The High Court of Australia has dismissed the Australian Competition and Consumer Commission’s (ACCC) application for special leave to appeal the Federal Court’s decision on the sale of the Acacia Ridge intermodal terminal. Read more
Aurizon will invest $50m in low carbon locomotives such as battery and hydrogen-powered trains to meet a net zero goal by 2050.
The freight hauler and network owner will also look to maximise the benefits of the electrified freight network in Queensland, particularly as more renewable energy is fed into the grid.
Managing director and CEO of Aurizon, Andrew Harding said that the company was confident that technology would meet the company’s goals.
“We are confident that rapidly-advancing technology in the rail sector will unlock major benefits like we are seeing in motor vehicles, energy generation and general industry. Our focus will be low-carbon technology for our locomotive fleet which accounts for more than 90 per cent of Aurizon’s CO2 emissions.”
In addition to actions undertaken internally, Aurizon will also push for government action.
“We directly advocate for policy actions to increase the use of rail freight on key national freight corridors. Our aim is to ensure that rail freight remains competitive and part of the solution as the economy transitions to a low-carbon future,” said Harding.
The company’s commitment follows the latest Sustainability Report from the freight operator. In the report, Aurizon advocates for lowered electricity costs to reduce the risk of substituting electric locomotives for diesel-powered trains. In addition, Aurizon outlines that the company has been advocating for greater infrastructure investment, improvements to regulation and finding efficiencies at interfaces between modes.
To meet the goal of lower emissions, Aurizon said that it would be making significant investments in new rollingstock shortly.
“Aurizon is already working with other railroads and manufacturers on the early development of battery and hydrogen-powered locomotives for deployment in a heavy-haul railway environment. This includes options of upgrades to the existing fleet and new rollingstock. We would expect to see prototypes trialling on our network by 2025, as technology advances and costs come down further,” said Harding.
“Locomotives are long-life assets of 20 – 30 years. We have some significant decisions ahead in renewing our locomotive fleet – potential game-changers for the freight industry – when we invest in the next generations of rollingstock to power our business through to 2050.”
A new rollingstock operator is in the process of establishing itself to haul coal to Abbot Point.
Bowen Rail Company has applied for accreditation as a rollingstock operator with the Office of the National Rail Safety Regulator (ONRSR). If the application is successful, the Bowen Rail Company will legally be able to operate rollingstock.
The Bowen-based business, which according to reports is owned by mining company Adani, stated in an August press release that it will be focused on servicing the Abbot Point terminal, where Adani will export the coal mined at its Carmichael mine.
“Bowen Rail Company’s initial focus will be to provide haulage services to the existing Abbot Point export terminal using the industry’s most technologically advanced rail fleet.”
The press release states that the company has purchased locomotives and rollingstock, with the first four locomotives to arrive in 2021. Bowen Rail Company head of project delivery David Wassel said the type of locomotives purchased would enable the company to hire more broadly.
“The benefit of our fleet is that it can be operated by anyone once they have had the right training, regardless of their physical size, age or experience, which means we can open up operator-type roles to a much broader workforce and to people who haven’t necessarily worked in the rail sector,” he said.
“Our goal is to ensure approximately half of our workforce is comprised of new-to-rail industry employees.”
The establishment of the company follows Adani’s struggle to secure an above-rail haulage agreement with an established operator.
In 2019, Adani was snubbed by Genesee & Wyoming Australia, now known as One Rail Australia, and Aurizon had been under pressure from shareholders to not provide above-rail services to Adani. Aurizon said it was not aware of Adani seeking to negotiate above-rail services.
“We are not aware Adani has commenced any commercial process with regard to the tender of above-rail haulage contracts or indeed whether they intend to,” said an Aurizon spokesperson.
Adani will still have to negotiate an access agreement with Aurizon to use the Central Queensland Coal Network, which connects that Carmichael Rail Network to the Abbot Point terminal. Aurizon is legally obliged to consider and assess all access requests however a spokesperson said that all requests are confidential.
