DIGITAL RAILWAY THINK TANKROUNDTABLE DISCUSSION 2

Summary DocumentInstitution of Railway Signalling Engineers and WSP

Contents

Foreword 3

Key Topic 1: Aligning industry objectives 5

Key Topic 2: Realising the benefits incrementally 9

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The IRSE Digital Railway Think Tank

The IRSE Digital Railway Think Tank is a group of thought leaders from a number of organisations who come together to discuss key issues facing the implementation of digital railway technologies in the UK. The think tank aims to consolidate opinion to offer some useful perspectives that can be used by decision makers in the rail industry. The group has participants from government, infrastructure and train operators, suppliers and consultants.

Meeting on a quarterly basis, the key issues being analysed by this think tank include:• Aligning industry objectives• Working collaboratively for customer benefit• Creating confidence for the supply chain• Addressing the skills shortage• Realising the benefits incrementally

The think tank is led by IRSE Chief Executive Francis How and is supported by WSP. The group met on 8th March to discuss the top two key topics from the list above. This paper is a summary of the main points of that discussion.

Key topicsAligning industry objectives – The attendees discussed the issues associated with balancing Network Rail’s route-level objective with Train Operating Companies’ objectives and with national strategic goals. The possible approaches were then examined in relation to delivery of the business cases under development by the Digital Railway Programme.

Realising the benefits incrementally – The discussion considered making the railway ‘ETCS ready’, as well as gaining early benefits by staged deployment of digital rail components including C-DAS, the positive impact that early benefits would have on future roll-out, and possible migration to ETCS Level 3.

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Synopsis of the key topics discussed

Key Topic 1: Aligning industry objectivesThe overriding objective for the Digital Railway Programme is to increase capacity, improve connectivity and reliability by applying digital technology. However, the objectives of the main players within the rail industry are not aligned, specific examples of this being:• Network Rail is concerned with reducing operating and

maintenance costs and is not necessarily incentivised or funded to offer more train paths and routes at large capital cost.

• Train Operating Companies (TOCs) are incentivised to provide on-time services to meet current demand and timetables, and may regard the disruption of a large upgrade programme as unwelcome, particularly where it involves taking fleets out of service for fitting with new systems.

• TOCs benefit financially from delays where these are caused by the infrastructure, and may therefore be concerned about the financial risks associated with a programme that makes a significant part of the train control system their responsibility by virtue of it being on the train.

• Passengers would like less crowded trains and a more reliable service but are agnostic about the technology to deliver this, and frustrated when upgrades cause delays with no obvious benefit.

For successful implementation then, we need to understand what success would look like for the passengers, operators, infrastructure owners, suppliers and regulators that comprise the industry.

The IRSE Digital Railway Think Tank view

A successful long term outcome is:• Reduced cost of operating the national railway

through more reliable asset performance and more efficient asset and resource utilisation, leading ultimately to a reduction in the cost of travel and less financial support from government.

• Greater capacity and better service reliability and connectivity, with more flexibility to respond to changing customer demand, leading to improved commercial viability for train operators.

• Provision of more and better information for operators, maintainers and customers to support the management and operation of the railway, especially during times of disruption.

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Taking the long viewCommitment to a clear, national roll-out plan would be the best way forward for some, while others thought that the gradual introduction of digital technology based on clearly identified needs on specific routes will build confidence in implementation of new technology, and encourage longer term success. An ‘early adopter’ approach could mean short-term pain for limited long-term gain, and whether there is enough appetite for that pain depends largely on the party affected and whether it can be offset by the longer-term benefit. Acting as a unified industry rather than as individual ‘profit centres’ could help, and the DfT and ORR have a role to play in regulating and directing this approach.

