Sydney: A team of researchers from the University of New South Wales (UNSW) have come up with a new approach to making high-speed rail (HSR) cost-effective in Australia that involves factoring in the rise in land value among other “value uplifts”.
The report released by UNSW’s City Futures Research Centre on Wednesday showed that HSR stations along Australia’s east coast, connecting the nation’s three most populous cities Sydney, Melbourne and Brisbane, would generate a potential 140 billion Australian dollars (about US$100 billion) in land value, Xinhua news agency reported.
“There are a lot of opportunities around the HSR for Australia to build stronger connectivity between cities and inject significant wealth and job opportunities into the regions,” said Director of UNSW City Futures Research Centre and lead author on the report Christopher Pettit.
In the past, proposed HSR projects have been ruled out given Australia’s relatively small population — compared to countries like Japan, China and Germany, which have established HSR networks.
A report delivered to the Australian government in 2013 proposed HSR development on the east coast would cost 130 billion Australian dollars (about $93 billion).
Pettit said their proposal shows that this cost could be almost entirely offset by value added in areas such as dwelling value, population growth, creating jobs in regional areas of Australia and providing greater access to cities.
“If you were to capture a substantial proportion of this value uplift, it could pay for a huge amount of the HSR,” he said.
Past proposals have attracted no shortage of criticism. Experts have rebuked the idea as having a benefit-cost ratio that would barely break even, and huge emissions costs from the construction of thousands of kilometers of rail lines.
James Abbott, managing director at Abbott Advisory and reviewer of the UNSW report, told Xinhua: “I think that you need to consider the population we will have in 30 years versus the population we have today.
“Melbourne and Sydney, if you can imagine those two key markets within Australia becoming basically one hub, which an HSR could deliver, (would) fundamentally change the Australian economy,” he said.
Abbott said with the benefits far outweighing the costs, the only thing left was strong political leadership that looked beyond the short term.
“Arguments for HSR are not just environmental. They’re also social and economic. There’s a variety of different reasons why this infrastructure makes sense for Australia.”