“We cannot comment on any discussions that may occur as part of any application made by Adani,” the Aurizon spokesperson said.
To meet the other requirements of operating a rail haulage company, a Bowen Rail Company spokesperson said the company would go it alone.
“Bowen Rail Company will be self-sufficient with respect to rollingstock maintenance and supporting infrastructure. All contract arrangements are commercial in confidence.”
Construction of the Carmichael Rail Network is currently underway, with piling for bridge structures about to begin.
The Queensland Court of Appeal has dismissed an appeal by a group of miners over charges imposed by Aurizon for upgrades of the Wiggins Island Coal Export Terminal at the Port of Gladstone.
The decision is the latest in a court battle that has been running since March 2016, when Aurizon challenged the validity of notices by the miners who sought to reduce how much they would have to pay for the upgrades.
In a statement to the ASX, Aurizon welcomed the court’s decision.
“Today’s decision by the Queensland Court of Appeal means that the customers’ notices are invalid and Wiggins Island Rail Project (WIRP) Fees are payable to Aurizon.”
The company said that no revenue has been accrued for the above regulatory fees since the project was completed in 2015 and the decision does not impact Aurizon’s regulated return for the project.
In a separate Expert Determination process, it was stated that the WIRP fee should be reduced, and Aurizon indicated it is looking at options for appealing that outcome.
Aurizon, which manages the central Queensland coal network in addition to its above rail operations, invested roughly $800 million in the WIRP. However, since completing the WIRP in 2015, coal prices have dropped significantly, leading to the miners seeking to reduce their costs.
With some of the original owners of the Wiggins Island export terminal going into administration, the cost for the remainder to access the port had increased.
Investigations into two freight rail incidents have begun and been completed this week.
The completed investigation targeted the dewiring of over a kilometre of overhead powerlines in 2018. In this case, the ATSB investigation found that the collapsible walls of the flat racks were not secured by personnel at the Acacia Ridge terminal.
When passing through Cooroy on the North Coast line in Queensland, the rear end wall of the top of a stack of flat racks was extended, leading to it becoming entangled with overhead line equipment (OHLE), including copper wire. The wires were dragged along the platform at Cooroy, where luckily no one was present, however a south-bound train was due to arrive in 30 minutes.
Another concern in the incident was train crew entering the three-metre exclusion zone around the OHLE, before the wires were isolated and earthed. Although de-energised, the cables were not electrically safe.
ATSB director transport safety Mike Walker said the incident showed the need for effective processes for emergencies and in freight terminals.
“This occurrence has highlighted the importance of having checklists for rarely conducted tasks and emergency response tasks in the rail environment, and ensuring these checklists are readily available and used by operational personnel,” said Walker.
Aurizon, which operates the Acacia Ridge terminal and the train in the incident, has updated its safety processes in response to the incident and investigation. Network manager Queensland Rail has also mandated a network control officer checklist for OHLE emergencies.
Another investigation has been opened into a freight train derailing near Lake Bathurst. The Pacific National-operated service, a loaded garbage waste train, derailed after a wheel bearing assemble on the trailing axle of the lead bogie of one of the wagons failed.
The derailment lasted for a distance of roughly 2,500m. No one was injured however there was damage to the wagon’s bogie and frame and minor damage to track infrastructure. The NSW Office of Transport Safety Investigations (OTSI) is conducting the investigation on behalf of the ATSB.
Aurizon has increased its earnings before interest and tax (EBIT) by 10 per cent on the previous year’s results and a 12 per cent increase in profit.
This improvement was largely driven by increased earnings from Aurizon’s managing of the Central Queensland Coal Network (CQCN) and strong performance of the company’s bulk business.
These results include the impact of COVID-19 on the business, which managing director and CEO Andrew Harding said had limited impact.
