Germany Launches Decade Long Railway Upgrade Plan


Germany will spend on the modernization of the railway network 62 billion euros for ten years. Together with the investments of the national operator Deutsche Bahn in the amount of 24.2 billion euros, the total contribution to the reconstruction of the infrastructure will amount to 86.2 billion euros.


According to German Transport Minister Andreas Scheuer, the government and state-owned company have agreed on the terms of a new performance and financing agreement (LuFV III) that governs the largest rail renewal program in German history. In the period from 2020 to 2024, an average of 7.9 billion euros of annual investments is planned, from 2025 to 2028 – 9.2 billion euros. 


The maximum amount of 9.6 billion euros has been set aside for 2029. Compared to the current LuFV II agreement, the average level of annual expenses will increase by 54%. 


“The goal is to guarantee the quality of the railway network and reduce the need for repairs, in particular at obsolete facilities. This will also increase transport accessibility and improve the condition of railway bridges, ”said Andreas Scheuer. 

The agreement provides for the modernization of 2 thousand railway bridges. Thanks to her, it is planned to double the number of train drivers and passengers by 2030. In general, the program aims to create a high-performance railway network, which will serve as the basis for active climate protection. 

The preparation of LuFV III should be completed by the end of August for submission to the Bundestag in the fall. The third agreement will be valid for ten years instead of the five-year terms of the two previous ones. An increase in the reference period should provide greater stability for long-term planning and help reduce unit costs. 

The current five-year renewal program for German railways in 2015-2019 worth 28 billion euros became the largest in the history of Deutsche Bahn. For its implementation, 20 billion euros were allocated from the federal budget and dividends paid by the company under a LuFV II financing agreement. 


The operator provided another 8 billion euros from its own resources, investing 1.6 billion euros annually. This program exceeded by 22% the total investment under the previous LuFV I agreement from 2009 to 2013 (with an extension until 2014). Then the volume of annual state financing amounted to 2.5 billion euros (against more than 3.3 billion euros per year under the current agreement). 

The modernization program ending this year provides for the replacement of 17 thousand km of tracks and 8.7 thousand turnouts and crossings totaling 12 billion euros. 4 billion euros were allocated for updating alarm systems and train traffic control, 3 billion euros for maintenance work on 875 bridges, and 1 billion euros for tunnel repairs. 

Peter Westenberger, head of the German association of 60 industrial companies, Network of European Railways (Netzwerk Europaischer Eisenbahnen, NEE), welcomed the agreement on the terms of the new agreement and the doubling of its validity. “This ensures the safety of planning, reduces the cost of each construction site, and this is the right signal, because the economy is threatening to slow down,” he said. 


The unprecedented LuFV III conditions were agreed upon in response to growing concerns about the state of the 33,000- 
kilometer German railway network and large expiring facilities.

According to Alexander Kirshner, Deputy Chairman of the Deutsche Bahn Supervisory Board, it takes at least 10 billion euros a year to eliminate a significant lag in modernization by 2030 and restore working infrastructure to good condition. 

In August 2016, the German government adopted the federal transport infrastructure development plan until 2030 (BVWP 2030). 112.3 billion euros were allocated for railway projects and maintenance of the existing network.
 One of the five key aspects of the BVWP 2030 was the priority of maintenance and repair over modernization and construction – 69% of all funds will be spent on maintaining the existing infrastructure, which is significantly more than the share of the same item in the previous plan, which amounted to 56% of the total funding. 

First published in Gudok.ru. Read full story here-https://www.gudok.ru/newspaper/?ID=1473310

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