On 1 October, a German court ruling paved the way for a DB InfraGO upper cost limit of €8.2 billion in 2027. This meant that track access charges (TAC) paid by rail operators could be higher than previously determined. Now, the German rail infrastructure manager says that it will not fully utilise the raised limit.
The upper cost limit for DB InfraGO determines the maximum track access charge level that the infrastructure manager can demand. A higher limit means (potentially) higher costs for rail operators. Naturally, the rail industry was not happy with the court’s aforementioned decision.
DB InfraGO now says that it will not fully utilise the newly set upper cost limit. Rather, it has requested “a significantly lower target revenue of €7.5 billion, which corresponds to a total price increase of 7.9%”, the infrastructure manager writes.
The price increase amounts to 12.9% for rail freight, 7.7% for regional rail passenger transport, and 5% percent for long-distance rail passenger transport. This could still be reduced, depending on federal maintenance funding.
Relief for rail?
DB InfraGO’s restraint does not seem to have helped the prospects for rail freight much. On 1 October, the German private rail freight association Die Güterbahnen said that it would lead to a minimum price increase of 12.6% for the industry. Based on the latest figures, TACs will grow by 12.9%. When factoring in a decline in subsidies, rail freight will still pay 75% more in 2027 compared to 2026: from around €1.82 to €3.17 per kilometre.
The prospect for 2028 looks even more bleak. “At the end of the week, we will also submit the track access charge application for 2028 with a preliminary target revenue of €8.588 billion”, DB InfraGO says. This figure is seen as a precautionary measure, because the scope of maintenance funding and the total cost upper limit for 2028 are not yet clear. In theory, this would lead to a further price increase for rail freight of 14.3%.
“With each further price increase, the spiral of rising costs, declining traffic volumes, and poorer infrastructure utilization intensifies”, commented Oliver Smock, Senior Consultant at Die Güterbahnen.
“Until a fundamental reform is implemented, a significant increase in track access charge subsidies is needed in the short term to limit the further decline of rail freight. However, such subsidies can only be a temporary solution until Germany follows the example of most European countries and ensures genuine stability and competitive track access charges with a reformed system. Even the Ministry of Transport cannot simply wait this situation out indefinitely.”