{"id":455333,"date":"2026-06-16T19:31:35","date_gmt":"2026-06-16T09:31:35","guid":{"rendered":"https:\/\/www.railfreight.com\/?p=71777"},"modified":"2026-06-16T19:31:35","modified_gmt":"2026-06-16T09:31:35","slug":"financial-incentives-are-not-always-the-best-modal-shift-tool","status":"publish","type":"post","link":"https:\/\/www.vibewire.com.au\/?p=455333","title":{"rendered":"\u2018Financial incentives are not always the best modal shift tool\u2019"},"content":{"rendered":"

European countries are still working hard on (and remain far removed from) their modal shift goals. Common wisdom says this requires investments and funding to make rail freight more competitive compared to the road. Financial incentives, however, are not always the best way forward, an investigation commissioned by the Dutch infrastructure ministry finds.<\/strong>
\n<\/span>The research examined ways to move more freight onto the Dutch Betuwe Line. This freight-dedicated railway connects the Rotterdam port to the European hinterland via Germany and is the busiest freight railway in the Netherlands.<\/p>\n

If the Netherlands wants to stimulate the modal shift and put more freight on the Betuwe Line, financial incentives are not necessarily the way forward, according to the investigation.<\/p>\n

Consultancy Rebel spoke to rail operators Rail Force One, Rail Cargo Group and DB Cargo, as well as rolling stock lessor NEXRAIL. The market parties indicated that they always seek to minimise operational costs and are hoping for lower track access charges. The Netherlands could, for instance, implement various types of financial instruments to shift freight to the Betuwe Line, such as bonuses for using the route or offering a concession to operate a non-commercially viable service on the route.<\/p>\n

Reliability over money<\/h2>\n

However, other considerations take precedence over financial considerations: operational robustness is key, such as reliability and interoperability. The rail operators and rail freight association RailGood believe financial measures to be limited in their effectiveness. This has several underlying reasons, which could also be applicable to other important railways across Europe.<\/p>\n

For one, the Betuwe Line is already the main and most efficient artery for many freight flows originating from Rotterdam \u201cunder \u2018normal\u2019 circumstances\u201d. Additional financial measures are not likely to make a difference. Moreover, operators say that they only have limited influence over external operational factors, such as border crossings, infrastructure availability and the quality of extended freight paths (Germany).<\/p>\n

\"Image:
DB Cargo on the German extended railway of the Betuwe Line. Image: \u00a9 Deutsche Bahn<\/figcaption><\/figure>\n

That limits the flexibility in freight path choices. Disruptions, maintenance outages, train length limitations and security and energy system differences also reduce the available route options for particular freight flows.<\/p>\n

Dutch rail operators consequently believe that structural improvements in interoperability, infrastructure capacity, reliability and border handling procedures are a better modal shift tool than financial incentives.<\/p>\n

\u201cA financial incentive can only be successful for operators when the Betuwe Line really is a robust and feasible alternative\u201d, the research concludes. If (infra)structural limitations remain, financial instruments will only serve as compensation for the negative effects, rather than a tool for behavioral change.<\/p>\n

In conclusion…<\/h2>\n

In short, the infrastructure needs to be in place to facilitate larger freight flows via rail. Only then can financial incentives for businesses help to get the modal shift going. The key remaining challenge for the Netherlands is that the number one bottleneck for the Betuwe Line is located in Germany. This has a lot to do with the \u201cThird Track<\/a>\u201d project, which will only be finalised in 2036 or even later.<\/p>\n

What the Netherlands itself can do: to look into the pros and cons of harmonising the 1500V\/ATB \u201cisland\u201d at rail yard Kijfhoek to ERTMS and 25kV, the research says. This would align it with the port railway and Betuwe Line and would make cheaper single-system locomotives and a larger locomotive fleet possible.<\/p>\n