Interesting to see yesterday the government make a decision on the Clifford Bay ferry terminal. I say interesting because the more you look at the details the more it shows just how much transport policy is being driven by political agendas rather than based on facts. First up here is Gerry Brownlee’s press release
The outcome of a study into the commercial viability of a ferry terminal at Clifford Bay in Marlborough has concluded Picton should remain as the southern terminal for the inter-island ferries, Transport Minister Gerry Brownlee announced today.
Over the past year a Ministry of Transport-led expert team has been testing whether Clifford Bay could be delivered as a fully privately funded project.
“We have been delivered a thorough and robust report which clearly shows Clifford Bay is not commercially viable as a fully privately funded project, and the level of investment required at Picton over the next decade to extend its life would be substantially less than previously estimated,” Mr Brownlee says.
The project team estimated a ferry terminal at Clifford Bay could be delivered by 2022, at a cost of $525 million. This left a gap the Government would have been required to fill to induce private sector investment in the construction and operation of the terminal.
Meanwhile, the investigation found Picton’s facilities are not expected to fail or become constrained due to asset age or condition, or growth in freight volumes, over the next 30 years. It also found the level of investment required at Picton by its owner Port Marlborough over the next decade to extend its life and adapt its facilities is approximately half the cost estimated in 2012.
Mr Brownlee says it was concluded a number of significant financial risks would exist in the development and early operating phase of a ferry terminal at Clifford Bay.
“While it was expected these would be manageable, mitigation and management cost would have fallen to the Government.
“In the end, the government cost, remaining risks, and the lack of a compelling constraint at Picton have led us to decide the Clifford Bay option should be set aside at this time,” Mr Brownlee says.
“I hope this announcement will provide some planning certainty for Marlborough communities.”
To read the report, Clifford Bay Investigation 2013, and the paper Mr Brownlee took to Cabinet, visit www.transport.govt.nz
For those that aren’t familiar with the proposal, the idea is to create a new ferry terminal further south of Picton as shown in this image from the Ministry report.
It would be a substantial project though with the report stating there would need to be
- the construction of a breakwater 1.8km into Clifford Bay with a single-pier dual-berth facility for the two ferry operators
- associated shore-side facilities for the marshalling of passengers, vehicles and rail wagons
- the upgrade to Marfells Beach Rd to SH1
- a rail link to the main trunk line
None of that is going to come cheap and the report costs the terminal at $525 million – although positively Kiwirail already own most of the land needed so land acquisition wouldn’t be as high. The problem comes that the berthing fees for ferry companies simply wouldn’t be able to cover the costs of building the terminal and so the project isn’t viable from a commercial perspective. But what about the economic benefits of the project?
There are a couple of massive benefits for the project first of all it’s a shorter route (~15km) as well as one that also has no speed restrictions on it which means faster journey times. In addition as most people and freight are travelling south it would also provide some substantial travel time savings for both roads and rail due to being further south and not having to deal with the climb out of Picton and the Dashwood Pass north of Clifford Bay. For rail that journey incurs not just a time penalty but an additional operational one too as either an extra locomotive is needed or trains need to be shorter. The time savings are listed below. Compare those savings with something like Puhoi to Wellsford which would save 10 minutes if we’re lucky.
So while the costs are high at $525 million, the overall economic benefits are substantial enough to outweigh them with the report stating that the project has a Benefit Cost Ratio of 1.3. Unfortunately we can’t see all of the details relating to the benefits as most of that has been blacked out. However interestingly the report does state that the BCR of 1.3 doesn’t include the wider economic benefits (WEBs) that might occur (which have been assessed) and also uses an 8% discount rate and 30 year evaluation period.
This in itself is interesting as the NZTA recently changed their economic evaluation manual to assess projects with a 6% discount rate and 40 year evaluation period. The report states that an assessment with a 6% discount rate was done but the result is blacked out. I think it’s pretty safe to say the result would have been much higher if all of those bits were included. Why this is particularly interesting is that the government/NZTA have long been talking about the BCRs of the RoNS projects like Transmissions Gully using the new assessment criteria as well as included the WEBs figures too.