A long-term commitment to fund the Digital Railway Programme (not overly dependent on the ups and downs of individual Control Periods), and agreement on the overall goals of the programme (whatever form that programme takes) are regarded as vital. Incremental implementation may make the funding requirements more affordable, particularly if it can be demonstrated that quantifiable benefits arise from individual route-based projects. The longer-term commitment is important because most individual route-based projects will inevitably have implications for other routes, or for the fleets that operate over them, and therefore need to be planned in a wider context. Individual projects will also be dependent upon development work, which needs to be undertaken for the network as a whole, particularly in the early stages.

The adoption of new technology to address our capacity issues is long overdue and ours is the only national railway system planning to undertake this type of wide-scale implementation. Indeed, the only other example is Denmark, with its Banedanmark Resignalling, with a paper by UNIFE (an association of Europe’s rail supply companies) claiming 80% reduction in train-related delays and a 25% reduction in maintenance costs over the long term. However, Denmark has a simpler train operator structure - the situation is quite a lot more complex in the UK – and has taken a country-wide view over a long timescale (i.e. more than 10-year planning horizon for implementation and 25 years for operations and maintenance), with a goal of achieving the best economies of scale. Lessons are emerging from the Danish resignalling programme that will be useful in the UK context.

UK GSM-R (the Global System for Mobile Communications – Railway) roll out involved both infrastructure and train-borne design and fitment. Following trials in Scotland, the first full implementation was in 2009, by 2013 the majority of the main routes in the UK were fitted and operational, and by 2016 the only areas not employing GSM-R were in the far north of Scotland. The challenges with GSM-R were similar but of a much more limited nature than implementing European Train Control System (ETCS). Nevertheless, lessons can be learned from the GSM-R cross-industry implementation. The seven-year programme was ultimately successful, however one major point to bear in mind is the eventual obsolescence of GSM-R, and the impact that that will have on the ERTMS programme. It is perhaps a useful reminder as to the speed with which technologies advance as we contemplate embarking on another major technological upgrade to the railway system.

Digital Railway Think TankAligning industry objectives

The IRSE Digital Railway Think Tank view

• An appropriate planning horizon is ~15 years (covering multiple Control Periods) for this type of incremental technology transformation. This is the timeframe to be expected for delivering a major DR enhancement project and achieving a reasonable return on investment.

• For the benefit of end users of the railway as well as the industry, UK Government should make commitments to support projects over timescales that are commensurate with ~15-year planning horizons, so that operators and suppliers can plan confidently for implementation.

• Given contracts with the right scope and timeframe suppliers will, we think, make the necessary long-term investment in people, in technology support and development, and could address issues such as obsolescence and technology refresh.

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Commercial pull for the ProgrammeThe GB rail industry operates on a partially privatised model, and we believe that whilst all players in the industry may agree about the objectives of the Digital Railway Programme in principle, their commitment to the Programme in practice may be undermined (understandably) for the sorts of reasons articulated above. In the current model, TOCs are understandably risk averse and focussed on short-term goals predicated by their main metric of success: Public Performance Measure (PPM).

A key challenge, therefore, is how to address this problem. One idea we discussed would be to place passenger TOCs in a position where they are much more incentivised to increase their ridership and become more profitable as a consequence, rather than being focussed on delivering a franchise-specified timetable. Operating in this more business-growth focussed manner could place them much more in a position where they require Network Rail to deliver capacity improvements, including those offered by digital train control technology. This would create ‘pull’ for the programme, which contrasts with the sense at present that this is a Network Rail ‘push’ programme, which train operators view with varying degrees of scepticism. Clearly, the DfT and ORR have a key role to play in bringing about this sort of change. Whether the main objective is to deliver additional capacity, or improve connectivity, or resilience to failures and other causes of delay, or a trade-off of these, we think that TOCs need to be re-positioned as the industry players that are demanding outcomes to meet their plans for growth and improved commercial performance.

Digital Railway Think TankAligning industry objectives

The IRSE Digital Railway Think Tank view

• The industry, including, most importantly, the DfT, should consider adjusting the franchise model to create much stronger commercial incentives for train operators to meet the challenge of the need for more capacity, and to enable them to benefit in profit terms consequentially. Opportunities should be sought for doing this when franchises are re-let – ideally at the same time as digital railway programme enhancements are being contemplated on the routes covered by each franchise.

