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Enabling Canada’s economic growth: opportunities for rail

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RAC asked CPCS to reflect on the future role of freight and passenger rail in enabling Canada’s economic growth. CPCS is a global management consulting firm specializing in transportation strategy, policy, and economics. Based in Ottawa, CPCS is a RAC associate member whose in-house experts explore how rail can better contribute to Canada’s sustainable economic growth.  To receive communications from CPCS, please subscribe here: https://cpcs.ca/newsletter/

The following responses are curated from discussions with CPCS experts in passenger and freight rail.

Where can rail have the biggest impacts on the Canadian economy at this critical juncture?

To help our exporters compete globally, Canada’s rail sector must grow its rail capacity and increase its resilience.

As it stands, our freight railways have among the lowest pricing per tonne-kilometre in the world. Preserving that efficiency while balancing the need to respond to stresses will help ensure businesses can deliver goods to global markets. Railways will also continue allow Canadian businesses and consumers to receive a wide variety of goods at reasonable cost.

Rail can also influence the Canadian economy through its use inn urban areas. Road congestion in cities negatively impacts goods movement, costing an estimated $550-$600 million per year in Toronto alone. Moving more people with rail helps take cars off the road, free up road space, and reduces greenhouse gas emissions (GHGs).

How can municipal, provincial, and federal governments maximize railways’ positive impact on supply chain fluidity and economic growth? 

Passenger and freight rail are capital-intensive, and some of the potential bottlenecks on the network are costly to address. Working with railways to plan, invest, and address other challenges to expanding capacity — supported by appropriate evidence — is critical.

Governments should also look at the growth around rail corridors and terminals, and the limited supply of industrial land, as these factors also affect rail expansion in some markets.

What are the pros and cons of implementing commuter rail (LRTs, trams, etc.) in cities?

Rail is the only viable, sustainable transportation option in busy urban corridors. But once a corridor is established, it is less flexible than other transit modes. The fun part of the work we do at CPCS is figuring out how to design a system that creates value by attracting demand in a cost-effective manner. For example, we’re helping Metrolinx upgrade the GO commuter rail system into a “regional metro” while protecting the important role of rail freight, which shares some key track sections.

What does the future look like for inter-city passenger rail? What effect will this have on local, provincial, and national economies?

Improved inter-city passenger rail can help improve how labour markets function and reduce GHGs by shifting trips off roads and planes. Intercity transport can also help connect rural and Indigenous populations to essential services like medical appointments. We at CPCS apply our skills and experience to find the best solutions, balancing costs and benefits, in a world of uncertainty.

We know rail is already the most fuel-efficient way to transport goods over land. How can freight rail further advance Canada’s emissions and sustainability goals while also contributing to Canada’s economic growth?

Rail is already a tried and tested transport solution that can have a meaningful impact on greenhouse gas emissions through mode shift. What more can be done in the short-term and medium-term to reduce emissions through mode shift? Can shortlines, industrial railways, and transloaders be part of this, given their ability to serve customers flexibly and potential for incubating new technologies? This is an area where railways, other supply chain participants, and government can collaborate to leverage rail’s inherent advantages in addressing climate change sooner.

What else should we be mindful of when thinking of rail and economic growth?

It is increasingly important to consider the impact of investments on diverse groups. Reflecting on the potential distributional impacts for any project sincerely can help identify opportunities to enhance benefits or mitigate impacts.