We regularly report on the development of competition on the rail in our brochure Competition Report.
Federal Government makes strong commitment to rail transport
In the coalition agreement of February 7, 2018, the Union parties Christian Democratic Union (CDU) and Christian Social Union (CSU) as well as the Social Democratic Party of Germany (SPD) have committed to strengthening the railway in Germany and to an integrated DB Group. The coalition agreement includes numerous topics that are important to the entire industry. The political target is to double passenger numbers by 2030 and to bring more freight transport to the rails. Focus topics for the sector from a DB Group perspective include:
- Continued capital expenditure increase providing the funds needed, in particular, for the existing network (LuFV III) as well as for expansion and new construction measures, implementation of a Planning Acceleration Act (Planungsbeschleunigungsgesetz), and application of building information modeling (BIM);
- Implementation of the master plan for rail freight transport µ63, in particular with train-path price support, realization of the 740 m network, and establishment of a Federal program Future of Rail Freight Transport for innovations;
- First steps into digital rail for Germany, including the accelerated expansion of European command and control technology ETCS no. 145 and digital interlockings;
- Further work on a synchronized timetable for all of Germany (Deutschlandtakt) including a target schedule and appropriate infrastructure measures;
- Strengthening of the rail mode of transport within the context of climate and environmental protection, including appropriate measures in the planned Climate Protection Law (Klimaschutzgesetz), a program for electrification and alternative drives, as well as continued commitment to noise reduction no. 25.
Regulatory and transport policy topics
National platform future of mobility launched
The national platform set up by the Federal Government, future of mobility (Zukunft der Mobilität), began its work with the constitutive meeting of the steering committee on September 26, 2018. The aim of the cross-modal platform is to develop recommendations for action. The work of the platform is subdivided into six working groups: Climate protection in transport; Sustainable mobility: alternative drives and fuels; Digitalization, automated driving and new mobility concepts; Securing the mobility and production site, battery cell production, raw materials and recycling, training and qualifications; Integrated energy (especially linking traffic and energy networks); Standardization, normalization, certification and approval. DB Group is represented in the steering committee and in the working groups Climate protection in transport and Digitalization.
Rail Future Alliance starts its work
On June 5, 2018, Federal Minister of Transport Andreas Scheuer announced the launch of the Rail Future Alliance (rail pact), which will swiftly address the targets and measures of the Federal Government with regard to rail policy. The Future Alliance, under the management of the parliamentary Secretary of State Enak Ferlemann, began its work on October 9, 2018. The contents of the Future Alliance were developed and discussed within five thematic working groups: introduce a synchronized timetable for all of Germany (Deutschlandtakt), build capacity, strengthen the competitiveness of rail, reduce noise emissions, and digitalization, automation, and innovations. DB Group participates in all the working groups and in the steering committee.
Master plan for rail freight transport is being implemented further
The implementation of the master plan for rail freight transport will continue as per the procedure thus far in order to supplement the work of the Rail Future Alliance. The rail freight transport round table held another meeting with the key representatives of the BMVI and from the sector on September 25, 2018. The implementation and associated monitoring required for all ten areas of action with the 66 measures should be continued with the highest priority. The immediate measure of train-path price support began in 2018. The associated funding directive was published following EU approval in December 2018 and apply retroactively from June 2018 for a period of five years. In 2018, funding of € 175 million was available, while in 2019, € 350 million is earmarked in the Federal budget. Immediate measures to be taken also include the Federal program Future of Rail Freight Transport, which seeks to strengthen innovation in the sector. There are plans for concrete financial backing and the development of a funding guideline.
Guideline on promoting the energy efficiency of electric rail transport
With the funding guideline that entered into force on August 9, 2018, the BVMI supports the TOCs if they improve the efficiency of their electric volume sold. The funding is combined with an annually achieved percentage improvement of energy efficiency in traction current usage. In 2018 and 2019, the initial limit for claiming the funding is subject to achieving a 1.75% specific annual energy-efficiency improvement, while in 2020, 2021 and 2022 the requirement is for a 2% annual efficiency improvement. A special bonus is granted if a threshold of 3% is achieved. In addition, evidence must be given of expenses for measures applied to improve energy efficiency. The grant amount is a maximum of 50% of the expenses for the measures applied to improve energy efficiency in the relevant accounting year. Each year, a grant amount of € 100 million is available. The program runs until the end of 2023.