“Despite the emergence of COVID-19 in the second half of FY2020, the Company has delivered a solid operational and financial performance with no material impact as a result of the pandemic,” said Harding.
With much of Aurizon’s business involving the haulage of metallurgical coal, consistent steel production in China and a rebound of steel production in India in May and June helped the freight operator through the COVID-19 period. In addition, a drop in US metallurgical coal exports contributed.
In Aurizon’s coal business, it added new customers including Peabody and Bluescope and added volume in the contract with Coronado.
On the bulk side of the business, Aurizon added contracts with BGC for cement products from Kalgoorlie. Aurizon extended its contracts with South32 Cannington and Incitec Pivot, both on the Mt Isa corridor. Aurizon began the operation and maintenance of a ballast cleaning machine for Rio Tinto in the Pilbara and there was an increase in demand from Mineral Resources. These led to a 21 per cent increase in revenue from bulk operations.
In Aurizon’s management of the CQCN there was a shortfall of volume. Volumes are expected to be lower in the next year due to COVID-19.
Aurizon also reported on its safety record over the 2019-2020 financial year. While there was a 10 per cent improvement in the total recordable injury frequency rate, there was an 8 per cent deterioration in rail process safety performance.
KiwiRail tells Rail Express how its adoption of driver advisory systems (DAS) from TTG Transportation Technology is delivering benefits now and over the long term.
When representatives from TTG Transportation Technology first contacted KiwiRail with their new system, the New Zealand rail operator couldn’t believe what they were hearing.
The Sydney-based manufacturer was introducing their driver advisory system (DAS), Energymiser to KiwiRail and were suggesting that the state-owned enterprise could save 10 per cent of their fuel bill. According to Soren Low, technology and customer innovation leader at KiwiRail, it would take a change of management for the offer to be taken up.
“We struggled at first to get any interest in installing Energymiser, but a couple of years later there was renewed interest and the group general manager at the time said ‘Let’s give it a crack and do a trial and see what happens, if nothing comes out of it that’s great, at least we can say we tried.’”
KiwiRail chose to test the system on a freight line that took wood pulp from the mill at Karioi in the middle of the North Island to the Port of Wellington.
“We did a trial over three or four months and what became really clear is that the numbers that came out of this trial were too good to be true,” said Low.
The initial figures promised by TTG were being delivered and led to the DAS modules being rolled out across the entire network.
“We used the trial to write a business case to justify the investment to roll out Energymiser across the business,” said Low.
A few years later, the onboard systems were in the cabs of KiwiRail’s fleet of 180 locomotives and 350 train drivers were trained how to use the system. Now, across KiwiRail’s 4,500km network the DAS technology delivered by TTG indicate to drivers when to increase speed, when to brake, and when to coast to enable the most efficient runs possible.
The DAS system enables KiwiRail to make the most of a 150-year-old narrow gauge network with many tight corners and steep inclines. Whether hauling bulk freight, logs for export, and dairy during the milking season, Energymiser is enabling KiwiRail to cut fuel costs and significantly reduce emissions.
CHANGE THE WAY YOU DRIVE
While the figures from the trial convinced KiwiRail’s management of the benefits of the DAS technology, there was another group who needed to come on board.
“When we first started talking about DAS to the driver union representatives, there wasn’t much support for it,” said Low. “There was a straight-out view that no technology can tell a driver how to drive a train better than they can. In time, the Rail & Maritime Transport Union representatives came on board, and really helped us sell it to our people. Being able to pull together a small team of committed drivers who believed in what we were doing really helped us test, tweak and deliver the system.”
Until the incorporation of Energymiser, KiwiRail drivers had been trained to travel at the maximum track speed. Now, the DAS onboard screen was telling drivers that they could travel below the track speed and coast on downhill sections and they would arrive at their destination at the scheduled time.