The project even scores highly on the NZTAs new assessment criteria which asks about Strategic/Policy Fit as the crossing is considered a key part in both the national road and rail networks.
Now let me be clear, I have no problem with the government saying they that they won’t support the project – despite being economically viable – due to it not being commercially viable. Sure there might be a positive benefit to the economy but if we can’t afford to build the project then that is fine. But I do have a problem when the same approach isn’t being taken when it comes to other areas of transport policy like what is happening with the RoNS. Projects like the Kapati Expressway have a BCR of 0.2 and Transmission Gully isn’t much better yet the government are pushing them ahead as fast as possible.
What all of this means is that the government are clearly picking and choosing which types of projects they want to support regardless of the facts. There would be no issue with this if they just said we’re building roads because we like them better but they don’t, instead they pretend they are building stuff that will really help the economy.
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Being a frequent traveller between Tiamru and Wellington, I think I’d rather see a Christchurch-Wellington overnight ferry operate once again, though I know that the chances of that happening is remote. 🙁
Yeah, that would be great. And we already have Lyttelton so need to spend a lot on facilities.
Is there some reason that option wasnt considered? Surely most freight and passengers crossing the Strait are headed to Chch?
If you’re a passenger on the ferry then surely part of the trip is about the view? If speed is of the essence, you’d fly. Surely? Freight wise, some upgrading of the line from Picton doesn’t see unreasonable. Likewise for the road.
Presumably, to create the same “throughput” of cars & rail cars, you would need, what is the distance covered – 5 times x times that to Picton? So simple logic means you need 5 times the ferries, including all those ops costs that go with it. Not sure what each ferry costs, but not going to be cheap. And of course, a ferry isn’t as fast as a train/car on land either, so would likely add time, rather than subtract.
There is still a Lyttelton-Wellington freight service and has been for many years. In the days when it also carried passengers, it only took a couple of hours longer than what it takes to drive and take the Picton ferry. Those ferries did the run at 40 km/h continuous speed, whereas the highway has a lot of hills to slow things down, and through the Hundalees it is very twisty with lots of sharp curves.
The Lyttelton-Wellington freight service was withdrawn quite a few years ago, having been halved in frequency (nightly to every other night) some years before that – see http://www.transport.govt.nz/assets/Uploads/Sea/Documents/Clifford-Bay-Investigation-Report-redacted.pdf p39. Apart from the demand issues mentioned on that page, having a ship idle during the day every day is very poor use of assets, and the “couple of hours longer” meant that a daytime service, even if sailing and turnround times had allowed it, was never going to be competitive with operating via Picton.
The trip port to port was about 11 hours off the top of my head. They could have operated one ship perhaps 10 sailings a week (5 in each direction) depending on demand which would have been reasonably efficient, ideally a 2 ship service would allow 20 sailings a week if the demand existed. It was simply by choice they had the ship sitting in port for half a day at the time. It was also a freight service that often took livestock that Railways would not allow on their ferries.
Sorry not true, Pacifica has been carrying freight between the ports for a number of years and still does today. This is not the same as the Union company’s passenger ferry service withdrawn in 1976.
$525 million, this is the reason? Seems like money well spent to me if you look at the savings in transit times. This is peanuts compared to what would be dropped on a RONs at the blink of an eye. It’s proably because there is a huge time saving for Rail and not road, if it was the other way around it would have been approved! Hows that for pesimistic or is it?
There were some interesting background in the article in yesterdays Herald on the matter.
1. The government wasn’t going to pay for all of it (it wanted a PPP probably but didn’t say so directly but implied it clearly enough).