Law to accelerate planning and approval processes
After publication in the Federal Gazette, the Law to Accelerate Planning and Approval Procedures in the Transport Sector (Gesetz zur Beschleunigung von Planungs- und Genehmigungsverfahren im Verkehrsbereich) entered into force on December 7, 2018. This law will streamline the planning and approval procedures for the expansion and new construction of transport infrastructure. From December 6, 2020, the Federal Railway Authority (Eisenbahn-Bundesamt; EBA), as well as being responsible for plan approval procedures, will also be responsible for upstream hearing procedures. During rail projects, traffic development forecasts will only be updated during the course of the approval procedure if a significant increase in traffic and noise can be expected or if the emission limit value is exceeded for the first time. In addition, in certain cases preparatory measures or partial measures can be initiated even prior to the plan approval decision being issued. In this case, the measures must be reversible and in the public interest. Furthermore, among other stipulations, the law stipulates that all plan approval documentation must be published online.
BNetzA defines tender awarding conditions for 5G frequencies
At the end of November 2018, the President’s Chamber of BNetzA determined that tendering and auction proceedings be conducted for the awarding of the 5G frequency contract planned for early 2019. The supply conditions it contains will be used to predefine the minimum requirements for mobile communications network operators, including for the coverage of transport routes. For rail, the decision is that “highly frequented lines” with over 2,000 passengers per day will be provided with coverage of 100 Mbit/s per licensee by 2022, and all remaining railway lines will be provided with coverage of 50 Mbit/s per licensee by 2024. This comprises about two-thirds of the total network. It is expected that the newly determined conditions will result in an improved mobile communications supply situation for rail passengers. The mobile communications network operators are criticizing the conditions under which the tender was awarded and have submitted an appeal against the decision. However, there are no legal barriers to performing an auction because the appeal does not have any suspensive effect. BNetzA has not yet indicated a concrete auction date.
Substantial parts of Mobility Package I renegotiated
Substantial parts of Mobility Package I must be renegotiated after the European Parliament’s rejection in July 2018 of the recommendations made by the responsible traffic committee on work and social conditions as well as market access to the European road transport business. The main contentious point continues to be the conditions under which the regulations of individual states on employment conditions in international road freight traffic should apply (deployment), what number of loading and unloading operations outside of the home state is permitted within what time frame (cabotage), and how driving and rest periods should be arranged in the future. A majority of members of parliament spoke in favor of aligning the employment conditions in Europe, although the position of Central and Eastern European states is opposed to that of the Western EU countries. This mindset is also reflected in the Council of the European Union. Nevertheless, the representatives of the member states communicated a common position in December 2018. A common position is still outstanding in the European Parliament. As a result, it remains to be seen whether an agreement can be reached between the Council and the Parliament before the new elections of the European Parliament at the end of May 2019.
Long-term strategy for reducing greenhouse gas emissions
In November 2018, the European Commission presented its new strategy for reducing greenhouse gas emissions in the period 2030 to 2050. In doing so, it presented a strategic vision for a modern, competitive and climate-neutral economy for Europe and gave an indication of how Europe should move toward climate neutrality by 2050. According to the Commission, common measures must be developed in seven strategic areas, including mobility, energy efficiency, and the use of renewable energies. In the transport sector, a cross-modal, integrated approach is to phase out the use of fossil fuels by 2050. The Commission calls on the other EU institutions to review this vision and to support it with appropriate measures.
Proposals for a multi-year EU financial framework
On May 2, 2018, the Commission proposed a budget amounting to € 1,279 billion for the new EU budget (MFF) for the years 2021 to 2027. The funds of the Connecting Europe Facility (CEF) are to be increased to € 42.3 billion for investments in trans-European transport, digital and energy networks, of which approximately € 31 billion are earmarked for investments in transport networks. In the current financial framework, the budget for transport networks is about € 24 billion. Top-ups come from a separate budget of € 6.5 billion for transport networks with a dual civil and military use. In 2018, the European Parliament argued in favor of additional resources of € 7 billion for the transport network. The Council of the European Union has not yet taken a position on the matter. Since the discussion on the CEF budget is embedded in the negotiations on the financial framework of the EU, no result is expected before the second half of 2019.
French rail reform resolved
The main topics of the rail reform in France as enacted in June 2018 are the gradual opening of the national rail passenger transport market to competition (market opening in regional rail passenger transport between December 2019 and December 2023, with longer periods for the Paris metropolitan area, in long-distance transport operated on a purely commercial basis as of 2020), the reorganization of the SNCF into a stock corporation permanently owned by the government, the removal of public servant status for new employees at the SNCF as of the start of 2020, the assignment of the passenger stations segment to the rail infrastructure operator SNCF Réseau and the order arranging an employee transfer in the event of an operator change in regional rail passenger transport. Alongside this, the government is planning to relieve SNCF group of debts to the tune of € 35 billion. Widespread strikes occurred in France from April to July 2018 in connection with the rail reform.