To communicate this change in practice, KiwiRail enlisted the help of a senior driver, Robin Simmons. Having someone with Simmons’s respect within the organisation helped to win over resistant drivers.
“Simmons really quickly bought into this,” said Low. “He really quickly said, ‘You know what, this is actually a really good thing.’ To this day, he is our DAS champion. He has been pretty much working full time on DAS. The training program that we built was very heavily influenced by Simmons and in the early days he did most of the training himself. The fact that he’s a locomotive engineer and train driver was really good in terms of his credibility.”
Another important factor said Low is to ensure that the information that is displayed in cab is not in conflict with conditions on the track. For example, during summer some parts of the KiwiRail network have speed restrictions due to heat. This function was not inbuilt into the Energymiser system initially, so KiwiRail and TTG updated the software.
“The DAS was saying you should be doing 70 km/h whereas the driver knew they should be doing 40 because they were in a heat restriction area and we try and avoid having those mixed messages in the cab,” said Low.
KiwiRail found drivers were in three camps; those that embraced the technology, those who used the DAS because they had to, and those who would prefer not to use the technology. Convincing the second and third camps and encouraging the first to become advocates for the system would take a different approach.
“In our training, we spend a day in the classroom with our drivers and most of it is really hearts and minds stuff. It’s about the bigger sustainability picture, it’s about why this is important, it’s about how organisations like KiwiRail need to cut costs, how we need to invest our money wisely and then a little bit of the training is actually the technical bit of how you use the tool,” said Low.
Acknowledging and incorporating these factors has led to the success of the system.
“The reality is if you can’t get the drivers on board then you are dead in the water.”
ENCOURAGING CLEAN AND EFFICIENT OPERATIONS
Seven years on from the first contract signed between TTG and KiwiRail the system has enabled a 10 per cent reduction in fuel costs. However, even more important than the savings are the benefits that the system has brought to KiwiRail.
KiwiRail has three carbon reduction targets and by the end of June 2020 is aiming to reduce energy consumption by 73.5 GWh. This target was raised from 20 GWh, which was reached only eight months after the agreement between KiwiRail and the Energy Efficiency and Conservation Authority (EECA) in 2016. Fuel savings in locomotives are a major part of this effort and already 17 million litres of fuel have been saved since 2015.
By 2030, KiwiRail must reduce is carbon emissions by 30 per cent below 2005 levels, in line with the Paris Agreement. Finally, as a state-owned enterprise, KiwiRail must achieve net zero carbon emissions, in line with New Zealand’s overall climate goals. Since the 2012 financial year, the company has reduced its carbon intensity of rail freight by 15 per cent.
To meet future goals, DAS has a role not only to ensure the efficient movement of freight but to provide a better service for KiwiRail’s customers, enabling more goods to be moved on rail rather than road. The KiwiRail network is predominantly single track, so making sure trains run to schedule is essential. This is where the connected DAS technology can contribute.
“The connected DAS, where you integrate the onboard systems back to the back end of train control can create a potential opportunity to tie those things together to take it to the next level,” said Low.
This can enable better scheduling to move freight quicker, without using more fuel.
“Our job is to provide excellent customer service outcomes,” said Low. “The first step is to analyse schedules to ask, ‘How do we take our existing journey time and look to cut up the journey into more fuel-efficient increments, what kind of fuel saving can we derive from that?’”
Getting to that point, however, requires buy-in from across the organisation, and this is where DAS’s fundamental benefits are important, concludes Low.
“This is not for us right now, it’s for our grandchildren’s grandchildren. It’s a long-term project, that’s why it’s so vitally important.”
Managing director of TTG Dale Coleman said TTG are extremely proud of its relationship with KiwiRail that embodies what success looks like. TTG and KiwiRail have combined world leading research into to technology that can be successfully implemented into an existing operating environment by a committed Kiwi Rail management and operations team.