• We recognise that, in proposing this, the freight operators operate in a different commercial framework, not governed by franchises. More consideration will need to be given as to how to ensure that they too are genuinely providing ‘pull’ for the Programme.

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Collaboration at route levelIf we can align interests and objectives of the players by the means described above, the next crucial step is to secure meaningful collaboration between the players (TOCs, FOCs, Network Rail, ROSCOs and suppliers). While there are cases of Network Rail Routes working collaboratively with programmes (Thameslink KO2 is a notable example), to implement digital enhancements successfully it is clear that one size does not fit all.

Balancing cost reduction, capacity enhancements, additional paths and reliability will require a different approach for each train operator and route, and an appropriate scalable delivery model needs to be developed. It is therefore critical that the TOCs, FOCs, Network Rail Route and the suppliers work together to achieve a common outcome.

Suppliers are ready to step upThe major digital technology suppliers generally seem keen to adopt a different approach to contracting. The primary emerging view is that Network Rail should set the desired output objectives in contracts for projects (for example system capability and availability), rather than being prescriptive about the technology and architecture to be used. There are also indications that suppliers are willing to contemplate long-term tie-in to support the systems, including payment-by-system performance. An often sited example is the move of the aviation industry to availability-based contracts for aircraft, which has proved to be a transformational move in that sector. Could Digital Railway ignite a similar transformation in rail?

This would represent a major change from current and historical practices, and it also brings the major benefit that suppliers will be learning from their long-term involvement in the system, enabling knowledge to be fed back into their future system development work. This closed loop of learning is something that has been lamentably lacking from GB rail infrastructure asset management for many years. This change of approach with suppliers, to involve them much more in the whole system life-cycle, could also lead to faster technological progression, and more flexibility to modify systems as ridership and demand change. Performance type contracts on Banedanmark have proved to be successful in focusing the development programme on delivering tangible and measurable benefits.

Digital Railway Think TankAligning industry objectives

The IRSE Digital Railway Think Tank view

• Greater devolution to Network Rail routes and closer working relationships with TOCs / FOCs is essential for aligning objectives at project level. At the same time, the recommendations made earlier in this paper will place the train operators as the clear “customers” of Network Rail and its suppliers for delivering the infrastructure enhancements, including the digital elements.

• Integration of conventional signalling renewals and enhancements with Digital Railway technology implementations and with other infrastructure upgrades, to form cohesive programmes of work that are tailored to the specific requirements of routes, is essential to the efficient and effective delivery of the desired outcomes. Digital Railway enhancements should not be planned and implemented separately from other enhancements.

The IRSE Digital Railway Think Tank view

• A move to long-term output and performance-based contracts for the delivery and maintenance of systems is a transformational opportunity for GB Rail that must be given serious consideration. It has the potential to bring significant benefits for train operators, Network Rail and the suppliers, and ultimately for the railway’s customers. At best, this approach could deliver better performance at lower whole-life cost.

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Providing visible benefits to the railway’s end usersThe travelling public and freight transporters are the ultimate end customers of the Digital Railway. There need to be clear benefits to them to justify sustained government spend. So, what are these benefits? More frequent services (i.e. greater capacity) and better dependability of services (enabled by increased reliability and resilience) would be great places to start. But that does not necessarily mean that we must have a detailed national programme covering the whole country. That approach has been tried many times over the past 15 years, and has always been found wanting or overtaken by events.

Realistically, well-targeted improvements on specific routes will be much better received by our customers, rather than proclaiming a national plan for the next 25+ years - and it can provide good PR for the railways, if only as an example of what the industry is capable of doing.

