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Railway line capacity utilisation and its impact on renewal costs

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Abstract

In this paper we estimate the impact of line capacity utilisation on the marginal cost of rail infrastructure renewals. Previous studies are mainly concerned with deterioration costs caused by traffic. This paper contributes to the literature, showing that increased line capacity utilisation can – in addition to higher deterioration costs – generate increased costs for carrying out a renewal project and/or more frequent renewals, where the latter can be motivated by efforts to curb expected delays. A top-down econometric approach is used on a Swedish dataset comprising information on renewal costs for track, electric installations, signalling, telecommunication, and other installations such as barriers, fencing and lubrication equipment. The results are relevant for rail infrastructure managers, especially in Europe where directives by the EU stipulate that track access charges are to be based on direct costs in order to contribute to an efficient use of the infrastructure.

Suggested Citation

  • Odolinski, Kristofer & Lidén, Tomas, 2021. "Railway line capacity utilisation and its impact on renewal costs," Working Papers 2021:1, Swedish National Road & Transport Research Institute (VTI).
  • Handle: RePEc:hhs:vtiwps:2021_001
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    Keywords

    Marginal cost; Capacity utilisation; Renewal; Rail infrastructure; Access charging;
    All these keywords.

    JEL classification:

    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
    • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy

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