Coleman also acknowledged the research excellence of the University of South Australia, which has been instrumental in the delivery of Australian knowhow in building a fully connected and integrated DAS deployed on more than 8,000 devices operating over 60,000 kilometres of track in more than 10 countries worldwide. The system delivers sustainability not only to KiwiRail but also other leading world class railways including SNCF, Arriva, First Group, Abellio, and Aurizon.
An out of service water level sensor led an Aurizon freight train to plough through flood waters that had inundated a rail bridge near Tully, Queensland, in 2018.
The Australian Transport Safety Bureau (ATSB) found that the driver had attempted to stop the train before the flooded bridge, but as the bridge was soon after a curve, applying the emergency brake was not enough to stop the Brisbane-bound train.
Following investigations unearthed that the water level sensor at the bridge had been out of service for several weeks, and the crew was not informed that the bridge was flooded. A CCTV camera also installed had an out-of-service illuminator, so was ineffective at night.
Further inquiries by ATSB established that Queensland Rail (QR), the infrastructure operator, could not effectively ensure that network control staff knew that monitoring systems were working or not, especially during conditions such as wet weather. The ATSB also noted that control staff were not required to actively search for information about track conditions ahead of a train when there was a realistic potential that conditions had deteriorated.
“This investigation highlights the importance of having serviceable weather monitoring stations at known flooding locations on a rail network, and ensuring that if these systems are not functioning all relevant parties need to be aware of the defect,” said ATSB director transport safety Mike Walker.
The incident occurred on March 7, 2018, after a significant period of wet weather, the Tully area is also one of the wettest towns in Australia, with an average March rainfall of 756mm. A flood watch had been issued on the afternoon of March 6 for that area.
Due to these conditions QR had placed a speed restriction on the area, limiting the speed of trains so that they could stop short of an obstruction within half the distance of a clear line that was visible ahead.
“Operating under a condition affecting network (CAN) requires effective communication between all relevant parties,” said Walker. “Train controllers need to ensure that all relevant information associated with the network conditions are passed to train crews and track maintenance personnel so that they can effectively perform their roles.”
The train driver and crew were not injured, and following the incident moved the train to the Tully yard.
QR has improved its processes to ensure weather systems are reliable, and that control personnel are aware of any faults. Network control staff have also been trained to proactively monitor network conditions.
The Australian Competition & Consumer Commission (ACCC) has sought leave to appeal to the High Court Pacific National’s purchase of Aurizon’s Acacia Ridge Terminal.
In May, the Full Federal Court, on appeal, found that the sale would not substantially lessen competition in the rail freight sector.
If the ACCC’s appeal is successful, it will be the first time that the High Court has heard a case with Australia’s merger laws.
Pacific National has criticised the ACCC’s pursual of the case, which had been heard and ruled upon twice at the Federal Court level.
“Pacific National was looking forward to completing the transaction and adding the Acacia Ridge Terminal to its network of efficient freight terminals, and this will once again be delayed while the ACCC seeks to further appeal what Pacific National considered was a comprehensive and correct decision by the Federal Court,” said a Pacific National spokesperson.
Aurizon has said in a statement that it would continue to operate the Acacia Ridge terminal and expected the leave application to be heard and decided before the end of 2020.
The ACCC has been pursuing the case as it sees the case as a test of Australia’s merger laws. In addition, the ACCC is attempting to seek a finding as to whether a court can accept an undertaking after finding a proposed acquisition is anti-competitive.
“We are seeking special leave to appeal to the High Court because it is vital for Australian businesses and consumers that competition laws are effective in protecting the competitive process,” said Simms.
Pacific National had offered to make an access undertaking which the Federal Court had initially accepted. On appeal the Full Federal Court found that the undertaking was not needed.
Simms said that the Full Federal Court’s decision did not recognise the impact of Pacific National’s purchase of the Acacia Ridge terminal.
“We believe that the Full Federal Court’s decision does not recognise the full impact of the proposed acquisition on competition in this vitally important industry.”