As China Leads High Speed Rail, Challenge Is in the Price Tag

|
 |  Includes: AOMFF, BDRXF, GE, IBM, KWHIY, SIEGY
by: John Addison

Clean Edge’s 2010 Clean Energy Trends forecasts growth for high-speed rail and renewables. Clean Edge included high-speed rail [HSR] for the first time in its annual Clean Energy Trends report, which tracks key developments in clean-energy markets. China is leading the surge in HSR according to Clean Edge:

China’s Ministry of Railways spent $88 billion on HSR projects in 2009 – part of an existing $300 billion plan to expand and connect all of the country’s major cities with a projected 10,000 miles of dedicated HSR lines by 2020.

There will be more high-speed rail added in China over the next five years than the rest of the world combined, says Keith Dierkx, director of IBM’s Global Rail Innovation Center in Beijing. Global HSR manufacturers like Kawasaki Heavy Industries, Alstom, GE Transportation, Siemens, and others have formed joint ventures or partnerships in China. A Canadian-Chinese joint venture, Bombardier Sifang, recently won $4 billion from the Chinese government to manufacture up to 80 high-speed trains. These same companies are developing opportunities in other emerging countries like Brazil, Russia and South Korea.

HSR’s main development challenge is its high price tag. The 800-mile Beijing-to-Shanghai line will cost an estimated $32 billion – in the same cost ballpark as the gargantuan Three Gorges Dam hydroelectric project.

Maglev potential projects in Japan, China, and the United States are also discussed in the Clean Energy Trends.

A United States 17,000 mile high-speed rail system is envisioned. With 30 states committed to renewable energy growth, electric HSR will help the nation be less dependent on oil. Clean Fleet Report forecasts that high-speed rail ridership will exceed one billion within three years, from over 600 million today. Clean Fleet Reports about U.S. High-Speed Rail.

Disclosure: No positions