Arafer publishes Frontier reports on marginal cost of rail infrastructure

The French rail and road regulator Arafer has published two Frontier reports on the marginal cost of maintenance and renewal of rail infrastructure in France today. The reports provide an expert review of the approach to estimating marginal maintenance and renewal costs, which form part of the basis for minimum access package charges.

French rail infrastructure manager SNCF Réseau sets minimum access package charges every year, which have to be agreed to by Arafer. Since 2015, Arafer has requested a significant update and refinement of SNCF Réseau’s analysis allowing for charges to be set in keeping with direct cost principles. Frontier’s reports review SNCF Réseau’s econometric analysis of marginal maintenance and renewal costs and recommends adjustments to the approach. As part of its negative binding opinion on SNCF Réseau’s proposed charges for 2018, Arafer demands that minimum access charges be amended to reflect the impact of Frontier’s recommendation on direct cost estimates.

Frontier Economics regularly advises on cost modelling and access charging across regulated infrastructure sectors.

For more information, please contact Saskia Nett on s.nett@frontier-economics.com, or call +44 (0)20 7031 7000.

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