Office of Rail and Road ORR issues HS1 final determination (9068Y)
January 07 2020 - 1:00AM
UK Regulatory
TIDM17NR
RNS Number : 9068Y
Office of Rail and Road
07 January 2020
ORR sets GBP25.9 million charges per year to keep High Speed 1
in good condition
The Office of Rail and Road (ORR) has today decided that train
operators using the High Speed 1 rail line from London to the
Channel Tunnel will collectively pay GBP25.9 million per year
towards the long-term cost of keeping assets in good condition.
The 67-mile high speed track, originally opened in 2003, is
owned by Government and operated by HS1 Ltd.
The charges are increasing compared to their current level
because costs in the future will be higher than now, as the line
and its assets are getting older and need more work, but the amount
is 32% (GBP12.3m) per year less than HS1 Ltd requested. The charges
spread out costs for necessary work over 40 years helping to
prevent price spikes in future years.
ORR's analysis has shown that the lower figure is sufficient to
ensure the assets are sustained. The reduction compared to HS1
Ltd's proposals will benefit operators and hence passengers and
freight users.
The Final Determination, as it is called, will come into effect
from 1 April 2020.
While we have approved the majority of HS1 Ltd's proposals we
have also determined some aspects of how the asset should be
managed; these include reviewing the approach to asset life and
project management costs. Given the increase in funding HS1 Ltd
will receive and the expected ramp-up in work to renew the railway,
we will be reviewing and heightening our monitoring and reporting
of HS1 Ltd's progress to ensure that the plan is delivered well and
at good value.
John Larkinson, ORR Chief Executive, said:
"High Speed 1 is a valuable public asset and our role is to
provide independent assurance that the line will be kept in good
condition over the long-term at the lowest possible cost. This is
important to make sure that train operators and, in turn,
passengers and freight users get a good deal now but not at the
expense of future generations."
Notes to editors
1. PR19 Final Determination.
2. High Speed 1 Ltd holds a Concession Agreement for 30 years
for operation of the HS1 network, until 31 December 2040.
3. ORR carries out a periodic review, every five years, of HS1
Ltd's funding for the following control period including
consideration of its plans for the next 40 years, to establish
whether those plans are consistent with its General Duty.
4. Total charges of around GBP119m per year also include the
costs of operating and maintaining the network and GBP25.9 million
of this will be collected annually from train operators to
specifically fund replacement and renewal of the line as
needed.
5. The Office of Rail and Road provides independent assurance
and oversight of the UK's railway and is also the monitor of
England's strategic roads. Follow us @railandroad.
Enquiries should be directed to Lisa O'Brien: 0207 282 2188.
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END
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