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Norwegian railway authority miscalculates potential for night train Oslo – Copenhagen

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A night train offer Oslo-Copenhagen can start up in 2025 at the earliest. “Any offer will depend on public support and is not an effective climate measure”, writes the Norwegian Railway Directorate in an additional report, which has not been made public, but is dated 20.5.2022. We publish it here, and it is called Nattog Oslo-København, Tilleggsutredning. The earlier report that came on 1.11. 2021, and is called Vurdering av nattog OsloKøbenhavn was more optimistic.

The route Oslo – Copenhagen has one of Europes highest densities of flights evening and morning. There is not any direct day train, and a ferry boat is slow and costly.

Public attention to the additional report came through this article in ENERGI&KLIMA from 22.8. 2022, from where we are quoting in our translation (italic).

Several train operators have the expertise and interest in operating the route, the directorate’s investigation shows. The prerequisite is that a traffic agreement is entered into, i.e. that the public provides subsidies, in the order of NOK 24-43 million a year. This would mean that the state covered NOK 280 to 500 of the cost of each trip.

A night train offer will replace some flights on the route. However, the benefit to society from reduced emissions is no more than NOK 2-3 million, according to the directorate’s analysis.

“The discrepancy between the value of saved greenhouse gas emissions and the need for subsidies indicates that the measure cannot be considered an effective climate measure, and that a recommendation to go ahead with the measure must depend on other considerations in addition to those included in the analysis,” the report concludes.

The investigation has been commissioned by the Ministry of Transport as a basis for a decision on whether or not to go ahead with the night train initiative between Oslo and Copenhagen. The work the directorate has done is a follow-up and concretization of a first study that it made last year.

The additional report is unfortunately not very clear about the key figures. But Back-on-Track has been able to re-calculate some figures.

The calculation of the social benefit lacks any appropriate diligence

– The paper works with two occupancy rate scenarios, both very pessimistic (28% or 38% of what we estimate is the potential, see our estimates). 

– The paper calculates with saved „CO2″ so we must assume that the radiative forcing of non-CO2 Emissions was ignored. This reduces the saved CO2 to 72% of our value.

– The report indicates to assume that the passengers would otherwise use the plane. We assume 80% of the passengers would otherwise use the plane. 

– The differences would still result in social benefits between NOK 8m and 11m, so the paper must also assume a CO2 price of roughly 23 EUR per ton in 2022 and 64 EUR in 2040. That is very, very low.

But all this is speculative as the report does not outline how the calculation was done.

The key difference comes from the passenger potential estimations which assume to attract 3,5% or 5% of the total traffic.

The timeframe is competitive and could certainly attract a higher passenger share, particularly as there is no attractive day train alternative.

So the occupancy rate could certainly be adjusted, possibly by lowering the price and optimizing yield management, presumably without the need for higher subsidies, as the occupancy rate has a positive effect on income while having low effect on either investment or operational cost. 

But it has a high influence on the social benefit, particularly if you calculate with non-CO2 Emissions and current emmision permit costs.

So the assumed occupancy rate is a political question rather than a financial one. 

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