Effect of subsidies on Dutch rail freight unclear

source: Wikimedia Commons

Due to the corona pandemic, it is not yet possible to determine the effect of the temporary subsidy scheme for stimulating freight transport by rail in the Netherlands. This is the conclusion of the Knowledge Institute for Mobility Policy (KiM) in an interim analysis of the subsidy scheme that was introduced in 2019 to stimulate rail freight transport.

The ministry of Infrastructure and Water Management (IenW) has asked KiM to investigate whether the subsidy scheme, which was introduced for the period 2019 to 2023, has led to an increase in the share of freight transport by rail.

Subsidy scheme

The subsidy scheme was established in 2019 to improve the market position of rail freight transport compared to other modes of transport and is part of the Rail Freight Transport Measures Package. The aim was to bring the user fee back in line with Germany. A certain subsidy amount applies per kilometer driven, depending on the weight of the train. The total budget is 70 million euros for the period 2019-2023.

14.4 million euros was paid out in 2019 and 14.8 million euros in 2020. According to KiM, this subsidy means a discount of approximately 50 per cent of the user charge, and thus a reduction of the costs for rail freight transport across Dutch territory by approximately 10 to 15 per cent. The subsidy scheme has now been running for more than two years. KiM’s evaluation is linked to the decision taken this year to extend the subsidy scheme until 2023.

Developments affecting rail freight transport

KiM has established that various developments influenced rail transport in 2019 and 2020. The corona pandemic in particular had an exceptionally large impact on rail transport and freight transport as a whole in 2020. In addition, according to Intraplan (2021), the reduction in the user charge for rail freight in Germany and the increase in tolls for freight traffic had a noticeable impact.

The analysis establishes that rail freight transport (in tonne-kilometres) on Dutch territory increased by 0.8 per cent in 2019 compared to 2018. In 2020, on the other hand, it decreased by 6 per cent, the strongest decrease in 10 years. As a result, the market share of rail in international freight transport decreased from 8.5 per cent in 2018 and 2019 to 8.2 per cent in 2020. This decrease is mainly the result of the corona crisis in 2020. The knowledge institute indicates that due to the effects of COVID-19 there is no observable effect on the market share in 2020.

Earlier growth

By comparison, between 2010 and 2020, transport performance increased by 12 per cent to 6.7 billion tonne-kilometres. The highest level was reached in 2019, namely almost 7.1 billion tonne-kilometres. International inbound and outbound rail transport, measured in tonne-kilometres, appears to have grown slightly in 2019, namely by 0.1 per cent, while total international inbound and outbound transport (road, rail, inland shipping and pipeline transport) increased by 0.2 per cent.

In 2020, rail transport fell more sharply than the other modes of transport, namely by 6.6 percent. In the previous period (2010-2018), international inbound and outbound rail transport – except in 2017 – showed steady growth that was higher than that for the other modalities. Only the use of pipeline transport increased more.

Effect of the corona pandemic

The effect of COVID-19 on rail freight transport can be clearly seen in the second and third quarters of 2020 (see table). During that period, especially international exports measured in cargo tonne-kilometres fell sharply. It will recover quickly in the fourth quarter, bringing the transport performance above the level of the fourth quarter of 2019 and 2018.

Rail transport benefited from the barriers in inland shipping caused by both low and high water levels. Road transport suffered from border blockades in 2020, but less so from traffic jams. Coal transport was affected by the closure of the last coal mines in Germany and the temporary shutdown of coal-fired power stations in Germany in 2020. The growth of container transport was also noticeable in rail transport in 2019 and 2020.

Share modal split

In the international transport market, rail freight performed relatively better than road transport in 2019. The transport performance of rail freight in international inbound and outbound (excluding transit) grew slightly in 2019, i.e. by 0.1 per cent, while total international inbound and outbound (road, rail, inland shipping and pipeline) grew by 0.2 per cent and road transport decreased by 0.6 per cent.

The share of rail freight transport in international arrivals and departures remained the same in 2019 compared to 2018, namely 8.5 per cent. In 2020, the total transport performance of international rail transport fell sharply, namely by -6.6 per cent compared to +0.9 percent for road transport and -3.3 per cent for total international arrivals and departures.

The share of rail transport in international freight transport decreased to 8.2 per cent, and thus fell below the level of 2018. The decline in rail freight transport in 2020 was not limited to the Netherlands. Rail freight transport in Germany also showed a 6 per cent drop in the transported volume in 2020. The decline in transport performance was smaller in Germany, namely 4.2 per cent compared to 5.9 per cent in the Netherlands.

According to KiM, in order to achieve the growth target of the Rail Freight Transport Package of Measures for 2030, i.e. approximately 57 million tons in the low scenario and approximately 62 million tons in the high scenario, the weight transported must increase more in the coming years than in that package of measures. provided. This is because the transported weight decreased to 40 million tons in 2020.

Author: Marieke van Gompel

Marieke van Gompel is editor of RailFreight.com and chief editor of the ProMedia Group online magazines.

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