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The case for West Gate Tunnel looking wobbly in light of Port Rail shuttle return

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It was looking flakey already but now with the announcement over the weekend that the on-again, off-again rail port shuttles are back on the agenda, the West Gate Tunnel project has gone beyond barely scraping through the sniff test to stinking to high heaven.

The West Gate Tunnel Project was a market-led proposal from Transurban that would see new segmented lanes on the West Gate Freeway from the Western Ring Road interchange leading into a tunnel and then a bridge over the Maribyrnong, culminating in an enormous new road deck above Footscray and an interchange with the Western section of Citylink, Dynon Road and Wurundjeri Way.

The Port Rail shuttles have been in the public domain for a while now and is based around the concept of three intermodal road-rail freight terminals in key suburban locations. The last mile of containerised freight would shift away from driving, instead heading to one of the three terminals where trains would take containers to the Port, and vice versa.

Compare these headlines.

The first answer in the project website's FAQ states "The West Gate Tunnel Project is a city-shaping project that will deliver a vital alternative to the West Gate Bridge, provide quicker and safer journeys, and remove thousands of trucks off residential streets".

The opening line of Sunday's announcement joint Federal and State media release says "The Australian and Victorian Government are investing in projects to take trucks off local roads and connect the Port of Melbourne to major freight hubs using the existing rail network".

Both the fresh announcement and the project claim to do similar things - remove trucks from residential streets / local roads - but one of them simply shifts them to another road, the other removes trucks from the inner-city entirely.  Some might argue they can compliment each other yet another argument is which project would shift the most truck trips away from local roads, therefore, freeing up public money for other projects?

The bare bones

Two of the three proposed suburban intermodal hubs are in a very good position, right from the get-go: Altona in the south-west and Somerton in the north are both located adjacent to the interstate standard gauge rail network.  

It's this network that is already entirely segregated from the broad gauge metropolitan network - segregation of freight and passenger services is the holy grail as it would enable the two networks to scale as needed when the freight or passenger carrying task demanded it.

Future capacity constraints on single-track sections of the interstate standard gauge network within Melbourne notwithstanding, it appears the only major works required in order to connect the Port of Melbourne directly to these two sites is building the points and tracks leading from the main lines into the sites - like building a new off-ramp from a freeway.

The Altona site is less than a kilometre from the Princess Freeway/Kororoit Creek Road interchange and the Somerton site's bare bones are already there, directly fronting the Hume Highway and approximately 3-4km from the Cooper Street and Hume Freeway interchange.

The Lyndhurst / Dandenong South site is problematic because the standard gauge network does not cross into Melbourne's east and freight trains would need to mix with metro and v/line services on the two track railway between the Port and Dandenong and the single track, but easily duplicated, railway on the Cranbourne line.

The state government might point to all the rail investment happening in the south-east (the Caulfield-Dandenong level crossing removals, the Metro tunnel project, the new signalling system and new trains) which all good and well, however the pressure to build even more capacity on this corridor through quadruplication - from two tracks to four - is a constantly bubbling under the surface and is not being addressed.

Bringing the La Trobe Valley closer to Melbourne through decreased journey times on V/Line trains with their own express paths through the south-east, decreasing journey times from the outer suburbs by adding permanent express services on the Dandenong corridor, relieving pressure to continually expand the Monash Freeway by an extra lane every 5 years and an increased rail freight task; this pressure is only going to increase and it can only, efficiently, be addressed with an expansion of track.

Get out of jail free?

Regardless of the limitations at the south-east intermodal site, both Altona and Somerton sit neatly with what Infrastructure Victoria advises the state government to do: make existing assets work harder.  Building track connections and sidings, duplicating single track sections & upgrading signalling, building a new rail terminal (or set of terminals) at the Port - they're all upgrade tasks, not new-build infrastructure like the West Gate Tunnel.

According to the Department of Treasury and Finance's website, the 'Western Distributor' project as it was originally known is currently at stage four of five in the market-led proposals hierarchy.  

Given the opaque nature of market-led proposals, we the taxpayer don't know if there is any get out of jail free card available to the government and should there be one. The West Gate Tunnel Project's progress should pause while a rigorous study into impacts of the port rail shuttles project is conducted and then compared to the business case of the West Gate Tunnel project.

