It is not always easy to make a major investment in a project, when it is known that it will only show returns in the distant long term. This is made even more of a wrench when you know that you might not be around to see a project pay back.
The limited length of a rail franchise means that operators are sometimes wary of making investments in station infrastructure, such as in the lighting, if it is known that a project won’t pay back before the end of a franchise. Are the length of rail franchises in the UK holding back the development of innovative lighting on the nation's rail network?
Ben Martin is the head of asset management at c2c, which has recently been taken-over by Trenitalia, the Italian state railway operator.
The train operating company manages 25 stations including Tilbury and Southend and some of the busiest stations on the firm’s network include Fenchurch Street, West Ham and Barking and Upminster in London.
The company has a 15-year franchise on the route, which is quite unusual and only occurred because c2c was one of the first firms to accept a franchise. Most franchises issued today by the Department of Transport run for between seven and ten years.
‘Our 15-year franchise gives us the ability to carry out some projects that other operators will struggle with,' Martin commented during Lux’s recent Lighting for Rail Conference in Central London.
‘We can take a longer term view when it comes to looking at whole-life costings and lighting represents a major opportunity for us when it comes to energy saving.’
Lighting represents between 40 and 80 per cent of energy consumption at any given station on the c2c network.
‘This is a meaningful chunk of energy that we need to be in control of and most importantly, manage downwards,’ Martin commented.
‘We realised that we needed to unlock the hidden benefits of our stations and the length of our franchise would give the time to be able to do this.’
The company has also engaged with utilities providers in order to find how how they can go about getting the best energy prices available in the market place.
‘I have 26 stations and from an asset management point of view they are consuming money, whilst delivering a service to passengers. What I need to do is to work with third parties, to try and unlock the hidden benefits of these stations.’
Franchise agreements do not always act as a limitation on progress, some agreements ensure that there is change by enshrining energy reduction targets into the small print. Most importantly there are often financial penalties associated with not reaching the necessary targets.
'We realised that we needed to unlock the hidden benefits of our stations and the length of our franchise would give the time to be able to do this.’
‘We have a requirement in our franchise contract that we reduce energy consumption by 25 per cent, with a stretch target of 38 percent,’ Martin says.
Lighting quality is also important to c2c, which is not often of the highest quality at stations around the UK.
‘On a wet rainy day, standing on a platform is probably one of the worst places that you can be,’ Martin adds.
‘We consider the total project costs including the design, the products, the warranties, the extended warranties, the commissioning, the insulation, all of these things come together to create a successful and high quality project.
If you get any one of these things wrong, such as commissioning, you can have the best product, with the best control system, but if you don’t commission the project properly then you may as well pack up and go home,' Martin concludes.