On Tuesday, 17 January, the Cabinet of Ministers supported Transport Ministry’s and LDz’s proposed project for electrification of the country’s railway network and its further development. The plan provides for the electrification of the railway network from Daugavpils and Rezekne to Riga through Krustpils, as BNN was informed by Transport Ministry.
«The massive electrification project will make Latvia’s transport corridor more competitive and ensure new business development perspectives for transporters. With that, they will be able to secure faster cargo transportation services and save money, which will have a positive effect on the industry in a long-term perspective,» – says Transport Minister Uldis Augulis.
Augulis explains that, considering current railway cargo transportation trends, electrification of railway lines will be commenced in Riga’s general direction first. This will help achieve the project’s goals, which are economically justified. At the same time, the project’s realization will important for the growth of the industry and state economy, as well as economic growth of Latgale.
The analysis performed by Ernst&Young Baltic last year regarding the two alternatives for the first stage of the electrification project concluded that electrification of the railway line in Riga’s direction would be the most economically sound, Transport Ministry says.
«It is good that the government has made this decision. This project will help create additional revenue for the state budget in a long-term perspective and help with the industry’s development, as well as raise our competitiveness in comparison with other transit corridors,» – says LDz president Edvins Berzins.
LDz will soon prepare a detailed business plan for the project, as well as assess solutions for the participation of the state in the project to ensure its realization does not impact the state budget.
The first stage of the project will be realized as part of a specific support goal ‘Securing competitive and environment-friendly TEN-T railway line to ensure security, quality and capacity’. The amount of funding available from the EU Cohesion Fund is EUR 347 million. The total cost of the electrification in Riga’s direction is EUR 519 million, the ministry reports.
Officials explain that technical risks and the possibility of realizing Rail Baltica project together with the electrification were considered during the project’s development. Simultaneous realization of both projects would create additional challenges for the organization process. The ministry does promise to find optimal solutions.
Electrification of Latvia’s railway network is included in the National Development plan for 2014-2020 as an important transport industry development project.