2. The Freight lobby said “we ain’t paying extra for it” (even of most of the benefits accrue to them).
3. The supposed costs of “upgrading” Picton were massively over stated and were in fact only actually 50% of the supposed cast in stone costs given by some consultancy company in 2012, so Picton is actually the cheaper option.
And lastly (and probably more importantly than all the other facts).
The recent Seddon ‘quakes have reminded the Gov’t and the private freight companies and their PPP financiers that this part of NZ is right over a major set of fault lines and there is a very good chance of a future seismic event occurring in the next 40 or so years, which would damage or even destroy the terminal at Clifford bay.
Its bad luck for the Inter-Island ferry to lose one of its propellers and be out of action for 6 months, its bad planning to have the Wellington inter-island terminal built over an active fault line which is certain to go in the next 30-40 years.
But its down right careless if you put all your inter-island freight through a seismically active area at both ends of the crossing.
So that you could lose the link for years or even permanently any time in the future, and at the very time you’ll need it most.
No PPP will go anywhere near Clifford bay for that reason and that is why its not going ahead.
There is a significant tonnage restriction on trains just south of Clifford Bay at the Ure River cutting and tunnel. KiwiRail often split their trains at Wharanui just south of there because of this.
A dig out of this cutting and daylighting the tunnel would allow Kiwirail to run trains all the way from Christchurch to Clifford Bay without a train weight restriction being imposed on literally the last mile.
I see no mention of this in any of the discussions about the Clifford Bay ferry terminal.
Because this constraint applies equally to rail from Picton and Clifford Bay,
Any upgrade would equally help trains travelling north of there i.e Picton (assuming their are no further tonnage restrictions on the haul up to Picton)- so its not really a factor in deciding which port is better.
There are three geographical features between Wharanui and Picton which act as a barrier to large trains. The Ure River Cutting, Dashwood Pass and Elevation Saddle.
A Clifford Bay terminal would shortcut the Dashwood and Elevation obstacles. Dashwood and Elevation are major mountain obstacles whereas Ure could be characterized as a low ridge. Deepening the cut at Ure River would not be a difficult job and would co-incidentally provide a source fill for any reclamation required at Clifford Bay.
Matt you have hit the nail on the head with this post. Key/Joyce/Brownlie like roads and are not interested in rail or ferries. This is pretty much the basis of NZ’s current transport strategy. Economic analysis be damned!
Well spoken Matt L. I too don’t have a strong view either way on Clifford Bay. I do have deep concerns that this project was appraised using a completely different sort of yardstick than the RoNS…..and for that matter the Auckland East-West link. I can understand why Cantabrians in particular might be pretty annoyed at the outcome of the Clifford Bay study.
It would be an interesting exercise to summarise a comparison of costs and benefits between Clifford Bay and the East-West link.
The risk of earthquakes is a good reason to spread transport options including access to coastal shipping both stand-alone, and as provided by the many overseas ships visiting our coastline. Note however that Wellington itself is built on top of a faultline and many examples in Japan demonstrate how it is possible to build extremely resilient structures. I don’t think that the risk of earthquakes is a good enough reason to discard Clifford Bay.
Off topic on this blogsite, another interesting comparison would be the tax incentives given to the oil exploration industry compared to the film industry.
If motorways lead to prosperity, Portugal should be booming. Instead the massive new motorways are close to empty, traffic volumes have fallen substantially and people comment that more investment should have been in rail and education. In 10 years time will the international financial press be making similar videos to this about New Zealand ?
http://www.ft.com/cms/s/0/03486cb0-3587-11e3-b539-00144feab7de.html#axzz2kiNG8H2Z
The link above is incorrect. Use this one
Oh those crazy radicals at the Financial Times, eh? No mention of all the other disbenefits of this over investment; the severance of local communities in particular.
Here the government through NZTA is like the EU/IMF who force, top down, investment in their pet mode, regardless of the wishes of the people and refusing to check their lazy and dated assumptions against newer facts and better analysis.
