KiwiRail board backed diesel engines to keep freight customers, Bridges says

KiwiRail's board sided with diesel engines over electric last year for a number of reasons including customer retention in the face of temporary line closures for electricification, Transport Minister Simon Bridges.

Speaking to Parliament's transport and industrial relations select committee, Bridges was asked why the state-owned rail operator chose diesel despite not getting rigorous costings of the options. Bridges told MPs he supported the board's decision, which was based on wide analysis of social, economic and environmental factors, describing it as a "holistic" approach. Those reasons included the disruption to KiwiRail's network and potential loss of customers when electrifying the lines and the fact the diesel engines still have a smaller carbon footprint than freight travelling by road.

"This was a decision for KiwiRail, but I do support it on balance," Bridges said. "It simply makes sense when you look at the economic, social and environmental factors."

Bridges announced the better part of $1 billion of funding for rail infrastructure in this year's budget, including the government's first tranche of its commitment for Auckland's City Rail Link.

The government is also reviewing KiwiRail's operating structure and long-term capital requirements.

Bridges told the committee that the review's terms of reference are currently being determined.

(BusinessDesk)

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