Encouraging actionCurrently, Network Rail route-level business cases are being considered to identify how digital technology coupled with conventional upgrades can provide compelling customer benefits. This is to be applauded, as is the matrix approach being proposed by Network Rail for decision-making regarding the choice of digital technology. The ‘migration matrix’ defines a number of migration states, each state being a combination of digital technologies at varying levels of available functionality, from which an application project can select the most appropriate state to implement. As we have said, this needs to be combined with an approach that places (and incentivises) the train operator to provide the ‘pull’ to make things happen.

Business cases provide a decision tool to assess where the potential lies for the best benefits. They are not a substitute for action. To actually deliver the benefits in a demonstrable way requires a commitment to the implementation process, with acknowledgment and acceptance of the costs and benefits (and possibly, in some cases, short-term dis-benefits) for the players.

Feasibility studies giving details on how these plans will be implemented could put more weight behind a business case. However, we are concerned that studies such as this would send the wrong messages to the wider industry, namely that decisions are still not being made, and that delivery is still uncertain and some way off. The Digital Railway has been a long time coming and further debate would be seen as dithering by parts of the industry keen to see progress.

Incremental progress and the long termThe ‘Connected’ Driver Advisory System (C-DAS) is already working well on South West Trains and delivering substantial savings in fuel costs (around 15%). We note that success has come when a close working relationship between the Infrastructure Manager and the Train Operator has been established. It is also a good example of what can be achieved where a train operator is taking both the lead and the initiative, and is supported by Network Rail.

In the case of C-DAS the Train Operator could see the benefits that led to implementation before even a national C-DAS specification had been developed. There is always the temptation with any new technology that everything must be thought through and all the specifications made final and watertight before any attempt at implementation begins.

Digital Railway Think TankKey Topic 2: Realising the benefits incrementally

The IRSE Digital Railway Think Tank view

• The industry needs a ‘quick win’ – one successfully delivered project of sufficient significance from which the industry (including suppliers) will start to believe that we are serious about the programme and that we can deliver successfully.

• This group therefore encourages rapid decision making on the routes where there is a good case for some form of digital solution in conjunction with other conventional upgrades. Available investment should be prioritised now, and suppliers engaged in a manner that gives them confidence that this time contracts really will be let.

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It is this (and the constant planning and re-planning) that has bedeviled the European Railway Traffic Management System (ERTMS) Programme for the past 15 years. Making a start, with incremental progress and learning as we go, is a far more pragmatic way to make progress – one in which the benefits are realised earlier.

There is concern that modest improvements, such as the introduction of C-DAS over a limited geographical area, could render the adoption of ETCS less attractive and therefore hinder its uptake. However, the need for short-term incremental benefits must be seen as part of a longer-term plan. That plan must include ETCS because, fundamentally, ETCS is the principal signalling system being offered by the major suppliers. The notion that we can continue to operate the railway with lineside signals for the next 50+ years is untenable, nor is it necessarily less expensive than using ETCS.

Moreover, once ETCS has been implemented on a route (with no lineside signals), further configuration changes to deliver enhanced benefits become easier to implement with minimal infrastructure change, due to the fact that the majority of changes will be in software rather than requiring changes to physical assets. Changing software is not trivial, but it is easier than conventional re-signalling, which involves lineside signals.

Digital Railway Think TankRealising the benefits incrementally

The IRSE Digital Railway Think Tank view

• Although an overall strategic plan for the Digital Railway Programme is important, we support the idea of a step-wise approach, prioritising the delivery of digital technology for train control and traffic management on those routes where the needs and benefits are demonstrably the greatest.

• A culture of transformation in the railway needs to be established by acknowledging and celebrating each digital railway project as it delivers demonstrable benefit. This will help to create “can do” confidence in the industry, eventually resulting in digital transformation becoming the ‘day job’.

The IRSE Digital Railway Think Tank welcomes comments and observations on the points in this summary document. Please address any comments to steve.denniss@wsp.com.

The next Digital Railway Roundtable discussion is planned for 15 June 2017 at WSP House, 70 Chancery Lane, London, WC2A 1AF.

If you would like to be involved or require further information please let Samantha Avis know at samantha.avis@wsp.com.

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