If Port Rail shuttles reduce truck movements from the west and north for a small but not insignificant amount of public money better than shifting those movements to a multi-billion road tunnel then we ought to know this.

Not surprisingly urban design issues are mounting against the West Gate Tunnel. A ludicrous double-deck Footscray Road section to the expansion Wurudjeri Way, complete with triple-stacked interchange that would dump cars in the inner-city, is straight out of the 1960s suburban transport planning textbook.

This project will lessen the value of redevelopment zones already earmarked.  Remember E-Gate?

The Port of Melbourne where it currently resides is going to be with us for at least another 50 years but that shouldn't force the inner-west and the West Gate Bridge into serving increasing amounts of trucks entering and exiting the port over that time.

Let's do the right thing - what should have been done at an earlier stage of the market-led proposal process for the West Gate Tunnel project - let's pause it while a robust case for the Port Rail shuttles is completed and compared to the West Gate Tunnel business case.

7 comments

johnproctor's picture

while I'm no great advocate for Westgate Tunnel other recent headlines you've ignored are that the port will grow from current levels of 2-3 million TEU to 6-8 (or even 10-12 million) in time.

Given the existing congestion (on the west gate bridge and bolte) and truck problems in the inner west and that expected level of growth its probably reasonable to assume that an increase in road capacity and rail capacity will be required to handle the growth in container traffic.

I think the transport planning commentary here is simplistic at best and absolutely ill-informed.

The 'gut feel' of armchair planners/engineers/economists/journalists doesn't outweigh the assessed benefits of a project, even if you don't like the outcome.

This project assessed by the same people using the same methodology that couldn't make East West Link stack up has significantly better BCR. Being ideologically opposed to roads with no analysis to back it up is just as silly as being ideologically obsessed with them.

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theboynoodle's picture

I'm not remotely informed enough to comment on whether this is a good project or not.. but I do sense an unwavering "roads = bad" and/or "Transurban = bad" tone to a lot of the commentary.

Roads are a part of urban infrastructure and just because they have, in the whole, been given far too much weight in the conversation for decades, that doesn't mean that any specific project should be slammed.

The one thing that does strike about this is that whilst Transurban made the proposal (which is fine in itself as far as I am concerned) part of what makes it stack up for *them* is an extension on tolling rights for a different road. Does this project really stack up, economically, if it needs to be funded by a different one? Do all these benefit analysis' take account of that? If the benefit of this road is enough to outweigh privatization of income from the other road for another 20(?) years, then why can't it fund itself?

If Transurban are hedging their risk by locking in profit from elsewhere to cover this project in case it doesn't deliver (again, fair enough when the outlay is in the billions) then has the state government locked in a share of the upside if the new road is a tolling triumph?

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pdoff's picture

I see your points JOHNPROCTOR and THEBOYNOODLE, but I must be from the same unwavering ideological school as the author. Just a couple of additional points that I think also should be made.

I don’t know how far into the future the port is forecast to generate 10-12 million TEU but if it is, as I suspect, closer to the end of the port's lease term than the start of it, the infrastructure requirement for that kind of capacity will be decades past the completion date of the Westgate Tunnel. If rail investment planning had similar time horizons we’d be building a full blown metro right now based on a forecast 8 million inhabitants by 2050.

The ‘gut feel’ of armchair urbanists are also important (planners and journalists may somewhat capture this) and the article is written from an urbanist’s perspective. Its points regarding the project’s detrimental effects on the urban realm are sound. This project delivers far too much road capacity (and by extension vehicles) to the inner urban area and is also damaging to future development potential. These effects aren’t detected by a BCR.

The BCR is important to the extent that the decision is an economic one. I’d contend that even the East West Link would have come up favourable if instead of a tunnel it was a surface freeway slicing through parkland. But pre-existing minimal urban standards which have evolved since the 1960’s would never allow that to happen. I tend to think of this project as another test of those standards, but because it happens to sacrifice urban potential rather than parkland and has a solid BCR the ALP seem to think they avoid appearing as hypocrites.

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George D's picture

The other huge factor here PDOFF, is that of full port automation and autonomous vehicles.