And they are piling debt on the nation to do it. Directly through those sham PPPs, and indirectly and compounding though a doubling down on auto-dependency and the ruinous costs in imported products that that commits us to…. so it goes; small boys in suits.
NZTA or MOT?
Yeah the Clifford Bay Ferry terminal would have much higher economic benefits that having the Ferry Terminal at Picton because the Ferries won’t have to slow down when they go through the Marlborough Sounds and also the ferry terminal will be located a lot closer to Christchurch which will save a significant amount of travel time.
Surely the site would be pretty windswept no matter how big a breakwater you built? How many extra sailings would you lose each year from ferries unable to dock in rough weather? At least Picton is sheltered by hills to the east and west.
Also, what is the recovery option if a terminal at either end is totaled in an earthquake? Wellington has the Bluebridge which docks in town, but that isn’t too far from the other terminal. For a bit of vital infrastructure, there isn’t a lot of redundancy and I’m not sure how you’d provide it.
If a terminal is ‘totaled in an earthquake’, then its a fair bet that the terminal at the other end would also be pretty munted, as would any terminal in Picton. Given the potential alignment issues with an earthquake damaged RO-RO berth and link-span, a terminal breakwater would likely be the lesser concern.
If resilience is required, then it will most likely be through coastal shipping style vessels with their own on-deck cranes if the shore infrastructure is out of action. This would apply at any of the three locations – Wellington, Picton and Clifford Bay. I should also add that such a vessel is a vastly more resilient option in a major Wellington earthquake than Transmission Gully.
The whole point of a breakwater is that it no longer matters how windy it is. For example New Plymouth is windy with enormous waves all summer and still operate a full scale commercial port. The only issue will be with swell at the entrance to the breakwater, but I guarantee it will be no worse than the Tory Channel which has massive swell and particularly bad backwash off of the surrounding cliffs.
obi I took the sea ferry Norrona from the pretty windswept North-west coast (Hirtshals) of Denmark to the Faroes and Iceland this year and as the terminal was well insulated (probably triple glazing etc) and nice and warm inside. Now that was the European North Sea summer, don’t know about the winter but I guess if you don’t stay outside too long it’s no problem! But anyway, despite the windswept and isolated nature of the location there were several sea ferries coming and going from there and it seemed pretty popular so I can’t why Clifford Bay couldn’t work either as infact it would be significantly closer to a major urban area than Hirtshals. And you’d be surprised just how rough big sea ferries can dock in. Even though it was Summer in Hirtshals, the day I sailed there was a fair wind and it was looking pretty rough heading out past the breakwater but the ships were handling it pretty easily. Wish now I’d taken some video of them coming and going. Having said all that, Picton is one of my favourite places in NZ!
I look at this http://www.youtube.com/watch?v=RPjWMDAYWZs and wonder how you’d ever dock a ferry in a storm unless the terminal was really sheltered.
A thought regarding redundancy in a major disaster… Why not invest in some of the hovercraft assault craft the US Navy has? Urgent freight, like engineering equipment needed for disaster relief, would rocket across the Strait at really high speed and you could land it anywhere with a beach at either end.
Yes obi that is a great clip and not uncommon sea conditions for Cook Strait. Clifford Bay is fortunately sheltered from the direct southerley swells which are the big seas on the ‘Strait. Wellington harbour entrance on the other hand……..
Modern weather forecasting should ensure that a “Wahine situation” of a ship broaching uncontrollably at Wellington harbour entrance due to unexpected and massive following seas can never happen again. But, it is a situation where vigilance is essential given that conditions can change so quickly.
Hovercraft assault craft maybe, though not sure about finding suitable beaches. Petone foreshore? I can only presume that such craft though an engineering success, are not commercially competitive or else there would be more in service (other than in a military role).
There are various large commercial high speed catamarans available and they are in operation around the world. One design can even cart rail wagons. Clifford Bay of course opens up the possibility of high speed catamarans again which I believe could induce passenger demand to an extent not considered by the report. Won’t comment on the carbon footprint of such a beast but it could be quite a waterski!
