C 1) Partially met 5 West chord (C 2+KNN) Not achieved 9 Both+viaduct (B 1+KNN) * Before HS 2 Eastern Leg, there are options to run both the additionals to Leicester, both to Nottingham, or one each. There also possibilities to use faster rolling stock on the Nottingham corridor, and/or to improve linespeed on the Leicester corridor. Once HS 2 Eastern Leg opens, there will be opportunities to recast services. 24
Economic Case 25 25
Appraisal Specification The following assumptions have been used to develop the economic case: • The options have been appraised in accordance with Web. TAG, using MOIRA 2 for the revenue and benefits modelling, with demand timetable adjusted to include the full delivery of HS 2. • Wider Economic Impacts have been assessed using WITA. • New Street options are assumed to open in 2026, and Moor Street options are assumed to open in 2033. • Operating costs were calculated using Network Rail’s operating cost model, based on current rolling stock (170 s). • The need for interventions was approved by Network Rail’s Capacity and Capability Analysis team, interventions were designed by Network Rail Design & Delivery, capital costs estimated use the Rail Method of Measurement, and approved by Route and National Panels. • The performance effects of the New Street options have been assessed using a new Rail. Sys model covering the whole study area, incorporating the May 2018 timetable, and current infrastructure (plus New Street resignalling). • More details on the assumptions and methodology are contained in the Appraisal Specification Report. 26
Interventions & costs Corridor Intervention Cost £m East Chord West Chord Both Chords Both + Viaduct 11 -13 Yes Yes Yes Central Snow Hill P 4 Central East Chord 120 -137 Central West Chord 140 -161 Central Both Chords (Option 2) 293 -337 Central Both Chords (Option 6) 395 -454 South West Kings Norton turnback 7 -8 South West Kings Norton remodelling South West New St +4 tph New St +6 tph Yes Potential lower cost option without viaduct widening Yes Yes Yes 8 -9 Yes Yes Barnt Green-Longbridge 4 -tracking 50 -58 Yes Yes South West Worcester Malvern signals 8 -10 Yes Yes South West Malvern Turnback 22 -25 South West Ledbury-Shelwick partial doubling Leicester Water Orton 4 -tracking 72 -83 Leicester-Nuneaton signals 36 -41 Derby Water Orton – Wichnor signals 17 -20 Yes Yes Derby Kingsbury Oil north access 26 -30 Yes Yes Derby Elford loop 5 -6 Yes Yes Derby Burton loops Used as an alternative to test Ledbury-Shelwick doubling 100 -115 98 -112 Yes Yes This table reports the estimated capital costs that have been identified for each location, and which interventions are required for each option. These costs are reported in 2010 prices, discounted to 2010 from the assumed construction date, adjusted for tax, and include an allowance for optimism (64%). The New Street options include the whole of the cost of Water Orton four-tracking, but none of the cost for the Barnt Green scheme. This gives an indication of the level of capex required. Used to support linespeed improvements (not capcity) Used for a +10 tph test (one extra on Derby corridor) 27
Options Appraisal This table extends the options assessment to include Value for Money (Vf. M) measures, capital costs, and subsidy requirements over a 60 -year appraisal period. The Vf. M measures are given an extended RAG rating, for cross-comparison with the objectives measures. Two adjusted Vf. M measures are shown, to include Wider Economic Impacts, and then (for the New Street options only) an estimate of the effect of reliability. The Moor Street options are assessed as being performance-neutral. Fast to Notting ham Fast to Leices ter Link HS 2 to south west Camp Hill locals Early (2026) outputs Scope for growth Punctuality Value for Money Vf. M with WEIs Vf. M WEIs & reliability Capex Subsidy with reliability TOTAL Capex + Subsidy 90104 100115 250287 323371 699804 376433 203 328 293307 303318 343380 287335 756861 469526 Base 4 New St (Df) 6 New St (Dg) 4 East chord (C 1) 5 West chord (C 2*) 9 Both+viaduct (B 1*) 4 East chord (as increment, B 1 -C 2) *Adjusted to include capex for Kings Norton turnback Vf. M: Poor Low Medium High Very High 93 -36 57 93 £m PV, 2010 prices and discounting Adjusted for optimism (64% capex, 1. 8% mature opex) 28
Value-for-Money Commentary on the current state of the Vf. M assessment, noting that further work at OBC will be focused on how to improve this, either through value engineering interventions or by seeking additional benefits from journey time savings: • The 4 tph New Street option has very significant reliability impacts, taking the Vf. M rating from Medium/High down to Poor. Substantial improvement is needed before this option could be acceptable. The Water Orton intervention was effective at improving value-for-money, and this supports the idea that further intervention is worth investigating. The New Street option does not include scope for growth, and interventions to support growth will also need to be considered, if this is to be acceptable as a long-term option. • The capital-cost impact of providing for the two Camp Hill local services (ie to terminate at Kings Norton) is comparatively small. • The West Chord has High value-for-money, and this should be developed further. Consideration needs to be given to earlier delivery, right-sizing, value-for-money opportunities, and to the most effective arrangements between Kings Norton and Barnt Green. • The East Chord, on its own, represents Medium value for money. As an increment on the West Chord, it represents Low value for money, because it then includes the cost of widening the Moor Street viaduct. The benefits associated with the East Chord are substantial (around £ 650 m, 2010 prices), but