Will $4 billion be allocated in the federal budget for upgrading the Northern Sydney Freight Corridor to carry more freight by rail?
The New South Wales government has nominated no other source of funds for this upgrade, which must be finished before 2028 to meet forecast demand.
While the NSW government expects to raise $2 billion by selling a 99-year lease to Port Botany Container Terminal, none of this will be spent on the Northern Sydney Freight Corridor. And yet the sale commits the NSW government to the $4 billion upgrade to maintain rail access to Port Botany Container Terminal and the intermodal terminals planned for Moorebank and Eastern Creek, in outer western Sydney.
The NSW government will not permit a container terminal at Newcastle and considers that northern NSW is adequately served by the container terminal at Port Botany. More likely, a container terminal at Newcastle would attract business away from Port? Botany terminal by providing a better service to northern NSW. This would reduce the sale value of the Port Botany lease. Additionally, a container terminal at Newcastle would justify a freight rail by-pass of Sydney, with containers as the base commodity. They would arrive in Eastern Creek or Badgery's Creek faster and at similar cost compared with Port Botany.
An outer western Sydney freight rail by-pass would make the two intermodal terminals proposed at Moorebank redundant. The Southern Sydney Freight Line would enable containers to be railed between Port Botany and a single intermodal terminal at either Badgery's Creek or Eastern Creek, until the freight by-pass to Newcastle was built. The current customers of Port Botany container terminal that receive 1.7 million TEU a year by truck could continue to do so until they were encouraged to relocate to outer western Sydney, in 10 years' time. Removing freight from the Sydney rail network would enable 100% of capacity to be used for passenger trains. As pointed out by Deloitte Access Economics, if rail absorbed 30% of the forecast increase in Sydney urban travel then congestion, safety and carbon emission costs could be reduced by around $1 billion a year by 2025.
When removing freight from the Sydney rail network is worth $1 billion or more a year, is it sensible to sell a 99-year lease to Port Botany Container Terminal, especially if the $4 billion funding required to upgrade the freight rail capacity is not provided by the Australian government?