How to use the available railway capacity in the most effective way? This question is key for the modal shift to rail and is part of many discussions in the area of capacity management. Most agree that so-called Commercial Conditions are a necessary framework condition to incentivise capacity-friendly behaviour and reduce business uncertainties.
What does this mean in non-technical language? A scheduled train that does not run and its capacity is not used by another train, wastes valuable capacity. Furthermore, a scheduled train that is re-routed or cannot run at all, for example due to track works, undermines trust in the reliability and cost predictability of rail transport.
RU members got together and elaborated the RU “Vision on Commercial Conditions”, proposing a balanced commercial condition (CC) system for both Infrastructure Managers (IMs) and Railway Undertakings (RUs). This visionary document, enriched by input from diverse stakeholders, aims for a balanced approach to reciprocal commercial conditions. This means that both Infrastructure Managers and Railway Undertakings face financial incentives to honour the capacity contracts they entered.
Key Components of Commercial Conditions for IMs:
- Motivational Incentive: Encourages IMs to make path changes due to Temporary Capacity Restrictions (TCRs) as early as possible.
- Standardised Compensation: Enhances market predictability by compensating the market for unforeseen IM decisions, using flat rates to minimise bureaucratic hurdles.
- Traction Support: Ensures competitiveness during major infrastructure works by providing IM-offered locomotives for re-routing e.g. via a non-electrified line.
Key Components of Commercial Conditions for RUs:
- Motivational Incentive: Encourages RUs to modify or cancel paths as soon as possible to free capacity for others.
- Multiannual Commitment Charge: Preventing the strategic misuse of long-term capacity bookings.
For a deeper dive into this important topic and the approach of FTE members, visit our dedicated webpage