It's 2017, and we already have vehicles of limited autonomy. Few would predict wide adoption in the next five years, but you'd be stupid to bet against the next fifty. Similarly, changes to container handling at the POM are likely to be dramatic and allow much greater movement with greater efficiency.

Any investment based on the patterns of today for the patterns of the next 30 years will be poorly matched.

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johnproctor's picture

We are building a Metro based on Melbourne @ 8 million. Metro Tunnel business case benefits rely on exactly the same growth as road projects and has a BCR of 1.1 or whatever it is...

I didn't dispute the urban design aspects of the article. I pointed out that the transport planning components basically quote 2 lines from 2 press releases as if that means something.

I do agree that BCR doesn't take into account negative impacts particularly well.

In essence the BCR is based on about 20 years worth of benefits as beyond that timeline discount rates bring the benefits back to nothing in todays dollars anyway. So conceivably the 'urban potential' of the port land could still be achieved beyond that timeline by demolishing the elevated section of road after it has already reached its economic (not structural) life.

I have myself often mulled over the value of Citylink tolls and how they would best be utilised. I had been of the opinion that getting the tolling rights back into state hands as quickly as possible was the best way to get value out of them. I now believe that if the tolling rights were returned to state control quickly (earliest date under initial contract I believe was 2031) then the populist in every politician would simply remove the tolls and we'd have a induced traffic party all over Melbourne.

This government is effectively selling the tolling rights to Citylink to get Westgate Tunnel built (with a 30-40% input from the state). Whether Westgate Tunnel is the right project to have done that for I don't know but overall I agree with the strategy.

The other thing about toll road BCR's is that they are economic not financial assessments. So while Westgate Tunnel and Metro Tunnel are roughly equivalent in BCR economic assessment (although how that is the case I don't know as Metro Tunnel is beyond essential for hte ongoing success of Melbourne) they are poles apart in financial management for the state...

An $11 billion Metro Tunnel costs the state budget $11 billion in real dollars to build. The $8(?) billion Westgate Tunnel project will cost the state budget $1-2 billion with tolls either from the new road or the extension of Citylink tolling rights covering the rest. In an ongoing sense the tolls also cover the full operational costs of the toll road, where as running trains in the train tunnel is another financial cost to the state covered at about 30 cents in the dollar by train fares.

If anyone has any ideas on how to overcome that budget reality then you might do better than decades worth of rail network planners have at getting in the ear of governments and particularly treasurers to significantly increase rail budgets.

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theboynoodle's picture

@ Johnproctor

The tolls (on both roads) are as much a part of the cost as the cash outlay. If the state built the road independently it could charge those tolls. If Transurban's rights to toll on the other road expire then the state will have every right (which it would doubtless exercise) to continue to raise those tolls.

Transurban's plan is an alternative funding model, and it may (should) mean some sharing of risks and rewards. But the cost to us, be we road users or just simple taxpayers, is the same either way (assuming that we get value for whatever Transurban make on the deal)

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Nicholas Harrison's picture

It is assumed in the modelling for this project that the Port Rail Shuttle will not be constructed until at least 2032. This is an unusual omission since the state government has announced that Expressions of Interest for the project will be sought later this year.

Another omission has been the consideration of induced demand. This is the position of VicRoads for any road modelling done in Melbourne:

“...induced demand from making additional journeys can be assumed to be negligible and need not be dealt with in the transport model."

This policy was introduced just before the business case for the east west link was released so that induced demand would not have to be considered for that project.

Infrastructure Australia disagrees with this position and has stated that:

"Induced Demand is a known factor when building new motorways and yet it is still something that appears to to be lacking in the design phase of modern roads in Australia"

Infrastructure Victoria also disagrees and has stated that:

"More roads and more trains create more demand for transport. The underlying problem is that additional transport capacity creates or ‘induces’ more demand for that
capacity."

Conveniently the current government has not changed that policy so the Business case for the West Gate tunnel does not include any induced demand.

Infrastructure Australia required NSW to include induced demand after their initial business case for Westconnex did not include it. The analysis indicated that allowing for induced traffic reduces the present value of benefits by approximately 25%.

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