Comparison LCC cuts track maintenance costs: it is possible to examine different track maintenance strategies in terms of their cost-efficiency by applying a tool known as comparison life-cycle costs

International Railway Journal, Sept, 2005 by Berhard Lichtberger

DIFFERENT maintenance strategies are best assessed in relation to their effect on track geometry durability, the longevity of track materials, the frequency and type of maintenance operations, and in accordance with findings resulting from research. The comparison LCC process is then performed on this basis.

The method has proven to be successful with Austrian Federal Railways (0BB) where LCC investigations were carried out for different track maintenance strategies and then put into practice. Successes concerned the application of the Dynamic Track Stabiliser to extend maintenance cycles; the application of GPS technology for track surveying; and the use of formation rehabilitation machines to improve the subsoil or preventive rail grinding immediately after tamping.

The average overall annual costs for track handling between 30,000 and 50,000 gross tonnes/day/direction is about 35,000 [euro]/km. Optimising track laying and track maintenance is therefore a significant challenge. The aim of developing strategies and evaluation models is the optimisation of the time-related quality curve of the permanent way, and not the short-term technical-economic optimisation of the correction of a given track condition.

Labour costs are a major factor in track maintenance, and productivity represents the greatest cost lever. The potential to reduce costs lies not only in improved track access but also in better utilisation. Using comparison LCC to determine costs, differential calculations between various maintenance strategies or methods are performed on the basis of LCC. The method produces no absolute figures of the overall life-cycle costs, but it does produce useful statements about which strategg is the most cost-efficient for the life cycle of the track system.

The major sectors of life-cycle costs to be calculated are:

* track renewal (investment or re-investment)

* maintenance, including materials and machine transport

* additional operational costs caused by individual maintenance operations, and

* additional operational costs due to inadequate quality of the permanent way (long-term speed restrictions).

The amount and date of payment of these costs must be known to ascertain the required payment flow. The work cycles of the individual maintenance and renewal methods are important data. It begins with the initial investment, followed by the operational costs and market income arising from the investment.

The net present value method discounts all payments back to the start of the project and then adds up the discounted values. The total can be considered to be the dynamically determined profit. If net present values are applied over the chosen rates of interest, the result is the net present value function. A positive net present value represents a total saving over the period examined.

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The zero crossing point of the net present value function is the rate of interest at which the project yields interest for the capital invested. This is called the internal rate of return (IRR). The higher the IRR, the higher the economic efficiency will be. This method allows the economic efficiency of a project to he described by only one figure.

Composition of the annual costs is shown in Figure 1. The depreciation of the fixed assets is marked in red, the operational hindrance costs in blue, and the actual maintenance costs in green. The depreciation costs dominate. The fundamental strategic approach must therefore be an extension of the service life of the track and its components. Maintenance strategies that cause any decrease in the service life of track components are not economical.

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The calculations show that even slight extensions of service life bring noticeable potential savings. On heavily-trafficked lines, operational hindrance costs amount to more than 30% of the total costs, higher even than the maintenance costs. They are therefore relevant for decision making.

Track Stabilisation

Dynamic track stabilisation results in longer intervals between maintenance. Track maintenance reduces the track's resistance to lateral displacement. When a dynamic track stabiliser is not used, this is restored by the effect of passing trains but, in the meantime, demands a speed restriction for a certain length of time. This is linked to operational hindrance costs. On the other hand, the random forces of passing trains lead to track geometry deterioration.

A dynamic track stabiliser restores the resistance to lateral replacement and allows the track to be reopened at full line speed, thus dispensing with operational hindrance costs. The stabilisation process anticipates the settlement of the 100,000 tonnes of traffic in a controlled manner. The constant horizontal vibration of the dynamic track stabiliser makes the track settle evenly, and the gain in track geometry quality extends maintenance cycles of tamping machines by up to 30%. This strategy has proved to be highly cost-effective with very high internal rates of return and annual profits.