the costs are substantial. It may be possible to avoid widening the viaduct, by connecting the East Chord to the existing “Snow Hill” lines. This could have a substantially lower capex cost (around £ 110 m less, 2010 prices), but would come with a reliability impact, and less scope for growth. • The East Chord is currently the best option for delivering the faster to Nottingham/Leicester objectives. Synergies between speed and capacity enhancements along the corridors will need to be developed, to moderate costs and identify more benefit. Performance modelling is needed to understand the reliability impact of East Chord services using the Snow Hill lines. Widening the viaduct seems unlikely to represent sufficient value-for-money for Midlands Rail Hub outputs, and as such it does not appear to be an early priority for further development. However, an early decision will need to be made regarding development of the north-side platforms at Moor Street, due to the interactions with HS 2 Curzon Street, and the risk of the land being taken for other purposes. • For all options, the wider economic impact is approximately a third of the conventional transport benefits. This is a little higher than for instance HS 2, where the ratio is roughly a quarter. Wider economic impacts are driven by the size of the economies connected, the distance or cost of travelling between them, and how well connected each city already is. The wider economic impacts are expected to be high, because Bristol, Cardiff, and Hereford are quite isolated from the rest of the country, and Nottingham and Leicester have quite poor connectivity in all directions (except London). Improvements to connectivity therefore have a relatively large impact. A high ratio can also be a function of a suppressed rail market, where rail-only elasticity models potentially understate the level of conventional transport benefits. These issues will be examined further in the OBC. 29
Value-for-Money Opportunities Interventions for MRH have been designed in more detail than is usual for an SOBC, but there are still a range of opportunities to improve value-for-money that will need to be investigated at the Development stage. • The MRH study conducted a substantial new “GRIP 1” investigation of the chords at Bordesley / Camp Hill. This included preliminary civils, track and signalling design, to gain a good understanding of feasibility. A similar level of design was done at other locations, but with less iteration, due to initial designs appearing to deliver the capacity requirement in a feasible manner. • A comprehensive design has been estimated for each location, to get a thorough understanding of the potential costs. For the chords at Bordesley, the costs have been broken down for specific elements (doing the two chords separately or together). • Some designs include substantial civils work (reconstruction of bridges, embankment strengthening) which ground surveys or further design may reveal is not actually required or may have a significant renewals component. • Signalling schemes may also have a significant renewals component, and will generally require a more detailed timetable study to understand whether they are strictly necessary, or at least desirable on performance grounds. There may be opportunities for reducing infrastructure costs which should be examined in the OBC: • West Chord – options for the alignment need to be tested • East Chord – the alignment of the chord is heavily constrained; the principal questions relate to the inclusion of widening the main viaduct and constructing new north side platforms at Moor Street. Omitting these may require alternative interventions on the Snow Hill lines. • Kings Norton-Barnt Green – the broad approach of re-quadrupling the southern section looks sound, but needs to be iterated to be flexible to different service patterns, and reduce the complex timetable interactions. • Water Orton – this has so far been designed mostly for capacity. This needs to be iterated to consider a faster turnout speed towards Leicester. The fourth track west from Water Orton is relatively expensive, and needs to be tested for efficacy. • Ledbury-Hereford – increasing linespeed, and reducing the service specification to strictly 2 tph should be examined. This would mean that the additional Birmingham-Hereford service is curtailed when a conflicting London-Hereford service operates. • Burton-on-Trent – the provision for fast trains to overtake stopping trains does not appear to be necessary when only operating two additionals on the corridor (compared to the full specification which required three additionals), and does not appear to offer good value for money. 30
Financial Case • The capital costs for the options range from £ 90 m to £ 804 m (PV 2010 prices and discounting). • The subsidy requirement for the options range from £-36 m to £ 203 m, or £ 328 m including reliability impacts (PV 2010 prices and discounting) • The benefits of MRH largely accrue to businesses and society as a whole, so it is currently expected that funding will be from central government. However, Midlands Connect is keen to explore potential opportunities for third party funding contributions where appropriate. • Midlands Rail Hub is the flagship rail project for Midlands Connect, and expected to be prioritised accordingly if it delivers the intended range of outcomes. Nevertheless, there will inevitably be competing demands for funding from other projects in the Midlands, whether they are being promoted by Midlands Connect, Df. T, HS 2 (or indeed Local Transport Authorities and others). • Expenditure on rail in the Midlands was £ 916 m per year (2011 -2017 average), out of a total of £ 11. 6 bn nationally* • Midlands Rail Hub could therefore account for 10 -20% of historical spending levels on rail in the Midlands over a period of around 10 years • Whilst acknowledging that this is a significant sum, Midlands Connect considers this to be a reasonable ask of Government for a programme which could have transformative effects on the Midlands economy. * Extracted from http: //researchbriefings. files. parliament. uk/documents/CBP-8130. pdf, 2016/17 prices 31