Some background, which I hope is useful. Clifford Bay is one of those hardy perennials which has been on some sort of drawing-board since at least the 1970s, the justification being that it would reduce the time taken by rail freight between the North Island and Christchurch and thus allow it to secure if not retrieve market share from trucking.
When I worked for Inter-island Line as its truck freight analyst, we had a meeting on the Clifford Bay option, and my notes at the time were as follows:
It takes eighteen hours point-to-point to get a truck from Auckland to Christchurch. It takes up to twenty-four hours to do the same thing railhead-to-railhead, and up to twenty-seven hours once point-to-point time is included. The times by sea are about 48 hours port-to-port and 52 hours point-to-point; but Pacifica can and does do it at a lot less cost and they avoid a lot of double-handling. Now, while Clifford Bay will cut the rail times by two hours, it will also cut the road time by an hour or so as well, meaning that trucks will still have a massive advantage in anything that’s time-sensitive (the cost of inventory is a major reason why shippers want things faster).
The cost of Clifford Bay was then estimated at around a hundred million dollars or so. Using strictly commercial criteria we didn’t proceed with the idea, essentially because by this stage (May 2000) we (Tranz Rail) were beginning to seriously run out of money. One option which the Michael Beard management team did look at was abandoning the line completely, and using shipping instead to connect Wellington and Lyttleton, which is what Pacifica were doing fairly successfully, at least at the time. We also recognised that if we were going to recover the market from trucks, an awful lot of money would need to be spent on the rail infrastructure as well.
Another factor of some interest, is that abandoing Picton as a ferry port would have some environmental benefits for the Sounds as well; was this acknowledged?
I have to say that removing the terminal from Picton is probably the biggest benefit to this entire project. The ferry destroys the sounds.
COMMENT DELETED FOR VIOLATING BLOG RULES.
The blog moderators, and most of us on here are against the Avondale Southdown link, we are against the zigzag CRL route, against the elevated downtown rail. It is pretty hard to be against any cycle proposals when there is so little infrastructure at the moment that the only things being proposed are the absolutely critical network components rather than the icing on the roading cake that is coming through now. When will you learn that wanting to have all modes available isn’t anti-car any more than wanting black people to be allowed to vote is anti-white.
Yes, we still do need motorways and roads, but they wil still be there, we just think that it would be a good idea to have options to move other than owning a car and driving it everywhere.
With your ridiculous ‘experiment’, how about you ask the junior if he would have rather paid 4 quid for the train or 400 for the limo, and how about you think about the reality of getting to Twickenham with 82,000 other people all in cars?
I don’t want to speak for the authors. But given that cycling infrastructure frequently has BCRs of 5-20, and current road infrastructure BCRs of 0-1 (ie negative), no.
Of course Auckland needs roads. But does Auckland need new roads? Especially does Auckland need extremely expensive and invasive massive new roads? Are there other things that Auckland could do that is a better use of that money and that land?
Even a mildly observant person can see that Auckland has a huge road resource massively expanded over the last 60 years. What Auckland does not have are functioning networks of alternatives to getting around without always using the private car. Furthermore even though we have a gently increasing population traffic demand is not growing much in general and has either stabilised or fallen on some routes, even key routes such as the harbour bridge.
Especially when it is also clear that when we invest in the alternatives such as the Northern Busway and Britomart Train Station, these investments directly relieve pressure on the existing road resource; both making driving choice more attractive and providing the alternative AND saving us all huge capital cost. Not to mention saving the destruction of swaths of the city we wish to improve. Investing in complimentary networks is an investment in efficiency. Sweat those assets.
Invest in the missing modes next, we have already built the roads first, then lets see where the demand is and what sort of city we want.
Phil you are simply conflating the idea of a need for some roads, which is true, with the idea of a need for new roads, which is not.
