High Speed Rail - Transport Committee Contents

Written evidence from Mike Vernon (HSR 110)

The strategy for HSR appears to be co-dependent upon UK energy policy and this raises a specific concern re development of HS2 as set out in the consultation paper/economic case.

Having reviewed the technical papers there are concerns that:

The published costings for the construction and running of HS2 do not fully take into account the impact of the government's policies designed to meet the UK's carbon emissions reduction targets. In particular, they do not include any allowance for the impact of the introduction of the recently announced Carbon Price Floor measures from 1 April 2013.

Furthermore, it is felt that the complexity of the range of UK and EU measures designed to encourage the introduction of low-carbon generation technologies may mask a more serious underlying problem. This problem is the uncertainty about the supply of electricity in the medium term brought about by the necessity to achieve emission reduction targets. Achievement of these targets is likely to result in widespread closures of fossil fuelled power plants before the end of 2015. The potential reduction in supply and consequent increase in the price of electricity would affect all aspects of the construction and running of HS2. It is felt that this uncertainty about electricity supply and price should be taken into account in the costing of the project.

The government is committed to full compliance with EU Directive 2001/80/EC Limitation of Pollutants Directive. This in effect states that unless the UK's major fossil fuelled power plants conform to EU emission standards they will have to cease operating, which could mean that by 31 December 2015 25% of our largest fossil fuelled power plants will have to shut down. The government has also stated that all but one of the UK's nuclear power plants (Sizewell B) will be shut down by 2025. The likely consequence of these closures would be an upward pressure on electricity prices, and until the introduction of significant levels of low-carbon generation capacity, fossil fuels will continue be provide the bulk of UK electricity generation. The carbon price support mechanism will therefore continue to inflate electricity prices throughout the construction period for HS2, and this should be factored in to the estimated costs of the project.


—  Can it be confirmed that there are specific plans in place for government to increase the supply of energy and therefore support the increased demand for power arising from investment in HSR?

—  Will revised cost estimates be published in the near future to take into account the effects of energy price increases resulting from (a) carbon tax increases and (b) possible supply constraints?

—  When the rising costs of energy are fully reflected in the business model for HS2, what impact does this have on ticket prices -or the requirement for additional government subsidy—and therefore the achievement in the growth of passenger numbers forecast in the business case [which in turn underpins the case for HS2].
Key pointsEvidence
By 2015, 25% of the largest fossil fuel plants are planned to close, as part of the UK Government's commitment towards reducing carbon emissions. EU Directive 2001/80/EC Limitation of Pollutants Directive [replaces DIR 88/609/EEC]
Also government has also stated that all but one of our nuclear power plants [Sizewell B will be shut down by 2025] [see attached list of plant closures]: and as yet there are no plans in place to replace these plants. See attachment 1
The UK government has committed to reducing carbon footprint and has announced the introduction of a carbon floor pricing policy wef. April 2013, which will have the impact of increasing the price of power production from fossil fuels. HM Treasury HMRC Document/Carbon Floor Price Consultation—The Government Response: March 2011 pdf]
Transportation within the UK in general contributed 24% of all CO2 emissions in 2007. BlueSpace Thinking Ltd April 2010—Review of High speed Rail—HS2 Proposals
The business case for HS2 is based on the premise of incentivising a substantial increase in growth of long distance travel within England—specifically, from several major cities into London - through subsidised travel on the new HSR network. Consultation Document on HS2
The new system will uses more power than a conventional inter-city train and so must increase our CO2 emissions significantly. The technical report identifies that a 3.5 minute time saving between Birmingham and London achieved through higher speed adds an additional 23% to the energy cost for the journey. So as with other forms of transport, the very high speeds proposed in HS2 require disproportionately more energy use. HS2 Traction Energy Modelling Report 31/12/2009
The operating costs presented in the business case are "high level" and the technical report states that more work is required on in-depth costing analysis. No cost escalations have been factored in on original 12.3 billion pound costs for London to Birmingham route. All costs are based on 2009 figures. Page 4 s 1.1.5 Cost and Risk Model Tech Annex 0.4

May 2011

previous page contents next page

© Parliamentary copyright 2011
Prepared 8 November 2011