Co-authored by Damien Canning, Kimberley Perry, Samantha Walsham
With transport systems accounting for a quarter of global carbon emissions, according to the International Energy Agency, the transformation to achieve net zero mobility is one of the most significant challenges facing the world today. COP26 has focussed minds across the rail industry and beyond. Clearly there is no time to waste and – as a key player in the future of sustainable mobility – rail has a crucial role to play.
The landscape in which rail operates is changing fast. Access to funding is becoming harder for capital programmes that fail to meet more stringent climate-based regulatory, policy and investment demands. Carbon prices on emissions trading schemes are rising, risking a knock-on effect on the cost of carbon-intensive materials. Investors are pricing climate strategy into the interest rates they charge – which in turn provides strong financial incentives for companies which can demonstrate solid net zero targets.
The scale and speed of the climate transition presents businesses with a number of difficult questions. How do they create the business case for climate action? How do they capture and report value across their operations? How do they implement – and measure the impact – of their strategy? While the questions pile up, the good news is that many of the answers are already known. There are actions every rail organisation can take today, wherever they are on the transition journey. Acting now will not only help to minimise irreversible climate impact – it is also central to long-term business viability.
As the global industry charts its path towards net zero, we believe there are three crucial stages which every rail business will need to navigate:
1. Defining a strategy which begins with the end in mind
For any business, understanding current carbon emissions is an important first step. Measurement means the ability to manage your carbon budget and mitigate its costs. But measurement shouldn’t stop at an organisation’s front door. We need to move beyond compliance and business as usual to effectively decarbonise and drive the industry forward through consistent development and sharing of best practice. Decarbonisation requires nothing short of transformation of all aspects of an organisation and its value chain. This means using a data-driven strategy which takes a holistic – or ‘total-system’ – approach.
For example, working with a state agency responsible for the national road and light rail network in Europe, Arup has developed an implementation plan which will embed the principles of sustainability into all of its decision making, including the need to reduce the carbon impact of construction, operation and use of the transport network through responsible use of resources, re-use and repurposing. This is in addition to helping its customers make more sustainable choices, such as walking or cycling, as part of an integrated mobility strategy.
2. Transforming organisations to deliver net zero
Sustainability is not a single initiative or an isolated programme – it affects every aspect of a company’s operations. You can have the best vision and strategy in the world, but implementation will falter – or fail – if the organisation and supply chain are not set up to deliver it.
Successful decarbonisation requires a business ‘reset’ which puts climate action at the heart of an organisation’s vision and part of everyone’s job. Making climate action and sustainability the starting point across an organisation, rewarding it, and building the skills to deliver it is a major step in mitigating transition risk and securing business viability in the long-term.
Arup has been working with a number of major clients to navigate this major transformation by helping reset corporate vision to help ensure long-term business viability and investment. For example, we are working with rail companies to develop organisational strategy to enable an accelerated transition to net zero. Helping to reconfigure governance and processes to help each employee contribute to reaching net zero is a key part of this journey. Arup is also helping create a culture where employees recognise their shared responsibility for climate action and have the skills to support it.
3. Ensuring real change is industry-wideEnsuring real change is industry-wide
The ‘total system’ approach, including increased collaboration between government and businesses nationally and internationally, is a powerful way of stimulating innovation. It’s also a way to identify opportunities for the whole value chain to incentivise the shift towards decarbonised business operations, driving meaningful progress in areas such as circular approaches across the life of railways. This approach can help to increase asset life and identify whole-life efficiencies, while minimising large-scale waste of precious natural resources.
Organisations such as Network Rail in the UK are ensuring greater impact at scale by using science-based targets. This means they are not only measuring their carbon performance but also setting targets for their entire supply chains. Many rail and transport organisations around the world are also focused on developing sustainable circular procurement strategies as a powerful lever for affecting change throughout the value chain.
Taking a systematic approach to the transformation ahead will help rail companies and industry remain competitive in tomorrow’s mobility landscape. Rethinking the way infrastructure is planned, designed, built, and operated – the reshaping of supply chains, smarter construction, the use of low-carbon materials – all represent opportunities to improve efficiency and reduce costs. Having a transparent, credible transition plan will improve access to credit and the cost of debt. Measuring not just economic value but the social and environmental impacts of those plans as well will help us build a cleaner and more equitable future rail system.
Enticing existing and new customers to choose railways over electric vehicles or aircraft will depend, in part, on offering reliable, affordable, and convenient services which people enjoy using. But rail’s ability to evolve effectively to retain its status as a low carbon mode of transport mode will also be crucial. As vehicle technologies evolve rapidly in other sectors, it is vital that rail keeps pace with the technological advances transforming mobility and that it remains the transport of choice for a new climate-conscious generation of travellers.
This is a critical decade for rail. All businesses are on this journey together, at different stages and facing different challenges. But whichever stage of the transition to net zero businesses find themselves in, meaningful action must start now. Our future depends on it.
*This article first appeared in the International Railway Journal
Accelerating the journey to net zero transport
New business models, new technologies, new policies, new sources of power – the transport industry is changing rapidly. From hydrogen trains to walking plans for tropical cities, from timber stations to city-scale low emission zones, from electric bus fleet conversions to low-carbon airports – Arup is helping to drive decarbonised transport in all its forms.