The NSW Rail Access Undertaking

The NSW Rail Access Undertaking provides for third party access to certain parts of the NSW rail network owned by the Transport Asset Holding Entity (TAHE) (formerly Rail Corp) and the Australian Rail Track Corporation (ARTC).

The undertaking requires rail owners to:

  • charge no more than the full economic costs of providing access
  • charge at least the direct costs caused by trains using the rail line

The rail owners and the access seekers negotiate on prices and other conditions in accordance with the Undertaking.  We keep a register of who has entered into these agreements.

If the parties cannot agree on access, then either party can initiate arbitration. IPART may be the arbitrator or we can appoint a third party to undertake arbitration.

We are currently reviewing the NSW Rail access undertaking. Our final report to the Minister for Customer Service is due by August 2022

Rate of return and remaining mine life reviews

The undertaking requires rail access owners to charge no more than the full economic costs providing access. As required by the undertaking, IPART determines certain inputs to how the full economic costs are calculated. These are the:

  • rate of return
  • the remaining mine life.

We determine these inputs every 5 years. We last reviewed the rate of return and remaining mine life in 2019. These decisions apply until 30 June 2024.

Compliance with the NSW Rail Access Undertaking

TAHE and ARTC are required to submit information to IPART each year to demonstrate they have complied with the Undertaking.

IPART’s compliance guidelines provide information about this process. The requirements are different for the Hunter Valley Coal Network (HVCN) and non-Hunter Valley sectors.

Hunter Valley

TAHE’s Hunter Valley Coal Network between Newstan Junction and Woodville Junction is the only part of the Hunter Valley Coal Network that is currently subject to the NSW Rail Access Undertaking.

Each year we assess whether the revenue that TAHE has received has not exceeded the economic costs of providing the service.

Non-Hunter Valley

The parts of the non-Hunter Valley rail networks subject to the undertaking operated by ARTC and TAHE are shown below:

ARTC

TAHE

Turrawan to Boggobilla

Metropolitan Rail Network (MRN)

Goobang Junction to Merrygoen

Country Rail Network (CRN)

Merrygoen to The Gap

Northern Sydney Rail Corridor (NSRC)

Sydney Metropolitan Freight Network

 

For the Non-Hunter Valley Coal Network, we have 2 approaches for assessing compliance with the undertaking. We have set a threshold for access revenue at 80% of the full economic cost of providing access to decide between our approaches.

  1. If access revenue is substantially below the 80% threshold, we assess the price-related requirements in detail once every 5 years. Each year the rail owner provides a statement to IPART confirming that:
  • access revenue is less than 80% of the full economic cost of providing access
  • there has been no significant changes to revenue or costs, so that access revenues remain below the 80% threshold.
  1. If access revenue is approaching the 80% threshold, we require supporting cost and revenue information to be provided every year.