Commercial Case Introduction • At this stage, only a limited assessment of commercial viability has been made Capital Expenditure • The interventions are potentially quite large, particularly the chords and the approach to Moor Street, but similar to previous schemes undertaken by Network Rail • The working assumption is that the interventions would be delivered by Network Rail and its supply chain, using their normal processes • There is only a small amount of infill electrification, wiring additional tracks on already-electrified sections between Kings Norton and Barnt Green, and no dependency on technological innovation is envisaged • There are risks around availability of resources (and/or cost) due to HS 2 and other construction projects Operating Expenditure • The services are expected to be procured as relatively small expansions of existing franchise arrangements, using conventional rolling stock and existing depots Development Stage • The current intention is to retain Network Rail (System Operator) as the main supplier for the Development stage, using a similar range of subcontractors (internal and external) as for the Determine stage, supported by their current framework contractors. 32
Management Case Introduction • At this stage, we have only made a limited assessment of how the full programme will managed and governed • The expectation is that the Design and Delivery stages of the programme will be delivered through normal Df. T/NR sponsorship arrangements, including use of the Rail Network Enhancements Pipeline, the Investment Decision Framework, and Network Rail’s GRIP standard. • It is not expected that there would be any direct link to the introduction of new rolling stock, or large-scale driver training programmes • It is not expected that this programme will require any unusual arrangements, and is well within the capability of Df. T/NR processes to manage Development Stage • The existing governance structure is expected to continue for the Development stage, subject to the Df. T’s normal Project Initiation processes. • Df. T is the client, with Midlands Connect acting as client’s representative. This is managed through the Df. T/MC/NR Programme Oversight and Assurance Group. • The governance structure includes a regular role for Tf. WM, WMRE, Tf. EM/EMC* on the Programme Management Group, and advisory roles for Midlands Connect local authority and other partners on the Technical Advisory Group, and for the rail industry on the Industry Working Group (in particular, recognising the constraint imposed by their rights as Access Parties) • Formal approval of the Development Stage procurement, interim and final deliverables will be sought from both the Midlands Connect governance structure (Steering Group and Strategic Board), and from the Df. T/MC Programme Oversight and Assurance Group * Tf. WM = Transport for the West Midlands, WMRE = West Midlands Rail Executive, Tf. EM = Transport for the East Midlands, EMC = East Midlands Councils 33
Recommendations & Next Steps This SOBC has clearly identified a case for investing in links between HS 2 and the south west, through further development of the Bordesley West Chord, and related interventions. This is recommended as the preferred option for this corridor, and should be developed to Outline Business Case level, including identification of key implementation (ie timetable) and cost risks. Consideration needs to be given to the quantum and balance of services between New St and Moor St, to avoid over-provision. In terms of improving the speed of Nottingham-Birmingham and Leicester-Birmingham, the problem has been clearly identified, and there are substantial benefits to be had, over and above the improvements due to HS 2 and the shuttle links to/from East Midlands Hub. The New Street option looks best from the point of view of delivering something quickly, but with a severe performance impact. The Moor Street (East Chord) option is considerably more effective. In both cases, there is a significant value-for-money challenge. To improve Nottingham/Leicester services, we are recommending that both New Street and Moor Street options continue to be developed at Outline Business Case level. Further performance modelling is required of the New Street area to identify whether sufficient mitigations (timetable or infrastructure) can be developed to make this an acceptable option, and whether scope for further growth can be included. For the Moor St (East Chord) option, we first need to develop the broader package, looking at interventions along the two corridors. This should generate synergies if speed improvements are included. We also need to investigate whether the reliability effect of linking the East Chord to the Snow Hill lines can be mitigated, so the cost of widening the viaduct can be avoided. These investigations will then form the basis for working further on the East Chord itself, identifying key cost risks, and enabling the cost estimates to be updated. There a number of potential early opportunities for delivery, including reinstatement of platform 4 at Snow Hill, some initial remodelling of the junctions at Kings Norton and Barnt Green, and speed improvements on the Leicester and Nottingham corridors, which Midlands Connect are keen to develop, together with our Partners. 34
- Slides: 34