As of course we already have a hell of a lot more than some roads.
Phil to answer your question yes there are road projects I personally agree with and there are PT projects I don’t agree with.
Roads
– By and large I agree with Waterview as it does complete the motorway network
– I do agree with the idea behind the East-West link, I think it’s important to improve the connections for freight in particular. I disagree with the solution of a massive motorway.
– I also agree that something needs to be done about the road north of Puhoi but again disagree with the solution.
– I agree with some parts of the governments motorway announcements a few months ago but again not the full blown solutions being talked about.
By now you may notice a bit of a theme, yes improvements can be made but the current proposals are way over the top.
– I also think there should be a greater focus on connecting neighbourhoods. There are probably heaps of places – especially in suburbs built over the last 50 years – where a small local bridge or the busting out of a Cul De Sac could greatly add to the road network. For example a connection between La Trobe St and Hope Farm Ave can help take a lot of pressure of Pakuranga Rd and be useful for all modes http://goo.gl/maps/za8Hv
As for PT projects. My main issues primarily relate to timing e.g. I don’t know if we will need a rail connection from the Airport to Manukau any time soon, in comparison to the proposed connection from Onehunga which I think should be built sooner.
As Patrick says, all of this isn’t saying we don’t want roads. They are incredibly useful and there are some good projects out there but by comparison we have invested little in other modes and so the focus should be on getting that sorted. Interestingly in a report I obtained from the MoT about arterials they said that there weren’t really any major things that could be done to the arterial roads in Auckland but that the focus on them should be on PT and for freight. Most people seem to agree that we should be using our existing transport resources more efficiently which I agree with. The current problem we have is that the solutions being proposed don’t do that, they take an approach of just building more roads rather than getting better use out of what we already have.
Phil, I share your passion for cars, they are a brilliant invention and I use mine most days. In New Zealand they of course open up our beautiful back country to a range of camping holidays, and yes a 4WD is the perfect beast to embark on such expiditions.
There are however certain situations where cars are incredibly inefficient. Peak hour commuting in our major cities is one of those situations. In a world that is short of money, it is a ridiculous expense to squander billions on new motorways to save a few minutes for peak hour commuters when there are better solutions. I am aware that commercial trucking is also used as a justification to spend billions on roading. My response is – how urgently do those goods need to be delivered? The freight market is incredibly price sensitive and subsidising truckie’s use of roading capacity at peak time just sends all the wrong pricing signals. The roading capacity for freight is there even on our busiest roads, just not at 5pm.
And I get really annoyed when I see totally different costing systems used by the government to assess the feasibility of roads compared to other modes, one suspects at the behest of the government’s supporters. There are a range of names for this – crony-capitalism is one, unethical or just plane unfair are other simpler words.
If earthquake risk is a major reason for not going ahead, then perhaps they should be moving the Wellington port, since fault lines run right beside it. Could they move the port to Porirua Harbour or somewhere along the coast. Perhaps move the capital to Palmerston North too!
I’d have to say that the recent Seddon earthquakes are likely to have put the knife into the Clifford Bay question. There’s not much to Seddon, and even less left of it now, but it seems to be a fault that trips quite often. Of the so-called damage in Wellington, the most obvious was the collapse of the edge of the Centreport reclamation – remember how they lost a container or two into the water? That’s basically because the rocks holding up the edge of the reclaimed land basically got shaken around, and subsided further down into the sea floor.
If Clifford Bay relies on a breakwater being constructed that is 1.6 km long, and that is built on top of one of our more active faults in the country, then someone has probably crunched some numbers that says this is a really dumb site to build a ferry terminal on. Yes, the site in Wellington is also a dumb site, but that decision was made a long time ago. In hindsight, I’m sure they would not do that there.
And to Peter F – Porirua is a harbour in name only. Very shallow, and silting up, with a nasty reef across the front. You could no more sail a ferry in there than you could park one in your garage. Wellington harbor is just fine!